Average American Pays Less into SS and Medicare than They Receive

[Truthmatters]

It is estimated that for the average couple aged 65, each earning $43,500 a year, over their lifetime, they will on average pay $598,000 in SS taxes and receive $556,000 in SS benefitsThey will pay $119,000 in Medicare taxes and receive $357,000 in Medicare benefits. In total, the couple will pay $717,000 in taxes and $913,000 in benefits, or $196,000 more than they received.



One is OK the other doesnt work

So, TMN thinks it's fine that people receive less than they pay in for SS, and should have the same arrangement for Medicare.

Got it.

The couple would have been better off keeping and investing the money in their own retirement accounts. The SS has a negative return; the Medicare portion has a hugely distorted cost structure due to government interference.

SS does not have a negative return.

He da man

 

[Listening]

your numbers show SS paying fro its self Toro.

So why did President Obama say he could not guarantee that social security checks would go out in early August because of the debt ceiling issue ?

Sounds like month to month to me.

Please help me out here.

Umm getting those checks out requires human workers and if the govt is shut down and those workers are not working...

You really want to hold to that position ?

I'd like something that specifically calls it out.

Otherwise, you have this kind of reporting:

Obama says he cannot guarantee Social Security checks will go out on August 3 - Political Hotsheet - CBS News

"I cannot guarantee that those checks go out on August 3rd if we haven't resolved this issue. Because there may simply not be the money in the coffers to do it," Mr. Obama said in an interview with CBS Evening News anchor Scott Pelley, according to excerpts released by CBS News.

.....

And this.....

Debt ceiling: Will I get my Social Security check? - Jul. 28, 2011

which talks about needing money to cover the checks, not mail them.

I think your statement is incorrect.

 

[Sundial]

1. In January 2000, the Dow was at 11,722.98. Today it closed at 10992.13. In 11.5 years, in other words, it lost value.

In 2008 it lost 39%, in that year alone.

Social Security is a guaranteed income. Its purpose is not to make you rich. Its purpose is to keep you out of poverty, if things don't turn out the way you plan. It's taken for granted now, but there are millions of people whose lives would be desperately worse without it.

2. Of course people collect more from Social Security than what they pay in. Some people die without collecting benefits.

3. The Social Security Trust Fund is invested in government bonds - the safest investment there is. In its entire history, the US has never defaulted on its bonds. Yes, it could happen in the future, but ultimately we have to trust in the good sense of the American people to stop voting for Republicans. If we choose to put people in power who are trying to destroy the country, eventually they'll succeed. But in that case, we're fucked no matter what we do.

 

[Sundial]

So why did President Obama say he could not guarantee that social security checks would go out in early August because of the debt ceiling issue ?

Sounds like month to month to me.

Please help me out here.

Umm getting those checks out requires human workers and if the govt is shut down and those workers are not working...

You really want to hold to that position ?

I'd like something that specifically calls it out.

Otherwise, you have this kind of reporting:

Obama says he cannot guarantee Social Security checks will go out on August 3 - Political Hotsheet - CBS News

"I cannot guarantee that those checks go out on August 3rd if we haven't resolved this issue. Because there may simply not be the money in the coffers to do it," Mr. Obama said in an interview with CBS Evening News anchor Scott Pelley, according to excerpts released by CBS News.

.....

And this.....

Debt ceiling: Will I get my Social Security check? - Jul. 28, 2011

which talks about needing money to cover the checks, not mail them.

I think your statement is incorrect.

The reason Obama could not guarantee that the checks would go out is that the Social Security Trust Fund is invested in Treasury bonds. Treasury bonds are obligations of the US government. When the Trust Fund cashes in Treasury bonds, it gets money from the US government. Had the Republicans succeeded in bankrupting the government, the government - because of lack of money - would not have been able to meet all its obligations - including the obligation to pay the Trust Fund.

Obama probably could have shifted money around, so the checks could go out, more or less on time. But making public decisions ahead of time about who was going to get shafted was not a position Obama wanted to put himself in. Obviously the Republicans were doing everything possible to get him to do exactly that, but he's not that dumb.

