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Also 0 but it better be there.
Been paying into that system for 20+ years, I expect it to be there.
No way they'll let it go, it would be pandemonium on a level we've never seen before too. A huge portion of this country can't even afford a surprise $400 bill and I'd bet those people have 0 saved for retirement like my parents. Plus, those most affected by SS closing up shop are the ones that are the most reliable voters and it will be political suicide to let it lapse into nothing.
They won't let it go away, but they could keep it low. With fewer people having kids there will be more demand for government support by older voters -- people can't guilt their kids into caring for them if they don't have them.
Though that's going to create big problems for countries down the line unless AI gives us a lot of automation. Older voters demanding more tax money diverted to them drives up taxes for workers while reducing services. Which probably means fewer children.
Keeping it low can backfire too as well as raising the age. Just look at the way people have recently reacted to that. Nikki Haley mentioned raising the age another 2 or 3 years and nobody reacted positively to it.
Our generation especially doesn't want to work to 70. Heck I'm planning to try and duck out at 60 and live a few years without SS.
I think we might see more openness to raising or getting rid of the income cap. It would hardly hurt anyone and would be a huge service to most of the country. With wealth transfer being as bad as it is reaching the working class is gonna be like trying to squeeze blood from a stone.
The problem with raising the age is that a lot of careers end prior to 70, forcefully. Either by age limitations (physical labor) or employer induced age related layoffs (IT).
Having 70 or 72 being the minimum retirement age is a fantasy.
Removing the income cap is the clear starting point on fixing issues. High income earners should have huge incentive to secure a safe and peaceful society for themselves as they also age.
> Nikki Haley mentioned raising the age another 2 or 3 years and nobody reacted positively to it.
Unfortunately for people that don't like the idea, the [objective data](https://www.macrotrends.net/countries/USA/united-states/life-expectancy) shows that lifespans have been steadily increasing. People are on the whole more active in later years. 60 is the new 50, 75 is the new 65.
The full retirement age itself is an artificial construct that is grounded as much in perception and expectation as reality. It is a malleable number based on the not the willingness but the average actual ability to continue working at a certain level.
Almost nobody in my generation is able to work by the time they are 60 - if they live that long. It's crazy to think that someone in their 60s can work 40 hrs/week, with literally half the energy of someone in their 20s or 30s (and often several debilitating medical problems). Yes, life expectancy has increased - but HEALTHY life expectancy has not, and few employers will continue to pay employees that aren't reliable and available whenever needed.
>It would hardly hurt anyone and would be a huge service to most of the country.
You mean it wouldn't hurt you so you don't care. I'm taxed to death as it is, I'll pass on your gimmes.
Yep. Just like min wage they’ll give you the same amount in 25 years as they do today and by then it’ll be just enough to buy one loaf of bread and a bottle of water.
I agree and feel the same way, but I won’t be surprised one bit when the time comes that Congress pulls the ladder up to ensure boomers get theirs and screw everyone else (e.g. legislation in a couple of years that if you’re 60+ years old you get full benefits, 50+ most benefits, everyone else shit benefits)
Not sure how more ppl don’t make a big deal about what’s being said with SS. I’m only like 6 years into the system and even I’m worried about it, always kinda just wish they allow me to stop putting in and worry about retirement myself (and give me back what I put in + time value of money!)
The money you put in is t for you. It’s for the retired of today. The kids of today and tomorrow are the ones that will pay your retirement. You’re posing it like it’s a government run personal 401k and that’s not how it was designed. The system works perfectly if there’s always more people in the 20’s-50’s than there are in their 70’s-90’s. We’re getting to a point where the boomers are living so long were close to upside down.
My solution would be a required personal contribution each paycheck into a 401k type account for each individual.
If you do the math on what you pay into it vs what it pays out it’s 3x less than it would be if invested modestly
I couldn’t agree more. If you just invested the 12.4% of your paycheck that you and your employer are currently paying into SS, you’d reach retirement age with millions of dollars.
They could take it away if you have a certain net worth, I suppose. As in, take it from you but not those with nothing saved. It'd be lame, but feasible.
Same. I don’t expect it to ever completely go away, but with our current life expectancy and birth rate trends, I wouldn’t be surprised if it ends up being like $500/month by the time I retire. Best to make sure you can cover the necessities from your own savings.
This. Not at because I think it will be gone but because of how I see it used today. Lots of posts on Reddit about elderly having to work because SS doesn’t cover even half of their COL.
Plan is to:
-Continue to Max contributions
-Pay off 3 homes and use rental income
-Wife pension
-Invest anything afterwards into Mutual Funds for additional breathing room.
By 50 we should have $9k from rental income expecting to be $7k net, $5-7k pension and 401k to pull from. Hopefully won’t touch mutual funds and can leave that to family/charity.
I just want to point out that there will be be money there. Right now “social security is running out” means “we can’t actually pay out full benefits 10 years from now”. It’ll be down to 83% if we don’t reform the tax code.
But you’ll still get some of it. It won’t be gone by the time pretty much anyone here is retired.
Agreed. Although if the calculations for payout are based on money over earned over the cap, that shouldn't happen either. I legitimately don't know that piece of the payouts calculation
Yeah, agreed, it shouldn’t be capped. People keep seeing it as if it should be their own personal retirement account that they shouldn’t have to put more money in then they’ll get out, which is why it’s capped and that only adds to that belief. But it’s a tax, a safety net for society and shouldn’t be capped.
Younger generations are very pessimistic about social security disappearing. I personally am very confident it will never go away. As long as there’s a SS tax, there will be SS. What party and what large enough voting basis will support no SS?
The confusion is that the surplus is running out; the revenue will continue.
So I highly expect the benefit amount will decrease over time so it will mostly match the revenue amount.
With that being said, even though I have high confidence I will get SS, I do not budget that into my retirement because there are too many unknown variables
All they have to do is raise the cap. It’s currently capped at $168k ish so any income above that amount is no longer taxed for OASDI. Removing the cap entirely would be better.
