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How Not to Fix Social Security
Dec. 23rd, 2010 09:04 amEveryone knows the Social Security system is broken due to inconstant birth rates (and probably additional causes).
Possible solutions include:
* increase the tax rate
* reduce payouts
* increase retirement age (my favorite)
* replace the system with one where people fund their own retirement
* scrap the system
And that is why the government is reducing employee contributions by 2% for 2011. (Oh, wait, that's not why; it's another incentive to fix the economy. Short-term.) Ever since returning from Amsterdam I've been feeling like I live in a land of idiots.
One article I read responded to readers worried about their current SS payouts by saying that these payouts are based on the inflation rate, not the amount of money collected, so there's no need to worry. The author responded to readers worried about their future payouts by saying that future payouts are based on your salaries, not what you've paid in, so there's no need to worry about that either. As if the usual laws of physics (or mathematics actually) do not apply.
**
The $400 Making Work Pay incentive is being discontinued, but if $400 is less than 2% of your annual taxable income, you'll probably see an increase in your pay for next year. You might want to consider investing this extra money in your retirement in some way such as by increasing your 401K contribution or pre-paying some of your mortgage.
Possible solutions include:
* increase the tax rate
* reduce payouts
* increase retirement age (my favorite)
* replace the system with one where people fund their own retirement
* scrap the system
And that is why the government is reducing employee contributions by 2% for 2011. (Oh, wait, that's not why; it's another incentive to fix the economy. Short-term.) Ever since returning from Amsterdam I've been feeling like I live in a land of idiots.
One article I read responded to readers worried about their current SS payouts by saying that these payouts are based on the inflation rate, not the amount of money collected, so there's no need to worry. The author responded to readers worried about their future payouts by saying that future payouts are based on your salaries, not what you've paid in, so there's no need to worry about that either. As if the usual laws of physics (or mathematics actually) do not apply.
**
The $400 Making Work Pay incentive is being discontinued, but if $400 is less than 2% of your annual taxable income, you'll probably see an increase in your pay for next year. You might want to consider investing this extra money in your retirement in some way such as by increasing your 401K contribution or pre-paying some of your mortgage.