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Educate me on Social Security.

Discussion in 'The Lounge' started by sled_dog, Feb 5, 2005.

  1. sled_dog

    sled_dog 1 ton status

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    I'm sorry to say I am youngin with very limited knowledge of the system. Don't reply with stupid biased comments about how horrible it is, at least not yet :p: . What does it take to be eligible for SS? Just being born and having an SS number? I wonder about things like this, cause I know people who have never held a job for more than a few weeks at a time their whole lives, leeched off others and I doubt ever paid a cent into SS and these are the people I picture living off it in a few years. All I have to say, I'm setting up a retirement plan asap.
     
  2. 75-K5

    75-K5 3/4 ton status

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    If you never had a payroll job in your life you won't get SS. That's why widows only get their husbands' SS check if they were homemakers. Also, if said widow dies, her family doesn't get a death benefit.
     
  3. eagle mark

    eagle mark 1/2 ton status

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    You put money into Social Security all your life whenever you get a paycheck. The more you make the more you deposit and the more you make at the end. There is a little more to it but it is lake any other retirement program. With some added benefits should you become disabled before time.

    There are some medical benefits and now some prescriptions. With both you would need a supplement plan to get any decent health coverage whatsoever. Unless you have no asset's other than a home. Then you can qualify for medicaid. With medicaid from the state you have to be close to penniless. This will get you any emergency care to stay alive and follow up. But most doctors won't even look at you as a new patient. Basically it's a slow death compared to having a health insurance plan.

    Social Security is a great first step but don't plan on just it.

    My wife and I have been going through this with her parents for several years. They never really had much, he was injured in a mining accident in his 30's. We've been helping them for 18 years...
     
  4. Bubba Ray Boudreaux

    Bubba Ray Boudreaux 1 ton status

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    Let me go ahead and start.................

    Social Security is some worthless, government mandated bullcrap that makes about as much sense as a football bat.

    :D
     
  5. 4by4bygod

    4by4bygod 1/2 ton status

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    By all means, set up a plan for yourself. Don't count on SS being there. On your paychecks, you see where it says FICA? That's what the gov't is taking from you for SS, and the gov't then is supposed to match the same amount, and there's your SS. Of course, they put ALL of that money in the general fund for whatever, and when you hit 65, you begin getting a pittance of what you paid in.

    What's cool is that when you're self employed like me, you get to pay BOTH halves. ( the FICA part, and the gov't match part) because the gov't considers you to be two people, the employer and employee. logical, no?

    I'm considering opting out of the system entirely and setting up a SEP, or self funded retirement program. you can opt out any time you want, and you'll still collect what you're due, but no more than what you were due when you opted out.

    I say, bring on the privatization. Not just a little percentage, but the whole damn thing. the quicker we wean folks off the gov't teat, the better off we'll be in the long run.

    Tom
     
  6. eagle mark

    eagle mark 1/2 ton status

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    You make as much sense as Kerry! :D
     
  7. eagle mark

    eagle mark 1/2 ton status

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    Yes for a young entrepanure such as yourself and many others. Some people look forward no more than tomorrow.


    Then we as a society are stuck with a huge population that have nothing and have contributed nothing.
     
  8. sled_dog

    sled_dog 1 ton status

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    how would we be stuck with nothing? We'd have what we saved from not paying SS wouldn't we? If you don't set up your own retirement fund then you are the fool and its your problem. What is that story, Grasshopper and the Ant or something like that? It may not be the nicest thing in the world, sure people would have ****ty old lives but whos fault would it be? No one but their own.

    and 4by4god I'm taking Accounting at Wyotech right now so I learned all those little facts this week. FICA, FUTA, SUTA, Income tax, fun fun fun.
     
  9. HarryH3

    HarryH3 1 ton status Author

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    6.2% of your gross pay goes to Social Security, up until around $90K per year of income, at which point your payments stop for that year. Many people don't realize that your employer also kicks in 6.2%, so 12.4% of your gross pay gets put into the Social Security system on your behalf. :cool1:

    One VERY common misperception is that Social Security will provide all that you need after retirement. But it is intended only as a supplement to retirement. Think of it at one leg of a 3-legged stool. The 2 legs are 1) a pension plan (or 401(k) or profit sharing plan), 2) personal savings, and 3) Social Security. But most Americans never "get around" to starting a personal savings plan. Many others work in jobs that don't provide any type of pension. So they end up trying to live on the $800-1,300 a month check that they get from the gov't. Then they piss and moan that the gov't isn't taking care of them, when in reality, they didn't take care of themselves. It's sad how very little most Americans understand about money. :(

    If you were born in 1929 or later, you need to have worked for at least 10 years to be eligible for retirement benefits. If you're eligible for retirement benefits, some members of your family also can receive benefits.