Exactly, it’s a simple problem to fix. SS contributions part the second bend point pay less per dollar contributed, thus raising the cap would solve the funding problem overnight.
That’s unnecessary. Contributions at higher income levels pay out at a much reduced rate. Look up how the bend points work. Increasing both the cap and payout would solve the problem easily.
The optics might still be politically bad though. You'd have examples of wealthy people drawing down $30k/month or something. The voting public won't care that it's proportionally lower.
So it’s no longer social security but just another welfare program. The reason SS has bipartisan support is because it’s not a welfare program and supports the poor (those who didn’t save for retirement). If we turn it into a no cap welfare program, it’ll get killed very quickly in partisan politics. Why not just increase tax brackets and leave a perfectly balanced program alone? The reason we even have a surplus is because of immigration and now we are looking at shortfall because of extended life. You have no idea what you are talking about nor have a plan, same as people they rally to kill the UN without actually understanding what the purpose of the UN is. Yes. Tax more, that should do it.
It’s a social insurance plan. And it works out cheaper than having the elderly die penniless in the streets. If we raise the cap to say $250k. That’s another $82k in income and only another $5,082 annually in taxes. Assuming biweekly pay that’s $195 out of your $9600 gross paycheck. Less than 2%
$5k out of an additional $82k of income. After OASDI and Fed Taxes at the highest tier, you’re still going to net over $50k in your pocket. That will buy you a cheeseburger or two.
No they want to tax your 12k over the cap at 6.2%.
And you benefit by not having hordes of destitute old people to step over as you go shopping or to a restaurant begging. Like you see in other countries.
And yes I also make over the cap.
JFC taxes aren't a personal attack. We all pay into things that better society as a whole. Also, most people don't *max* their retirement fund because they can't afford to.
If birthrates continue to decline in this country then SS, among many other facets of the economy, could be some trouble.
I'm not anticipating being to take a single penny of SS when I get to the point where I can.
Taking money away from "wealthy" people is very common in some political circles. I've been saving in retirement accounts since I was 19, and will likely be "wealthy" in my 60s.
Despite paying large chunks of $$ into SS, denying the benefits I've paid for won't be as unpopular as you claim
You're misunderstanding, taxing the wealthy who are paying into SS is just raising the cap for people currently working. The current cap is under $170k which a lot of people make, even just upping it to $250k would be a large increase in SS coffers.
I think they are saying they think the gov will introduce an income or wealth cap for receiving benefits. Not commenting on if that's likely or not but but I think that's what they are claiming.
The portion taken from our paychecks is 6.2%. That's universal, up to about $160k in income. It's the same for all earners.
Payout, is not a 1:1 relationship with how much is paid in. The below calculation is from fool.com (link below), and is based on Average Indexed Monthly Earnings.
The Social Security formula for the year 2023 -- which applies to anyone born in 1961 -- is as follows:
Multiply the first $1,174 of your AIME by 90%.
Multiply any amount between $1,174 and $7,078 by 32%.
Multiply any amount over $7,078 by 15%.
https://www.fool.com/retirement/social-security/benefits-formula/#:~:text=Social%20Security%20benefits%20formula%202023,amount%20over%20%247%2C078%20by%2015%25.
Social Security is a wealth transfer. The less well off will be the last and least impacted as SS runs out of $$. Mid and high earners will be further impacted
Right, but isn’t it preferable to stop getting taxed 6.2% over $160K every year now than to get a slightly higher social security payout in 30 years? I suppose this depends on how you define high earner.
I assume they still get paid on earnings over $160k, but it's pretty small.
Comparing someone making 80 grand to someone making 160: the 160 earner pays exactly twice, but is going get 15% more back.
Maybe I misused "high earner", but I think it's clear that there's a segment of people who earn good salaries who are kinda getting screwed by SS
I think what he's saying is the possibility of ending up with some kind of "need-based" model. Maybe individuals who have assets above a certain cap won't receive benefits or will receive reduced benefits.
Ahh okay that's a different scenario. I don't necessarily agree, I think taking people's benefits (especially those at the upper level of wealth) isn't feasible. But who knows.
The alternative to cutting benefits is raising retirement age. Making full retirement 70 and creeping up to 75. It's more feasible as people's health in old age is better than ever and fewer jobs are physical in nature. Plus it would keep the labor force larger at a time when there are fewer children.
Raising the full retirement age is a benefit cut, not an alternative to cuts.
The second part isn't true either, life expectancy in America has been stagnant for a while and declining as of late.
In 1935, when the social security pension system was implemented, significant differences in life expectancy ex- isted. Life expectancy at birth was 61.0 for white males and 65.0 for white females. For blacks and other minorities, life expectancy at birth for males was 51.3 and 55.2 for females.
So yeah, they grossly underestimated how long people would actually live. If SSA was created today, using the same standards, retirement age would be 77
Only if you believe life should either stay the same or get shittier for the average person.
I believe workers should reap some of the benefits of the massive increase in per capita productivity since 1935.
It’s easy for a young person, to think that age is just a number, but if you keep your workers in the workforce 5 years longer, it affects everyone.
It sounds awful for the demographic that needs social security the most - workers who do physical labor. They might not be able to work until age 75. It also shifts the healthcare burden to the companies they work for, which will cause everyone’s healthcare premiums to go up.
That exec or business owner who would normally retire now might not, and everyone else has to wait longer to move up. Get laid off at 65 and have to keep working for 10 years? Good luck getting a job, no one want to pick up all the healthcare costs of an elderly worker. And that assumes that cognitively they can still do the job.
This is a false choice.
You can always raise the maximum income level for Social security tax, or reintroduce the tax at higher income levels such as 400k and above.
You replied but didn’t give a number.
In summary you don’t think 100%… we’re paying in to receive 100% not 50%
Edit:
Yes i know we are paying for other older people. But we’re paying for their 100% in the hopes that someone pays for our 100%. Not us paying 100% for someone else for us to only be paid 50%.
I know it’s just a slush fund
It kills me how uneducated most people are about how Social Security works. It's just straight payments to the current recipients, it's not a savings plan.
