Republicans should propose to phase out SS and replace it with this proven plan.

Nostra

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Oct 7, 2019
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4 counties in TX opted out of SS before Congress outlawed it. They set up their own system and the results speak for themselves.

Who here would choose SS over this plan?

But the Alternate Plan takes a different approach, one I call a “banking model.” Employee and employer contributions are actively managed by a financial planner—in this case, First Financial Benefits, Inc., of Houston, which both originated the plan and has managed it since inception.

The contributions are pooled, like bank deposits, and top-rated financial institutions bid on the money. Those institutions guarantee an interest rate that won’t go below a base level, and could go higher if the market does well. Over the last decade, the accounts have earned between 3.75 percent and 5.75 percent every year, with an average of around 5 percent. The 1990s often saw even higher interest rates, 6.5 to 7 percent. Thus, when the market goes up, employees make more; and when the market goes down, employees still make something.

Like Social Security, employees contribute 6.2 percent of their income, with the county matching the contribution (Galveston has chosen to provide a slightly larger share). Once the county makes its contribution, its financial obligation is done. So there are no long-term unfunded liabilities.

But not all of that money goes into an employee’s retirement account. When financial planner Rick Gornto devised the Alternate Plan in 1981, he wanted it to be a complete substitute for Social Security. And Social Security isn’t just a retirement fund; it’s social insurance that provides a death benefit—a whopping $255—survivors’ insurance, and a disability benefit.

Part of the employer contribution in the Alternate Plan goes toward a term life insurance policy, which pays four times the employee’s salary tax free, up to a maximum of $215,000. That’s nearly 850 times Social Security’s death benefit.

More importantly, if a worker participating in Social Security dies before retirement, he loses his contribution (though part of that money might go to surviving children, if any, or a spouse who didn’t work and therefore didn’t establish his or her own benefits). But a worker in the Alternate Plan owns his account, so the entire account belongs to the estate. There is also, among other benefits, a disability benefit that pays immediately upon injury, rather than waiting six months, plus other restrictions, as under Social Security.

And those who retire under the Galveston model do much better than Social Security. For example:


  • A lower-middle income worker making about $26,000 at retirement would get about $1,007 a month under Social Security, but $1,826 under the Alternate Plan, according to First Financial’s calculations.
  • A middle-income worker making $51,200 would get about $1,540 monthly from Social Security, but $3,600 from the banking model.
  • And a high-income worker who maxed out on his Social Security contribution every year would receive about $2,500 a month from Social Security vs. $5,000 to $6,000 a month from the Alternate Plan.
What the Alternate Plan has demonstrated over 30 years is that personal retirement accounts work, with many retirees making more than twice what they would have made under Social Security. And that model could work for the roughly 25 percent of public employees—about 6 million people—who are part of state and local government retirement plans. It could also serve as a model for reforming Social Security.

 
This Forbes article is form 2011, so with the way the stock market has gone since then these retirees are much better off than the numbers in the article.

Meanwhile, SS recipients rely on the occasional COLA increase.
 
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As much as my 401K is bleeding value with 10 percent going in, I sure doubt that I would fair any better if the 6.2 or 12.4 depending on your situation would magically do anything other than throw PE' really out of whack.
 
This Forbes article is form 2011, so with the way the stock market has gone since then these retirees are much better off than the numbers in the article.

Meanwhile, SS recipients rely on the occasional COLA increase.
There is no money to invest because Republicans raided the trust fund to pay for tax cuts & wars leaving zero interest IOU's. This is why stocks went up. Those magic fantasy numbers can't cover everyone.
 
There is no money to invest because Republicans raided the trust fund to pay for tax cuts & wars leaving zero interest IOU's. This is why stocks went up. Those magic fantasy numbers can't cover everyone.
Where is there no money to invest?
 
I would chose the plan that would give me 2-3 times the monthly payout, a death benefit 850 times higher, and the ability to leave several hundred thousand to my heirs over SS.
 
Bush floated a trial balloon for this kind of reform and Pelosi and Senator Reid beat him to death with it and the media helped them... however if they had reformed SS when and how Bush proposed back then it wouldn't be running out of money and people retiring today would be making bank baby... and Pelosi and Reid and the dems blocked any reform....
 
That was 40 years ago and operates with a very small (relatively) number of people. You still have refused to answer how you would fund SS for people like me. We are waiting.
No stupid, it's going on today. It started 40 years ago. You can't explain how it is without a shadow of a doubt unworkable.

And who is "we", Simp?
 
Still waiting for all the board Dimwingers who would choose retirement under SS over this plan:

Clipper
meaner gene
Faun
KissMy
BlindBoo
Here ya go FS.

Social Security Administration/Founded
August 14, 1935, United States.

If NOT for SS, the elderly would have NO additional income. SS is Future Forced Income.
I started contributing to SS at 16, now 61. In 1987. You?
If one dies early ( 50's 60's) they miss out on contributions versus recovery gains.
And Vice Versa, of One living to be 100.

It was started 88 yeas ago, for FORCED protection. Retirement Assurance.
If NOT for the FORCED protection, the elderly may or may have not saved in the traditional Stock Market we know of today.

Now, me being born in '61, probably would have LOVED the
'I'm not forced to pay into SS, and I can invest as I wish"
Cuz the Market has soared, regardless of POTUS.

But, Nostra , I'm accepting the FLAWS in SS to protect my Parents and Grandparents.

Are you denying this?
Waiting>>>>>>>>>>>...........Go.
 
I thought it was a rhetorical question. You get more money under that plan. Who wouldn't take that plan if they had the choice?

I'd invest in both plans. There's nothing that says you can't. Even if you have to sent the SSA a check ever so often.
 

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