    If you were born before 1938, your "full retirement age" is 65. Because of longer life expectancies, the full retirement age is increasing (on a sliding scale) for people born after 1938. You can start your Social Security benefits as early as age 62, but the amount you receive each month will be less than if you start at full retirement age.

    The only way that I know of to "opt out" of the Social Security system is to be employed by the federal government. There are special rules for government workers since Congress didn't think it was fair for them to get both a government pension check AND a SS check (even though workers in private employment get that deal). I guess that since the private employer plans aren't paid by the government, then that's OK. :(

    A SEP works sort of like an IRA or 401(k), but it has special advantages for business owners and small businesses with fewer than 100 employees. However, it works as a supplemental source of retirement income and doesn't replace SS.

    Social Security doesn't provide ANY medical or health benefits. Those are actually covered (very minimally) by Medicare and Medicaid. Most people NEED a Medicare supplement policy to cover the many things that Medicare doesn't. To get much help from Medicaid you pretty much have to be a couple of weeks living under a bridge.

    You can read more than you ever wanted to know about Social Security at www.socialsecurity.gov

    You guys that are in your 20's and 30's have a HUGE advantage in the retirement race. The biggest factor in earning lots of money from investments is TIME. The earlier in life you get started, the more that compounding works in your favor. For example, if you're 20, just $100 per month, invested at the long term market average return of 11% per year, will grow to $1,183,966 when you're ready to retire. (You can make that number really HUGE by increasing your contributions as your income rises throughout your life). :cool1:
     
  10. sled_dog

    sled_dog 1 ton status

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    like I said, whenever I get a real job I'm starting my retirement plan. Need to talk to mom and my bank about it when the time comes. Mom does benefits and such for her business.
     
  11. Fubeca

    Fubeca 1/2 ton status

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    Very good advice!! Start saving Now. In 45 years that $1,183,966 will only buy you what $307,450 would buy you today. Most people will need a lot more than that to live the lifestyle they want once they retire.

    The government doesn't match your FICA contribution -- your employer does. If you are self employed you pay both halves, kind of a pain but its only fair to pay in the same amount as is paid for an employee.
     
  12. sled_dog

    sled_dog 1 ton status

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    mom's company has one of those programs that however much you put into your retirement they put it a matching amount to a point. Be nice to work for a place that did that.
     
  13. Fubeca

    Fubeca 1/2 ton status

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    Yup, FREE money -- can't beat that :D
     
  14. 82diesel

    82diesel 1/2 ton status

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    They would not be allowed to withdraw the money from the SSA private funds. Only pick a fund and 30% of your SSA money will go to there and the rest to the general fund.
     
  15. Bubba Ray Boudreaux

    Bubba Ray Boudreaux 1 ton status

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    And my reply is brought to you by the letters F and U................
     
  16. spincast375

    spincast375 1/2 ton status

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    It's a Ponzi scheme . . . .

    run by the federal government. If you and I ran a Ponzi scheme, we'd be in jail for fraud. But the government does it so it is ok. My father, now deceased, lived through the Depression, and thought FDR (the creator of SS) was a saint. To those getting in early, a Ponzi scheme is great. The latter ones get nothing back; just as you and I will.

    I once asked an elected representative if I could deduct SS from my federal income tax, like a state income or sales tax. I offered to sign a waiver saying I and my heirs would never make a claim against it. He thought I was nuts (probably a product of government schools, as he couldn't do simple math).

    When I was a kid, we took care of our elderly. Now we dump them into nursing homes because SS will pay for it. I think FDR had a good heart, but his actions led people to start believing that the Government will take of them. And I have a 'right' to government benefits. But the government creates nothing: it takes from some and gives to others. It has created class warfare that will just get worse as the bay boomers retire. SS will fail.

    Ask Kennedy and Pelosi this: why has Congress written themselves out of SS and in to a plan where they retire rich? Why can't we have the same plan they have? Ask your own rep or senator. If they are so insistent on keeping the program the way it is, if it is so good for America, why are they not in it?
     
  17. 4by4bygod

    4by4bygod 1/2 ton status

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    You are correct about the employer match thing. I hate it when I post without the aid of caffiene.

    Tom
     
  18. 4by4bygod

    4by4bygod 1/2 ton status

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    <<It's a Ponzi scheme >>

    Amen!
     

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