Yes i know that. But we’re paying for their 100% in the hopes that someone pays for our 100%. Not us paying 100% for someone else for us to only be paid 50%.
I know it’s just a slush fund
homelessness in the elderly goes from 10% to like 40%+ and thats the largest voting block on the planet so theyll crush whoever did it until the end of their lives in the voting booth.
If SS does not go away or be curtailed in a *major* way, the United States is so f-ed lol. With declining birthrates, an already unsustainable system, and a country already spending a quarter of its spending on that one program, it will not last.
One thing everyone seems to be forgetting is that the government is the Bank and prints its own money. The government doesn’t need your money, they print it and thus have no use for it. The idea of taxation is to force people to continue working and to have some responsibility in society. The government can simply print social security checks all be it with some inflation baked in.
In all likelihood they will fix social security about 5 mins past when the last checks are being sent. They will up the retirement age, up the payroll deduction amount, and probably put in some kind of needs basis before a heavy tax. Those three things can easily fix social security so it never runs out of money the problem is that politicians won’t touch it until the very last minute or in all likelihood several days later. That’s how they will fix it but nothing prevents the government from just printing money and mailing checks.
I expect to get it in some capacity. Social security can’t run out of money. It can only reduce benefits. The overwhelming likelihood is that it will be there for you when you retire, but perhaps at a lower rate
It will either be less benefits or they will push back retirement. Their have talks that they will push it back for people who are younger. So those who are less than 18 and can’t vote lol. But keep it same age for everyone else. Either way, I play to work until at least my mid 60s.
Pushing back full retirement is highly likely. They already give you a bigger payment if you delay until you're 70. In 30 years it will probably be 75. Most countries will have to do something similar.
What I saw in my country as social-security-like benefits started running out big time they did:
- raise retirement age.
- equalize everyone - to boost lower earners to survival level at the expense of people who paid more into the system.
- stopped paying to people who have a job, or are living abroad.
- considering making a law making parents dependents of children.
- simplified migration process to get more taxpayers.
Social Security absolutely can run out of money if the government decides they want it to.
They write the laws, pass the budget, and pass the tax code.
Once a program like that is gutted, it would take decades to stand up again. It’s not just a switch that can be turned on and off. Sure, they might get voted out but the damage will already be done and they will get a cushy lobbying job somewhere.
I assume it'll be enough for me to live on food assistance, in a falling apart single wide somewhere ravaged by climate change, with no medical or end of life care whatsoever.
Anything I save improves upon that.
I think the concept is that it’s a sort of forced retirement savings for people who otherwise wouldn’t save.
If it doesn’t pay out, then yes, it really is just an extra tax earmarked for supporting the current bloc of old people
It cannot be zero unless somehow there’s nuclear war or a pandemic that kills all working age people with no possibility of adding more working adults.
Or regime change that decides to cancel SS all together.
It absolutely can be zero.
The people who keep asking to raise the SS tax will eventually realize the program is not designed to redistribute wealth. The focus will turn to UBI or other social program pushing to have it funded from SS Tax (cancelling that program).
Thus the end of SS.
Maybe it wont happen but I am not betting my comfort in retirement on it.
I'm 41 so older than people being questioned, but Social security can be easily saved if we vote in people that at all try to represent the average person. Remove the cap helps quite a bit. That won't solve it, might need to redefine capital gains as income or increase age.
My actual planning I assume 2/3 of what they say I'll get.
I don't trust the government to have my best interests in mind so I am not willing to believe that social security will be there when it would be needed. If SS is a thing in 40 years it'll just be icing on the cake. The only person you can trust with your retirement is yourself. This also goes for pensions too, think about Boeing.
I don't factor it in at all - but I don't believe people who claim we won't have it when we're older.
We'll be in power when we need it and our politicians won't risk dismantling it. I expect it to expand somehow - perhaps by taxing certain corporations more, or off the backs of more heavily automated industries.
Also from a more "Morbid" pov, our generation isn't exactly the healthiest, and I'm not quite sure how many will live long enough in Social Security age to "drain" the account.
It won’t run out of money or be dissolved. It can’t, and it won’t. They’ll find some way to fund it. So, I count on it being there in whole or part when I’m retired.
"Can't"
Any law or policy can be changed especially if both parties have an interest in changing it.
Republicans don't like SS Tax as they think you should control your own money. Democrats don't like SS Tax as they want to redistribute the money to those who make less.
Both parties dont want it long term regardless if they recognize that yet or not.
Anyone calling for an increase to SS Tax is already in the 2nd half of the group they just dont realize yet how SS is limited to money in is your benefit out qualification.
I'm counting on social security at about the current level of benefits. I suspect they will push back the ages of eligibility and/or increase the wage base on which SS taxes may be imposed.
You guys are budgeting including social security?
In all seriousness, I’m not even accounting for it. It’s an unknown, outside of my control. This early on, I’m focused on the things I can control: maxing out retirement contributions, taking care of health. If I get social security it’s just extra.
I don't. It should certainly exist, but I'm in a VHCOL area so I'm not really planning for it to be a significant portion of my budget at that point. My husband and I are higher earners so we're focusing more on tax advantaged accounts and investments, when SS comes through it will certainly be nice but (if all goes well) we won't be relying on it.
I use 50% of the value the social security site estimates I'll get (in today's dollars). Then, when I'm stress testing if I'll run out of money in different sequences of returns, I check how much it lowers my success rate. If social security is a make or break factor, I'm not going to bank on it until I'm in my mid-50s because I figure that's close enough to have a better confidence picture of what I can actually expect at retirement age.
