Associated Press: Youth support for private accounts falls
Poll: Reduced support for Social Security accounts among young adults
WASHINGTON (AP) — Support for President Bush's plan to create personal Social Security retirement accounts which might include stocks or mutual funds has dropped over the last month among Americans under age 30, according to a poll released Thursday.
Young adults have been the strongest supporters of the proposal for months. Support among those 18-29 dipped from seven in 10 to just under half, according to the poll by the Pew Research Center for the People & the Press. A quarter of young adults now say they're not sure how they feel about such personal accounts.
The poll found that just over four in 10, 44%, of all those polled, support creation of the accounts, down from 54% in December, while 40% are opposed.
The amount of support for the plan differs widely depending on how the question is worded.
When poll questions mention that people will have a reduced guaranteed benefit with the accounts, the support dips into the 30s with a majority opposing the plan. When the question emphasizes only the positive aspects of accounts, some GOP polls have found a majority supporting accounts.
Polls find a healthy majority agree that Social Security faces long-range problems.
The Pew poll of 1,505 adults was taken March 17-21 and has a margin of sampling error of plus or minus 3 percentage points.
WASHINGTON (AP) — Support for President Bush's plan to create personal Social Security retirement accounts which might include stocks or mutual funds has dropped over the last month among Americans under age 30, according to a poll released Thursday.
Young adults have been the strongest supporters of the proposal for months. Support among those 18-29 dipped from seven in 10 to just under half, according to the poll by the Pew Research Center for the People & the Press. A quarter of young adults now say they're not sure how they feel about such personal accounts.
The poll found that just over four in 10, 44%, of all those polled, support creation of the accounts, down from 54% in December, while 40% are opposed.
The amount of support for the plan differs widely depending on how the question is worded.
When poll questions mention that people will have a reduced guaranteed benefit with the accounts, the support dips into the 30s with a majority opposing the plan. When the question emphasizes only the positive aspects of accounts, some GOP polls have found a majority supporting accounts.
Polls find a healthy majority agree that Social Security faces long-range problems.
The Pew poll of 1,505 adults was taken March 17-21 and has a margin of sampling error of plus or minus 3 percentage points.
posted by Hans Riemer at 10:33 PM
4 Comments:
Maybe if you were honest enough to report the facts about how America's youth are actually going to lose money they get stolen from their paychecks "for their own good", they'd realize that they ought to be able to save for retirement in the manner they see fit.
To see just how badly you're gonna get ripped off, click here.
www.socialslavery.com
Unfortunately the poll fails to mention that social security benefits themselves are NOT GUARANTEED. They are subject to the whims of Congress who can decide to change benefits at any time. However, private accounts not only provide a MUCH GREATER income when you retire, they are also GUARANTEED. It's your money no matter what happens to you.
If you die before your start drawing social security, what happens to your money? It's gone. With private accounts, you can pass it to your children, your spouse, whomever you want to pass it to.
Why are private accounts good for you?
Over it's entire history, the stock market has averaged 10% per year. This includes the crash of 1929, as well as all of the more recent recessions. If you look at any 5 year period, 95% of them have made money. This again includes the crashes. One hundred percent of all 10-year periods have made money. Not always 10%, but certainly higher than the 1.5% that social security brings, assuming you live long enough to collect it.
With well-managed mutual funds, the risk is greatly reduced and the returns can be higher than 12%. Remember these funds are managed by people whose job it is to make money for you. If they can't out-perform the stock market average, they are going to be out of a job.
How much money would I make under the current system?
Take a person 22 years old who gets a job making $24,000/year. Their monthly social security tax would be $124. When they retire, assuming that they never get a raise, they would receive $16,992 per year. This assumes that the current retirement rules, including the wage indexing rather than price indexing, remain the same, which is extremely unlikely. Your actual return will probably be less.
How much money could I have with a private account?
Take the same 22 year old making $24,000/year for the rest of his/her working career. If they were allowed to invest 4% of your income in a private account, that would be $80/month. Their social security benefits yould be reduced to $5,264/year after switching to price indexing, which means that this is the minimum you will receive.
However, you are investing $80/month in a private account (4% of 24,000). Whicle mutual funds average 12%/year, let's assume the your retirement account also includes bonds, which have a lower average rate of return, but which are much more stable. We can also assume that the stock market doesn't do great over your 45 years of investing. So let's say that you only make 6%. At retirement you would have saved $220,479. You could receive an additional $13228 per year for a total of $18492/year WITHOUT TOUCHING THE PRINCIPLE which can be pssed to your children when you pass away.
Again, this assumes the minimum social security return, that you never get a raise, and that your investment does poorly. You still make more per year upon retirement than if you get the maximum social security benefits under the current system. And under the current system, if you die the money you have saved is lost.
What about if the stock market has an average rate of return?
If your private account had an average rate of return of 10%, which is the average of the stock market over its livetime but less than the average of most mutual funds, you would retire with $838,600 in your private account. You could receive $83,600 per year just living on interest alone. Beats the current system hands down.
Stupidity abounds...
Negative press concerning privitization from Socialists and Communists seems to obscure the benefits experienced by privitization in US and overseas.
Give us the facts devoid of negative and positive spin... devoid of opinions. The facts have been that privitization has been successful inside and outside of our country while every other system is going bankrupt.
The only explaination is that reporters, socialists, communists WANT people to be poor... because poor people easier to keep stupid and easier to keep under control.
Re: ray's post - Yeah... I've been spending some time learning how to invest my savings on my own, directly in the market without any middle man, and it's true, if you do the research and invest on your own you can make much more than the gov't or even mutual funds would for you - esp. in a sideways market. Phil Town talks a lot about this. His site is http://www.philtown.typepad.com.
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