 

[Listening]

The reason Obama could not guarantee that the checks would go out is that the Social Security Trust Fund is invested in Treasury bonds. Treasury bonds are obligations of the US government. When the Trust Fund cashes in Treasury bonds, it gets money from the US government. Had the Republicans succeeded in bankrupting the government, the government - because of lack of money - would not have been able to meet all its obligations - including the obligation to pay the Trust Fund.

Obama probably could have shifted money around, so the checks could go out, more or less on time. But making public decisions ahead of time about who was going to get shafted was not a position Obama wanted to put himself in. Obviously the Republicans were doing everything possible to get him to do exactly that, but he's not that dumb.

In other words, there is no pile of cash sitting in a vault somehwhere that the government can get at.

The IOU's might as well not exist as it sounds as if the government needs the money to pay itself month to month. S.S. is just a part of the system and the IOU's are nothing more than funny money.

What a shame and what a sham (and this has nothing to do with President Obama).;

 

[jillian]

...Social Security is good for us so we should be grateful and not complain about being forced to pay for something we never asked for but Toro knows is best for us.

My next guess is that Toro hasn't convinced anyone.

You're wrong...

Wrong about what, that I don't want Social Security or that you're not convincing anyone?

i love when rightwingnut idiots try to argue with people in their area of expertise. you don't have to agree with him philosophically. you do have to accept his facts as facts.

as for convincing, i'm pretty sure that idiots ignore facts all the time. so it's not like facts would convince you anyway.

and anyone who knows his expertise would find him persuasive, at least, even if they continue to disagree with him philosophically.

 

[edthecynic]

The reason Obama could not guarantee that the checks would go out is that the Social Security Trust Fund is invested in Treasury bonds. Treasury bonds are obligations of the US government. When the Trust Fund cashes in Treasury bonds, it gets money from the US government. Had the Republicans succeeded in bankrupting the government, the government - because of lack of money - would not have been able to meet all its obligations - including the obligation to pay the Trust Fund.

Obama probably could have shifted money around, so the checks could go out, more or less on time. But making public decisions ahead of time about who was going to get shafted was not a position Obama wanted to put himself in. Obviously the Republicans were doing everything possible to get him to do exactly that, but he's not that dumb.

In other words, there is no pile of cash sitting in a vault somehwhere that the government can get at.

The IOU's might as well not exist as it sounds as if the government needs the money to pay itself month to month. S.S. is just a part of the system and the IOU's are nothing more than funny money.

What a shame and what a sham (and this has nothing to do with President Obama).;

There is a pile of cash only when CON$ want to claim that Bush had a deficit of only $160 billion in 2007 rather than $500 billion, then suddenly SS is a real asset. For all other arguments CON$ say SS is broke.

 

[Truthmatters]

1. In January 2000, the Dow was at 11,722.98. Today it closed at 10992.13. In 11.5 years, in other words, it lost value.

In 2008 it lost 39%, in that year alone.

Social Security is a guaranteed income. Its purpose is not to make you rich. Its purpose is to keep you out of poverty, if things don't turn out the way you plan. It's taken for granted now, but there are millions of people whose lives would be desperately worse without it.

2. Of course people collect more from Social Security than what they pay in. Some people die without collecting benefits.

3. The Social Security Trust Fund is invested in government bonds - the safest investment there is. In its entire history, the US has never defaulted on its bonds. Yes, it could happen in the future, but ultimately we have to trust in the good sense of the American people to stop voting for Republicans. If we choose to put people in power who are trying to destroy the country, eventually they'll succeed. But in that case, we're fucked no matter what we do.

Good post sunny but they do actually PAY IN MORE than they collect.

 

[Sundial]

The reason Obama could not guarantee that the checks would go out is that the Social Security Trust Fund is invested in Treasury bonds. Treasury bonds are obligations of the US government. When the Trust Fund cashes in Treasury bonds, it gets money from the US government. Had the Republicans succeeded in bankrupting the government, the government - because of lack of money - would not have been able to meet all its obligations - including the obligation to pay the Trust Fund.