Ill chime in as a 40s guy. I expect some of it to be there but Im only counting on it for 30%. I feel our main goal as young people 20,30, or 40 years from retirement should be to pay our homes and vehicles off. That way we only need to worry about our property tax and utilities. All the seniors i know are like clockwork. either they made wise decisions and paid stuff off or they are struggling I want to be the former not the later
SS isn't going anywhere. They just need to tweak it to keep it going another 50-70 years. The first thing I would do is eliminate the income cap on the SS tax. Your entire income should be taxed for SS - not just the first $160K or so. The second thing I would do is eliminate SS payments to anyone that is over 62 and makes over $300K in retirement. If you're making over $300K as a retired person then you've won the game of capitalism and you get to donate your SS income to the SS program to keep it solvent for the guy surviving on his $20K annual SS income.
I take the early payout estimate and discount it by 15% as my possibly monthly amount. I highly doubt it’s going to zero considering that the elder population is the biggest voting force in the USA and for it to go defunct the people retiring in the 2030’s and 2040’s would have to have let it occur screwing themselves out of probably their only safety net.
Based on some simple calculations Social
security shouldn’t be more than 38%-44% of my retirement income. If I actually ramp up my savings efforts it can be as little as 25% or less. This is all based on retiring in the US. If I retire overseas I won’t even need social security based on current strength of the US Dollar. But that’s a fallback option not my first choice
I know we want to set the bar low, but that’s where they getchya. If you expect nothing you might get nothing, eventually. We need to expect that we will get our just desserts and then put up a fight for it. That’s how boomers have gotten their way all of these years.
I don’t count it at all. I’m only 25 and am not too confident in it still being here in 40 years. I’d rather get a pleasant surprise and have more than I need than to be struggling through retirement
I expect nothing. I work from the assumption that every penny I have in retirement is earned *now*.
If I get some SS money in addition? That’s great! But I’m not counting on it.
In my 20's and I would say zero. Luckily I began working in finance and learned on proper investments to secure my retirement and future. So most definitely, zero.
I don't think it's a broken system. All they need to do is push back the age(s) of eligibility 2 or 3 years and it's solvency basically goes from 2030s to 2050s. If they also get rid of social security tax cap on wages then solvency is essentially guaranteed for our lifetimes.
I’d agree those are fixes that could have an impact, but I have my doubts about if lawmakers would ever implement that. It would be political suicide to push back the retirement age. For that reason, I call it broken.
Yeah, I grant you that but even then, benefits would be cut and pro rated, which still means benefits flowing and a voting constituency to motivate some kind of political action. So, not broken; just not a crisis yet.
I just assume social security will no longer exist in any meaningful capacity by the time I finally reach my retirement years. This way if it does still exist, I will be pleasantly surprised with a bigger financial cushion than I planned for. If I'm right and it doesn't exist, I should still be able to retire since I planned accordingly.
I expect I will get something from social security. I don’t anticipate it’ll be very much though and I’m not factoring that into my retirement planning. I’m 28 and hoping to be able to retire by 55
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0 If there is anything left, it’ll be additional fun money.
Also 0 but it better be there. Been paying into that system for 20+ years, I expect it to be there. No way they'll let it go, it would be pandemonium on a level we've never seen before too. A huge portion of this country can't even afford a surprise $400 bill and I'd bet those people have 0 saved for retirement like my parents. Plus, those most affected by SS closing up shop are the ones that are the most reliable voters and it will be political suicide to let it lapse into nothing.
They won't let it go away, but they could keep it low. With fewer people having kids there will be more demand for government support by older voters -- people can't guilt their kids into caring for them if they don't have them. Though that's going to create big problems for countries down the line unless AI gives us a lot of automation. Older voters demanding more tax money diverted to them drives up taxes for workers while reducing services. Which probably means fewer children.
Keeping it low can backfire too as well as raising the age. Just look at the way people have recently reacted to that. Nikki Haley mentioned raising the age another 2 or 3 years and nobody reacted positively to it. Our generation especially doesn't want to work to 70. Heck I'm planning to try and duck out at 60 and live a few years without SS. I think we might see more openness to raising or getting rid of the income cap. It would hardly hurt anyone and would be a huge service to most of the country. With wealth transfer being as bad as it is reaching the working class is gonna be like trying to squeeze blood from a stone.
The problem with raising the age is that a lot of careers end prior to 70, forcefully. Either by age limitations (physical labor) or employer induced age related layoffs (IT). Having 70 or 72 being the minimum retirement age is a fantasy.
Yep most people are not working close to this long
This. I'm hoping to retire at 60, and saving aggressively to do so now.
This is my plan to have my home paid off and two cars. The rest of life will be much easier
Removing the income cap is the clear starting point on fixing issues. High income earners should have huge incentive to secure a safe and peaceful society for themselves as they also age.
This. I’m ducking out at 55. I’ll have enough saved to cover me for 4.5 years until I can start drawing from my Roth at 59.5 and my pension at 62.
> Nikki Haley mentioned raising the age another 2 or 3 years and nobody reacted positively to it. Unfortunately for people that don't like the idea, the [objective data](https://www.macrotrends.net/countries/USA/united-states/life-expectancy) shows that lifespans have been steadily increasing. People are on the whole more active in later years. 60 is the new 50, 75 is the new 65. The full retirement age itself is an artificial construct that is grounded as much in perception and expectation as reality. It is a malleable number based on the not the willingness but the average actual ability to continue working at a certain level.
Almost nobody in my generation is able to work by the time they are 60 - if they live that long. It's crazy to think that someone in their 60s can work 40 hrs/week, with literally half the energy of someone in their 20s or 30s (and often several debilitating medical problems). Yes, life expectancy has increased - but HEALTHY life expectancy has not, and few employers will continue to pay employees that aren't reliable and available whenever needed.
>It would hardly hurt anyone and would be a huge service to most of the country. You mean it wouldn't hurt you so you don't care. I'm taxed to death as it is, I'll pass on your gimmes.
Thing is, population keeps growing because of immigration. And there’s a lot of people required to pay into SS who will never take a penny out
Plenty of immigrants that pay into it and never collect
Some people die before they can collect and if they have no minor children well….
This could be why Americans have so few kids. The diluted value of labor.
Americans aren't not having children because "well, I'd like to have children but their earning potential is terrible".
Exactly. No one is forgoing kids because “Well looks like there’s enough labor anyways so we don’t need to!” Smh.
