That depends on the definition of "flat bust"
If you haven’t followed the news closely, you may have missed a growing controversy about whether the government is going to pay you a few hundred thousand dollars it owes you.
According to the Wall Street Journal, the White House “strongly argues that Social Security benefits paid to future retirees must be significantly reduced.”
That’s right! The White House wants to cut back OUR benefits—by a lot. They don’t think we can afford them. Did you know?
Of course, it’s a lot easier to take something away from people if they don’t think they’re going to get it anyway. Which explains why the President is now campaigning around the country saying things like:
“If you're 20 years old, in your mid-20's, and you're beginning to work, I want you to think about a Social Security system that will be flat bust, bankrupt, unless the United States Congress has got the willingness to act now.”
Well then, let’s think about it! We can do the math.
All right. A 25-year-old starts collecting Social Security at age 67. (Yes! 67. They already hiked our retirement age…)
According to the Social Security Administration, which is responsible for official government projections, Social Security can pay 100% of benefits until 2042. After that the tax at its current rate can fund benefits at about 70% throughout the century (long after that 25 year old is dead and gone). Official budget analysts for Congress disagree: they say Social Security is 100% funded until 2052, and can pay out nearly 80% after that.
So the 25 year old retires in 2046 and gets…at least 70% of benefits. Which amounts to hundreds of thousands of dollars.
How can this be? After all, we’ve heard all our lives that Social Security is going to be “bankrupt” when it is our turn to collect. Maybe you even saw that ad on CNN saying there won’t be enough workers in the future to pay for all the retirees.
Well… it turns out that, even with those demographics, there are still enough people paying into the system to pay for most of our benefits. Not all, but most. Until long after we are dead and gone.
Back to the President of the United States—given the facts, what is your take on what he said?
What’s your definition of “flat bust”?
According to the Wall Street Journal, the White House “strongly argues that Social Security benefits paid to future retirees must be significantly reduced.”
That’s right! The White House wants to cut back OUR benefits—by a lot. They don’t think we can afford them. Did you know?
Of course, it’s a lot easier to take something away from people if they don’t think they’re going to get it anyway. Which explains why the President is now campaigning around the country saying things like:
“If you're 20 years old, in your mid-20's, and you're beginning to work, I want you to think about a Social Security system that will be flat bust, bankrupt, unless the United States Congress has got the willingness to act now.”
Well then, let’s think about it! We can do the math.
All right. A 25-year-old starts collecting Social Security at age 67. (Yes! 67. They already hiked our retirement age…)
According to the Social Security Administration, which is responsible for official government projections, Social Security can pay 100% of benefits until 2042. After that the tax at its current rate can fund benefits at about 70% throughout the century (long after that 25 year old is dead and gone). Official budget analysts for Congress disagree: they say Social Security is 100% funded until 2052, and can pay out nearly 80% after that.
So the 25 year old retires in 2046 and gets…at least 70% of benefits. Which amounts to hundreds of thousands of dollars.
How can this be? After all, we’ve heard all our lives that Social Security is going to be “bankrupt” when it is our turn to collect. Maybe you even saw that ad on CNN saying there won’t be enough workers in the future to pay for all the retirees.
Well… it turns out that, even with those demographics, there are still enough people paying into the system to pay for most of our benefits. Not all, but most. Until long after we are dead and gone.
Back to the President of the United States—given the facts, what is your take on what he said?
What’s your definition of “flat bust”?
posted by Hans Riemer at 5:50 PM
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