Obama probably could have shifted money around, so the checks could go out, more or less on time. But making public decisions ahead of time about who was going to get shafted was not a position Obama wanted to put himself in. Obviously the Republicans were doing everything possible to get him to do exactly that, but he's not that dumb.

In other words, there is no pile of cash sitting in a vault somehwhere that the government can get at.

The IOU's might as well not exist as it sounds as if the government needs the money to pay itself month to month. S.S. is just a part of the system and the IOU's are nothing more than funny money.

What a shame and what a sham (and this has nothing to do with President Obama).;

No, there's no pile of cash. Bush said US bonds are just pieces of paper. Well, what does he think cash is? Bonds are lawful obligations of the US government. There's no reason (outside of Republican shenanigans) why the US would default on those obligations, and there's no reason why it should.

The difference between cash and bonds is that bonds pay interest. Keeping a big pile of cash in a room somewhere would be financial mismanagement.

 

[Sundial]

1. In January 2000, the Dow was at 11,722.98. Today it closed at 10992.13. In 11.5 years, in other words, it lost value.

In 2008 it lost 39%, in that year alone.

Social Security is a guaranteed income. Its purpose is not to make you rich. Its purpose is to keep you out of poverty, if things don't turn out the way you plan. It's taken for granted now, but there are millions of people whose lives would be desperately worse without it.

2. Of course people collect more from Social Security than what they pay in. Some people die without collecting benefits.

3. The Social Security Trust Fund is invested in government bonds - the safest investment there is. In its entire history, the US has never defaulted on its bonds. Yes, it could happen in the future, but ultimately we have to trust in the good sense of the American people to stop voting for Republicans. If we choose to put people in power who are trying to destroy the country, eventually they'll succeed. But in that case, we're fucked no matter what we do.

Good post sunny but they do actually PAY IN MORE than they collect.

Well, collectively Americans have paid in more than they've taken out, otherwise there wouldn't be a surplus. But that's not the same as whether someone who makes it to 65 will get more or less than he paid in. If you make it to 65, live 15 more years, and collect $1000/month, that's 180K. If you paid 7.5% for 40 years on 30k average salary, that's 90k. That's just an example, but the numbers aren't wildly unrealistic.

 

[flacaltenn]

Toro:

There is no doubt that the first workers into the program benefitted much more than later workers. In fact -- that's still true and not in debate. However -- even the first graph in your link shows that the ROI gap for even the AVERAGE worker is rapidly closing to nothing (historically).

Coupla of problems with this analysis as it is..

1) Can't find whether the EMPLOYER contributions are included. Those are REAL TAXES and income to the fund. They've convieniently buried that important point.

2) There is a fiction that ::

The “lifetime value of taxes” is based upon the value of accumulated taxes, as if those taxes were put into an account that earned a 2 percent real rate of return (that is, 2 percent plus inflation). The “lifetime value of benefits” represents the amount needed in an account (also earning a 2 percent real interest rate) to pay for those benefits.

So that one is led to believe that the INTEREST just appeared as the genie rubbed the lamp. In reality, the interest came from the same cohort of taxpayers.

The REAL problem is for folks that follow the baby boomers into the abyss. The break even point WILL BE even lower than $46K. Perhaps as low as $30K or so. THERE is the problem.. It's been a wonderful ride right up onto the canyon wall that we all saw coming 50 years ago.

NOTHING is guaranteed.. Even if EDITEC guarantees it. Not the retirement age. Not the benefits. Not your "premium". Not the taxes on the distributions. Not the terms of "means testing" your eligibility, not the "rate of return" on future "trust fund" interest, Not even the ability of the Govt to issue future debt to cover excess liabilities. For ALL of this uncertainties you are under the whims and wisdom of the Great Potomac Clown College..