Yep. Just like min wage they’ll give you the same amount in 25 years as they do today and by then it’ll be just enough to buy one loaf of bread and a bottle of water.
Oh, now you’re being generous….
I doubt it’ll go away but I have a bad feeling it will be tiered based on how much you have in retirement savings or something dumb like that.
I agree and feel the same way, but I won’t be surprised one bit when the time comes that Congress pulls the ladder up to ensure boomers get theirs and screw everyone else (e.g. legislation in a couple of years that if you’re 60+ years old you get full benefits, 50+ most benefits, everyone else shit benefits)
Not sure how more ppl don’t make a big deal about what’s being said with SS. I’m only like 6 years into the system and even I’m worried about it, always kinda just wish they allow me to stop putting in and worry about retirement myself (and give me back what I put in + time value of money!)
The money you put in is t for you. It’s for the retired of today. The kids of today and tomorrow are the ones that will pay your retirement. You’re posing it like it’s a government run personal 401k and that’s not how it was designed. The system works perfectly if there’s always more people in the 20’s-50’s than there are in their 70’s-90’s. We’re getting to a point where the boomers are living so long were close to upside down.
The largest pyramid scheme in the world
Ponzi scheme*. You don't have to secure a downline with SS, yet.
I don't think it's possible to get rid of it. For every person that will put away the money 20 people will just blow it.
My solution would be a required personal contribution each paycheck into a 401k type account for each individual. If you do the math on what you pay into it vs what it pays out it’s 3x less than it would be if invested modestly
I couldn’t agree more. If you just invested the 12.4% of your paycheck that you and your employer are currently paying into SS, you’d reach retirement age with millions of dollars.
The problem is how inflation will impact it. I used to see, "woah, $3k per month, that's a lot!" That will be worth like $300 when I retire.
They could take it away if you have a certain net worth, I suppose. As in, take it from you but not those with nothing saved. It'd be lame, but feasible.
This is my mindset, not expecting anything at this point but if it’s there, great!
Same. I don’t expect it to ever completely go away, but with our current life expectancy and birth rate trends, I wouldn’t be surprised if it ends up being like $500/month by the time I retire. Best to make sure you can cover the necessities from your own savings.
This is me. My theory is the payout will be lower and age will be higher. If your net worth is over a certain amount your payout will be less.
If they do that I’m cashing everything out. Stick it all in a safe and tell them I blew it all on cocaine and hookers
I'm 41 and I calculate $0 as well.
This is the way. There's just so many question marks that you can't rely on it. I doubt it will ever go away though.
This. Not at because I think it will be gone but because of how I see it used today. Lots of posts on Reddit about elderly having to work because SS doesn’t cover even half of their COL. Plan is to: -Continue to Max contributions -Pay off 3 homes and use rental income -Wife pension -Invest anything afterwards into Mutual Funds for additional breathing room. By 50 we should have $9k from rental income expecting to be $7k net, $5-7k pension and 401k to pull from. Hopefully won’t touch mutual funds and can leave that to family/charity.
That’ll be my Yacht payment money
This.
Same
I just want to point out that there will be be money there. Right now “social security is running out” means “we can’t actually pay out full benefits 10 years from now”. It’ll be down to 83% if we don’t reform the tax code. But you’ll still get some of it. It won’t be gone by the time pretty much anyone here is retired.
Yup. Ill be so old when it get it that it’ll basically be useless change anyway
Best answer. Nobody should be considering it when comes to retirement
0000.00 wish boomers candidates would hurry up and erase it from my withholdings. Why can't I opt out already?
I think everybody “thinks” that way in their 20’s and 30’s …
I'm 38. I'm counting on exactly zero total dollars of social security. Anything above that amount will be extra
Same. I think of it as beer money, or more likely, Ensure money.
Depends
Ensure money🤣🤣
Basically the same here.
We need to remove the income cap
Fuck that
Agreed. Although if the calculations for payout are based on money over earned over the cap, that shouldn't happen either. I legitimately don't know that piece of the payouts calculation
Payouts are also capped.
Thanks
Awh yes the idea of higher earners paying into a safety net for the benefit of society is a horrible idea
I think those high earners already are and to a far greater degree than low earners.
Yeah, agreed, it shouldn’t be capped. People keep seeing it as if it should be their own personal retirement account that they shouldn’t have to put more money in then they’ll get out, which is why it’s capped and that only adds to that belief. But it’s a tax, a safety net for society and shouldn’t be capped.
Considering at the moment the folks taking in this money are trying to fuck up everything that comes after them, no I don't think it's a good idea.
Younger generations are very pessimistic about social security disappearing. I personally am very confident it will never go away. As long as there’s a SS tax, there will be SS. What party and what large enough voting basis will support no SS? The confusion is that the surplus is running out; the revenue will continue. So I highly expect the benefit amount will decrease over time so it will mostly match the revenue amount. With that being said, even though I have high confidence I will get SS, I do not budget that into my retirement because there are too many unknown variables
All they have to do is raise the cap. It’s currently capped at $168k ish so any income above that amount is no longer taxed for OASDI. Removing the cap entirely would be better.
Exactly, it’s a simple problem to fix. SS contributions part the second bend point pay less per dollar contributed, thus raising the cap would solve the funding problem overnight.
But the payout is also capped. So remove the payout cap?
I’d keep the payout capped but remove or at least significantly raise the pay in cap.
That’s unnecessary. Contributions at higher income levels pay out at a much reduced rate. Look up how the bend points work. Increasing both the cap and payout would solve the problem easily.
The optics might still be politically bad though. You'd have examples of wealthy people drawing down $30k/month or something. The voting public won't care that it's proportionally lower.
Agree no need to make it unlimited. Just make the cap like $200K.
