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Politics : Formerly About Advanced Micro Devices
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To: Alighieri who wrote (212826)12/7/2004 9:46:49 AM
From: RetiredNow  Read Replies (2) of 1572673
 
That is a guy who doesn't understand finance. I wish everyone in this country had at least one finance class under their belts, then we could all have an intelligent debate about SS.

What is really happening is this. SS is currently running a surplus, that is true. But your SS contributions ARE NOT tagged to your social security number. Instead your contributions go into an SS trust fund that is used to pay current retirees. So when the baby boomers retire in mass over the next 15-20 years, that surplus will not only turn into a deficit, but the baby boomers will deplete the trust fund.

The only way to save SS is to start privatizing portions of it now. What that means is diverting some percentage of the contribution to an account tagged to people's SS # and let them invest it at higher rates. That will do two things: 1) reduce the unfunded SS obligation by the diverted amount plus growth and 2) allow the recipient to earn more money on their money by getting a better return than the avg 2% the gov't gives us.

It's simple math, but everyone makes it out to be so complex. All of this could have been avoided had the architects of the SS plan just tagged each person's contributions to the system to their SS #. But they meant it to be social welfare, which is never long term sustainable.
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