 

[Wiseacre]

As I understand it, the SS Trust Fund in total is paying out more than it takes in. According to the CBO, the trust fund will be exhausted in 2036, or thereabouts. Isn't that really the point, the SS program needs to be adjusted so that the fund will remain solvent.

The Trust Fund has about 2.5 trillion in IOUs, mostly in US Treasuries I believe. So, if the SS payout exceeds the payin, then those IOUs get redeemed and the US Treasury has to borrow more money to transfer into the the SS Trust Fund. But here's the real deal, under the current law once those IOUs run out then the trust fund can only payout what it takes in. Say what you want, the program should be changed in some way to avoid that day.

 

[expat_panama]

...Social Security is a guaranteed income. Its purpose is not to make you rich. Its purpose is to keep you out of poverty, if things don't turn out the way you plan...

That's nice. We still don't want it.

65% Believe Americans Should Have Right to Pick Own Social Security Retirement Age - Rasmussen Reports™

Six in 10 Workers Hold No Hope of Receiving Social Security

Up til now the SS sales people have been forcing us to buy their product but we're putting a stop to it. It's over.

 

[jillian]

...Social Security is a guaranteed income. Its purpose is not to make you rich. Its purpose is to keep you out of poverty, if things don't turn out the way you plan...

That's nice. We still don't want it.

65% Believe Americans Should Have Right to Pick Own Social Security Retirement Age - Rasmussen Reports™

Six in 10 Workers Hold No Hope of Receiving Social Security

Up til now the SS sales people have been forcing us to buy their product but we're putting a stop to it. It's over.

"we"?

actually 70% want you to keep your hands off of social security and medicare last i checked.

more than 50% of senior citizens lived below the poverty line prior to social security.

the rightwingnuts lost this battle a long time ago.

maybe when you grow up, you'll do better.

 

[editec]

Toro:

There is no doubt that the first workers into the program benefitted much more than later workers. In fact -- that's still true and not in debate. However -- even the first graph in your link shows that the ROI gap for even the AVERAGE worker is rapidly closing to nothing (historically).

Coupla of problems with this analysis as it is..

1) Can't find whether the EMPLOYER contributions are included. Those are REAL TAXES and income to the fund. They've convieniently buried that important point.

2) There is a fiction that ::

The “lifetime value of taxes” is based upon the value of accumulated taxes, as if those taxes were put into an account that earned a 2 percent real rate of return (that is, 2 percent plus inflation). The “lifetime value of benefits” represents the amount needed in an account (also earning a 2 percent real interest rate) to pay for those benefits.

So that one is led to believe that the INTEREST just appeared as the genie rubbed the lamp. In reality, the interest came from the same cohort of taxpayers.

The REAL problem is for folks that follow the baby boomers into the abyss. The break even point WILL BE even lower than $46K. Perhaps as low as $30K or so. THERE is the problem.. It's been a wonderful ride right up onto the canyon wall that we all saw coming 50 years ago.

NOTHING is guaranteed.. Even if EDITEC guarantees it. Not the retirement age. Not the benefits. Not your "premium". Not the taxes on the distributions. Not the terms of "means testing" your eligibility, not the "rate of return" on future "trust fund" interest, Not even the ability of the Govt to issue future debt to cover excess liabilities. For ALL of this uncertainties you are under the whims and wisdom of the Great Potomac Clown College..

I guarantee nothing except this...if social secutrity is broke, then so too is this nation.

If the people who LENT this nation money ( via SS) cannot get paid for their contributions?

Then why should the USA pay any any of its OTHER debtors?

Should we pay CHINA but NOT American citizens?

That appears to be what some of you are proposing.

 

[expat_panama]

...We still don't want it.

65% Believe Americans Should Have Right to Pick Own Social Security Retirement Age - Rasmussen Reports™

Six in 10 Workers Hold No Hope of Receiving Social Security...

"we"? actually 70% want you to keep your hands off of social security and medicare last i checked...

--meaning you didn't check the links provided. No problem, there's been a big shift in voting trends that will speak for itself and make this debate superfluous.