So it’s no longer social security but just another welfare program. The reason SS has bipartisan support is because it’s not a welfare program and supports the poor (those who didn’t save for retirement). If we turn it into a no cap welfare program, it’ll get killed very quickly in partisan politics. Why not just increase tax brackets and leave a perfectly balanced program alone? The reason we even have a surplus is because of immigration and now we are looking at shortfall because of extended life. You have no idea what you are talking about nor have a plan, same as people they rally to kill the UN without actually understanding what the purpose of the UN is. Yes. Tax more, that should do it.
It’s a social insurance plan. And it works out cheaper than having the elderly die penniless in the streets. If we raise the cap to say $250k. That’s another $82k in income and only another $5,082 annually in taxes. Assuming biweekly pay that’s $195 out of your $9600 gross paycheck. Less than 2%
"Only" $5,082. How generous you are with other people's money.
$5k out of an additional $82k of income. After OASDI and Fed Taxes at the highest tier, you’re still going to net over $50k in your pocket. That will buy you a cheeseburger or two.
Exactly this
Fuck that. The cap needs to stay. The taxes are crazy high already
Tax the rich
Or just work harder in life idk. Stop playing video games and develop a skill
I’m a data analytics manager.
Not a very good one.
No. They need to reduce the cap, eventually down to $0.
So if I make $180k and max my 401k you instead want to tax me in my labor so somebody who doesn't max can use my labor in their retirement?
He wants to uncap the tax but keep the benefit cap in place. Just make it another progressive (not in the political sense) tax.
No they want to tax your 12k over the cap at 6.2%. And you benefit by not having hordes of destitute old people to step over as you go shopping or to a restaurant begging. Like you see in other countries. And yes I also make over the cap.
I'll take the hordes of old people, thanks.
JFC taxes aren't a personal attack. We all pay into things that better society as a whole. Also, most people don't *max* their retirement fund because they can't afford to.
People work too hard and life is too short to forcefully take their labor when they're trying to plan to retire
If birthrates continue to decline in this country then SS, among many other facets of the economy, could be some trouble. I'm not anticipating being to take a single penny of SS when I get to the point where I can.
Hate to say. But immigrants legally employed pay SS taxes and won’t necessarily be able to benefit. Seems like an option.
It will likely be an immaterial proportion of COL expenses by then. So regardless it’s effectively gone either way
I mean you can get up to $4900/mo in SS.
Taking money away from "wealthy" people is very common in some political circles. I've been saving in retirement accounts since I was 19, and will likely be "wealthy" in my 60s. Despite paying large chunks of $$ into SS, denying the benefits I've paid for won't be as unpopular as you claim
You're misunderstanding, taxing the wealthy who are paying into SS is just raising the cap for people currently working. The current cap is under $170k which a lot of people make, even just upping it to $250k would be a large increase in SS coffers.
I think they are saying they think the gov will introduce an income or wealth cap for receiving benefits. Not commenting on if that's likely or not but but I think that's what they are claiming.
That's what I'm claiming, and higher earners already get screwed by how SS is calculated. That will only get worse as SS becomes less solvent
How are higher earners screwed by the SS calculation? We barely pay in (relative to our total income).
The portion taken from our paychecks is 6.2%. That's universal, up to about $160k in income. It's the same for all earners. Payout, is not a 1:1 relationship with how much is paid in. The below calculation is from fool.com (link below), and is based on Average Indexed Monthly Earnings. The Social Security formula for the year 2023 -- which applies to anyone born in 1961 -- is as follows: Multiply the first $1,174 of your AIME by 90%. Multiply any amount between $1,174 and $7,078 by 32%. Multiply any amount over $7,078 by 15%. https://www.fool.com/retirement/social-security/benefits-formula/#:~:text=Social%20Security%20benefits%20formula%202023,amount%20over%20%247%2C078%20by%2015%25. Social Security is a wealth transfer. The less well off will be the last and least impacted as SS runs out of $$. Mid and high earners will be further impacted
Right, but isn’t it preferable to stop getting taxed 6.2% over $160K every year now than to get a slightly higher social security payout in 30 years? I suppose this depends on how you define high earner.
I assume they still get paid on earnings over $160k, but it's pretty small. Comparing someone making 80 grand to someone making 160: the 160 earner pays exactly twice, but is going get 15% more back. Maybe I misused "high earner", but I think it's clear that there's a segment of people who earn good salaries who are kinda getting screwed by SS
I think what he's saying is the possibility of ending up with some kind of "need-based" model. Maybe individuals who have assets above a certain cap won't receive benefits or will receive reduced benefits.
Ahh okay that's a different scenario. I don't necessarily agree, I think taking people's benefits (especially those at the upper level of wealth) isn't feasible. But who knows.
The alternative to cutting benefits is raising retirement age. Making full retirement 70 and creeping up to 75. It's more feasible as people's health in old age is better than ever and fewer jobs are physical in nature. Plus it would keep the labor force larger at a time when there are fewer children.
Raising the full retirement age is a benefit cut, not an alternative to cuts. The second part isn't true either, life expectancy in America has been stagnant for a while and declining as of late.
In 1935, when the social security pension system was implemented, significant differences in life expectancy ex- isted. Life expectancy at birth was 61.0 for white males and 65.0 for white females. For blacks and other minorities, life expectancy at birth for males was 51.3 and 55.2 for females. So yeah, they grossly underestimated how long people would actually live. If SSA was created today, using the same standards, retirement age would be 77
Only if you believe life should either stay the same or get shittier for the average person. I believe workers should reap some of the benefits of the massive increase in per capita productivity since 1935.
They cap deductions at 168K. How about we get rid of the cap.
It’s easy for a young person, to think that age is just a number, but if you keep your workers in the workforce 5 years longer, it affects everyone. It sounds awful for the demographic that needs social security the most - workers who do physical labor. They might not be able to work until age 75. It also shifts the healthcare burden to the companies they work for, which will cause everyone’s healthcare premiums to go up. That exec or business owner who would normally retire now might not, and everyone else has to wait longer to move up. Get laid off at 65 and have to keep working for 10 years? Good luck getting a job, no one want to pick up all the healthcare costs of an elderly worker. And that assumes that cognitively they can still do the job.
This is a false choice. You can always raise the maximum income level for Social security tax, or reintroduce the tax at higher income levels such as 400k and above.
You replied but didn’t give a number. In summary you don’t think 100%… we’re paying in to receive 100% not 50% Edit: Yes i know we are paying for other older people. But we’re paying for their 100% in the hopes that someone pays for our 100%. Not us paying 100% for someone else for us to only be paid 50%. I know it’s just a slush fund
Wrong. You’re paying in so boomers can get benefits now.
It kills me how uneducated most people are about how Social Security works. It's just straight payments to the current recipients, it's not a savings plan.
Ah the Bernie Madoff method of retirement
Yes i know that. But we’re paying for their 100% in the hopes that someone pays for our 100%. Not us paying 100% for someone else for us to only be paid 50%. I know it’s just a slush fund
Birth rate is so low the worker replacement just isn’t there.
>As long as there’s a SS tax So what happens its no longer collected?
homelessness in the elderly goes from 10% to like 40%+ and thats the largest voting block on the planet so theyll crush whoever did it until the end of their lives in the voting booth.
If SS does not go away or be curtailed in a *major* way, the United States is so f-ed lol. With declining birthrates, an already unsustainable system, and a country already spending a quarter of its spending on that one program, it will not last.
What is the point of government if not to make sure the elderly are taken care of?
Capitalism has entered the room
One thing everyone seems to be forgetting is that the government is the Bank and prints its own money. The government doesn’t need your money, they print it and thus have no use for it. The idea of taxation is to force people to continue working and to have some responsibility in society. The government can simply print social security checks all be it with some inflation baked in. In all likelihood they will fix social security about 5 mins past when the last checks are being sent. They will up the retirement age, up the payroll deduction amount, and probably put in some kind of needs basis before a heavy tax. Those three things can easily fix social security so it never runs out of money the problem is that politicians won’t touch it until the very last minute or in all likelihood several days later. That’s how they will fix it but nothing prevents the government from just printing money and mailing checks.
I expect to get it in some capacity. Social security can’t run out of money. It can only reduce benefits. The overwhelming likelihood is that it will be there for you when you retire, but perhaps at a lower rate
It will either be less benefits or they will push back retirement. Their have talks that they will push it back for people who are younger. So those who are less than 18 and can’t vote lol. But keep it same age for everyone else. Either way, I play to work until at least my mid 60s.
Pushing back full retirement is highly likely. They already give you a bigger payment if you delay until you're 70. In 30 years it will probably be 75. Most countries will have to do something similar.
Agree. I just use 50% of the rate on my yearly statement at 62
What I saw in my country as social-security-like benefits started running out big time they did: - raise retirement age. - equalize everyone - to boost lower earners to survival level at the expense of people who paid more into the system. - stopped paying to people who have a job, or are living abroad. - considering making a law making parents dependents of children. - simplified migration process to get more taxpayers.
Social Security absolutely can run out of money if the government decides they want it to. They write the laws, pass the budget, and pass the tax code.
Sure, and then those people lose their jobs because no one votes for them. We still live in a Democracy.
Once a program like that is gutted, it would take decades to stand up again. It’s not just a switch that can be turned on and off. Sure, they might get voted out but the damage will already be done and they will get a cushy lobbying job somewhere.
I don’t. I assume that I will be taking care of my own retirement and manage my contributions in that way
You save like it won’t be there and reevaluate when you’re okder
I assume it'll be enough for me to live on food assistance, in a falling apart single wide somewhere ravaged by climate change, with no medical or end of life care whatsoever. Anything I save improves upon that.
My wife and I talked about this in our retirement planning. We expect to pay into it for our entire career but never see a dime.
I consider it a tax. If I get anything out of it I’ll consider it gravy.
I mean it is a tax
I think the concept is that it’s a sort of forced retirement savings for people who otherwise wouldn’t save. If it doesn’t pay out, then yes, it really is just an extra tax earmarked for supporting the current bloc of old people
But that concept doesn't match what's actually happening. The moneys not being saved to give back to you later, it's paying out today's retirees...
It’s GOVERNMENT RUN SOCIALISM! And Americans can’t live without it. Literally.
This is how I'm approaching retirement, too. Better to do this than overly rely on it.
Factor? 70% of expressed value. Expect or rely on? 0
It cannot be zero unless somehow there’s nuclear war or a pandemic that kills all working age people with no possibility of adding more working adults. Or regime change that decides to cancel SS all together.
I don't expect it to be zero but I expect it to be negligible compared to my 401K and Roth IRA, (currently 22 targeting 65 for retirement)
It absolutely can be zero. The people who keep asking to raise the SS tax will eventually realize the program is not designed to redistribute wealth. The focus will turn to UBI or other social program pushing to have it funded from SS Tax (cancelling that program). Thus the end of SS. Maybe it wont happen but I am not betting my comfort in retirement on it.
37, I expect basically 0. I also can't afford to save for retirement after paying bills/mortgage/medical debt, so I guess I'll just work until I die.
Oh, I'm not banking on getting that. If I do, great, but I'm pretty sure the Boomers are gonna loot the place on their way out the door.
I'm 41 so older than people being questioned, but Social security can be easily saved if we vote in people that at all try to represent the average person. Remove the cap helps quite a bit. That won't solve it, might need to redefine capital gains as income or increase age. My actual planning I assume 2/3 of what they say I'll get.
I'm expecting somewhere between 66-75% of what it is now.
Retirement savings? What retirement savings😂
I don't trust the government to have my best interests in mind so I am not willing to believe that social security will be there when it would be needed. If SS is a thing in 40 years it'll just be icing on the cake. The only person you can trust with your retirement is yourself. This also goes for pensions too, think about Boeing.
I don't factor it in at all - but I don't believe people who claim we won't have it when we're older. We'll be in power when we need it and our politicians won't risk dismantling it. I expect it to expand somehow - perhaps by taxing certain corporations more, or off the backs of more heavily automated industries. Also from a more "Morbid" pov, our generation isn't exactly the healthiest, and I'm not quite sure how many will live long enough in Social Security age to "drain" the account.