 

[flacaltenn]

Toro:

There is no doubt that the first workers into the program benefitted much more than later workers. In fact -- that's still true and not in debate. However -- even the first graph in your link shows that the ROI gap for even the AVERAGE worker is rapidly closing to nothing (historically).

Coupla of problems with this analysis as it is..

1) Can't find whether the EMPLOYER contributions are included. Those are REAL TAXES and income to the fund. They've convieniently buried that important point.

2) There is a fiction that ::

The “lifetime value of taxes” is based upon the value of accumulated taxes, as if those taxes were put into an account that earned a 2 percent real rate of return (that is, 2 percent plus inflation). The “lifetime value of benefits” represents the amount needed in an account (also earning a 2 percent real interest rate) to pay for those benefits.

So that one is led to believe that the INTEREST just appeared as the genie rubbed the lamp. In reality, the interest came from the same cohort of taxpayers.

The REAL problem is for folks that follow the baby boomers into the abyss. The break even point WILL BE even lower than $46K. Perhaps as low as $30K or so. THERE is the problem.. It's been a wonderful ride right up onto the canyon wall that we all saw coming 50 years ago.

NOTHING is guaranteed.. Even if EDITEC guarantees it. Not the retirement age. Not the benefits. Not your "premium". Not the taxes on the distributions. Not the terms of "means testing" your eligibility, not the "rate of return" on future "trust fund" interest, Not even the ability of the Govt to issue future debt to cover excess liabilities. For ALL of this uncertainties you are under the whims and wisdom of the Great Potomac Clown College..

I guarantee nothing except this...if social secutrity is broke, then so too is this nation.

If the people who LENT this nation money ( via SS) cannot get paid for their contributions?

Then why should the USA pay any any of its OTHER debtors?

Should we pay CHINA but NOT American citizens?

That appears to be what some of you are proposing.

That's not how it plays out Editec.. Won't come down to paying China or seniors. (But if it did -- China would win because the USA not meeting it's INTERNAL obligations is a default that the rest of the rest of world will snooze right thru).

There is so LITTLE guaranteed in the Soc Sec scheme, that premiums can be raised, ages can be extended, caps can come off, COLAs can be junked, payments can be taxed and means tested and pretty soon it's UNRECOGNIZABLE as your parents saw it. The program as conceived by FDR less than one human lifetime ago will be left mugged and beaten (but surviving) in a DC back alley. This stuff is GONNA happen..

It's REALLY sad that people trivially flip-off with "just raise the retirement age because everyone is living longer".. Sorry buds, that's NOT something the Clown College is gonna decide for me. If I'm LIVING LONGER -- doesn't neccessarily mean I want the govt to FORCE ME to WORK LONGER. That's not their call. And it would NEVER be the case if I was totally in charge of my financial planning.

I guarantee nothing except this...if social secutrity is broke, then so too is this nation.

YES -- the nation is looking at 15 or 20 years of MAJOR cash flow "problems".. Your guarantee editec is "as good as gold"

 

[signelect]

If a person dies before they start to receive benefits the money they paid in is stolen by congress. When Johnson and congress stole the fund in the 60's it started down hill. What they did was illegal in private industry and they should all have gone to jail.

 

[Listening]

No, there's no pile of cash. Bush said US bonds are just pieces of paper. Well, what does he think cash is? Bonds are lawful obligations of the US government. There's no reason (outside of Republican shenanigans) why the US would default on those obligations, and there's no reason why it should.

The difference between cash and bonds is that bonds pay interest. Keeping a big pile of cash in a room somewhere would be financial mismanagement.

I don't keep my checkbook balance at zero and you would think that the federal government would keep a couple of months of cash for entitlement payments in reserve...just in case.

That such money is not available should tell everyone that the accrual in the trust fund is nothing more than additional money spent on "other things" that can only be replaced by raising revenue.

While I was not happy with the GOP's "no taxes" stance during the debt crisis, it is when I ponder this kind of thing that I realize they were probably correct to take such a position.

Congress just can't seem to keep a dollar in their pockets.