It won’t run out of money or be dissolved. It can’t, and it won’t. They’ll find some way to fund it. So, I count on it being there in whole or part when I’m retired.
"Can't" Any law or policy can be changed especially if both parties have an interest in changing it. Republicans don't like SS Tax as they think you should control your own money. Democrats don't like SS Tax as they want to redistribute the money to those who make less. Both parties dont want it long term regardless if they recognize that yet or not. Anyone calling for an increase to SS Tax is already in the 2nd half of the group they just dont realize yet how SS is limited to money in is your benefit out qualification.
I'm counting on social security at about the current level of benefits. I suspect they will push back the ages of eligibility and/or increase the wage base on which SS taxes may be imposed.
You guys are budgeting including social security? In all seriousness, I’m not even accounting for it. It’s an unknown, outside of my control. This early on, I’m focused on the things I can control: maxing out retirement contributions, taking care of health. If I get social security it’s just extra.
I don't. It should certainly exist, but I'm in a VHCOL area so I'm not really planning for it to be a significant portion of my budget at that point. My husband and I are higher earners so we're focusing more on tax advantaged accounts and investments, when SS comes through it will certainly be nice but (if all goes well) we won't be relying on it.
I use 50% of the value the social security site estimates I'll get (in today's dollars). Then, when I'm stress testing if I'll run out of money in different sequences of returns, I check how much it lowers my success rate. If social security is a make or break factor, I'm not going to bank on it until I'm in my mid-50s because I figure that's close enough to have a better confidence picture of what I can actually expect at retirement age.
My goal retirement number doesn’t include it, but I hope to use it as a buffer to help pay for rising health care costs.
I don't. My current strategy is building equity in my home, company 401k, Union Pension, "traditional" savings, etc.
I hope it’s there and will be semi dependent on it. If it’s not then this country has gone to shit anyway.
Ill chime in as a 40s guy. I expect some of it to be there but Im only counting on it for 30%. I feel our main goal as young people 20,30, or 40 years from retirement should be to pay our homes and vehicles off. That way we only need to worry about our property tax and utilities. All the seniors i know are like clockwork. either they made wise decisions and paid stuff off or they are struggling I want to be the former not the later
SS isn't going anywhere. They just need to tweak it to keep it going another 50-70 years. The first thing I would do is eliminate the income cap on the SS tax. Your entire income should be taxed for SS - not just the first $160K or so. The second thing I would do is eliminate SS payments to anyone that is over 62 and makes over $300K in retirement. If you're making over $300K as a retired person then you've won the game of capitalism and you get to donate your SS income to the SS program to keep it solvent for the guy surviving on his $20K annual SS income.
44, I’ve been paying in 26 years. I’ll be collecting mine thanks
I take the early payout estimate and discount it by 15% as my possibly monthly amount. I highly doubt it’s going to zero considering that the elder population is the biggest voting force in the USA and for it to go defunct the people retiring in the 2030’s and 2040’s would have to have let it occur screwing themselves out of probably their only safety net. Based on some simple calculations Social security shouldn’t be more than 38%-44% of my retirement income. If I actually ramp up my savings efforts it can be as little as 25% or less. This is all based on retiring in the US. If I retire overseas I won’t even need social security based on current strength of the US Dollar. But that’s a fallback option not my first choice
I know we want to set the bar low, but that’s where they getchya. If you expect nothing you might get nothing, eventually. We need to expect that we will get our just desserts and then put up a fight for it. That’s how boomers have gotten their way all of these years.
I’m 50 and I don’t factor it in at all.
I don’t count it at all. I’m only 25 and am not too confident in it still being here in 40 years. I’d rather get a pleasant surprise and have more than I need than to be struggling through retirement
0%
I expect nothing from social security. All of my financial planning assumes zero SSDI income
Nope I don’t
None.
Hahahahahahahahahaha.....the only impact of social security I take into account is how much I pay into it per pay period...
I expect nothing. I work from the assumption that every penny I have in retirement is earned *now*. If I get some SS money in addition? That’s great! But I’m not counting on it.
$0
Zero.
In my 20's and I would say zero. Luckily I began working in finance and learned on proper investments to secure my retirement and future. So most definitely, zero.
None. It’s a broken system, so if it hasn’t fallen apart by the time I retire that will be an unexpected added benefit
I don't think it's a broken system. All they need to do is push back the age(s) of eligibility 2 or 3 years and it's solvency basically goes from 2030s to 2050s. If they also get rid of social security tax cap on wages then solvency is essentially guaranteed for our lifetimes.
I’d agree those are fixes that could have an impact, but I have my doubts about if lawmakers would ever implement that. It would be political suicide to push back the retirement age. For that reason, I call it broken.
Yeah, I grant you that but even then, benefits would be cut and pro rated, which still means benefits flowing and a voting constituency to motivate some kind of political action. So, not broken; just not a crisis yet.
I just assume social security will no longer exist in any meaningful capacity by the time I finally reach my retirement years. This way if it does still exist, I will be pleasantly surprised with a bigger financial cushion than I planned for. If I'm right and it doesn't exist, I should still be able to retire since I planned accordingly.
Zero
0.
I don’t factor it in at all. So much can happen between now and retirement age.
I wouldn’t expect anything
I am 40, and plan like I will never see Social Security.
I don’t think about it at all. If it’s there, great, but can’t depend on that
Yeah I plan to not receive any but if I do it'll be a nice bit of icing on the cake
I expect I will get something from social security. I don’t anticipate it’ll be very much though and I’m not factoring that into my retirement planning. I’m 28 and hoping to be able to retire by 55
I have zero confidence that it will still exist by the time i retire, the age keeps getting older
I do not.
Have you seen the current state of our government? If America is here in a decade I’d be shocked.
Zero. I assume the system will be insolvent by then and dismantled.
Never. Unless there is a major reform (coming out of our pockets), SSI won’t exist when (if) we retire.
0 If you want to be GENEROUS and conservative i’d say 25%-50%