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Not much I agree with Yellen on, but I do on this

I've long felt SS's upcoming shortfalls need to be tackled and ASAP. I've also been of the opinion SS should be tackled from various directions in in various ways (and did I say ASAP). It doesn't need to collapse and the burden of shoring it up doesn't need to happen in only one way. Smaller modifications, from multiple directions, would go a long way if implemented ASAP.
I think bipartisan support might be able to be found on this topic.


The only bipartisan support I could see happening would be raising the payroll tax and kicking the can some more. Democrats will not allow cuts, and Republicans will not allow progressive taxation.

The best thing that could be done, for me, is opt me out. No tax, no benefit. I can take care of myself. As there are millions of people who also can take care of themselves, the whole program should be phased out at the federal level and let people and states come up with better solutions. Probably a combination of welfare for those who make bad choices, and either opt out or public savings accounts for responsible people.

The purpose of govt is to defend life and liberty, not income support.
 
And yet - Biden just gave SS recipients an 8% cost of living increase. ;)

The SS trust fund would be just fine if congress didn't see it as a slush fund to be dipped into whenever they needed more monies to spend on the pet political projects. Any more, congress actually considers it a source of revenue for anything not SS.

Its not that they can dip into it. The law requires surplus money to be invested in T-Bills. Im not sure the economy could handle trillions in surplus going into an actual 'lockbox' and sitting idle or being invested in volatile assets. What they could do is constantly tweak the tax rate to keep the surplus minimal.
 
That’s a small price to pay for decades of deficit spending. The Boomers played themselves

The ‘Boomers’, for the most part, get to spend “free” money, since we enjoy a very good return on our (very modest) SS investment. I (at age 68) have been collecting (income tax free) SS retirement benefits for 6 years and have already gotten more than I ever ‘contributed’ during my 42+ years of paying FICA ‘payroll’ taxes.
 
Sorry 'bout the delay here, was a busy Holiday weekend followed by a Manic Monday!

Hope you had a good Christmas.

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I'm not sure how you came to the bolded conclusion? The current $162K/yr per individual exempt level would seem to be well past the income level for "the poor", would it not? The exemption level is $320K per couple. It's also nearly 3X the average American income. The poverty line is 27K for a family of 4, and middle-class is often defined as 2/3 - 2X the median income, or $42K-130K.

So, I'm at a loss with your claim as to how raising the exemption past 162K further "taxes the middle-class".
There is a cap on how large a SS benefit can be. So, let's say the SS cap for a person who delays SS until 70 would be $3800 or so a month. The income that person was taxed on for SS purposes was up to the first $162K.
Let's say a person has a high income. High income people are already taxed at higher rates in general. But the SS tax is "linked" to the eventual benefit they'll receive. So, if the income level is raised but the max benefit isn't raised, linkage changes to a punishment of the richer people for a program where that linkage has historically been maintained and I'd argue should be maintained.
 
There is a cap on how large a SS benefit can be. So, let's say the SS cap for a person who delays SS until 70 would be $3800 or so a month. The income that person was taxed on for SS purposes was up to the first $162K.
Let's say a person has a high income. High income people are already taxed at higher rates in general. But the SS tax is "linked" to the eventual benefit they'll receive. So, if the income level is raised but the max benefit isn't raised, linkage changes to a punishment of the richer people for a program where that linkage has historically been maintained and I'd argue should be maintained.

That's half the picture. The other half is the already negative treatment wealthier people get on their SS benefits as well. Their benefits are going to be taxed and they are also far more likely to be reduced because of ongoing earnings. The OASDI system is incredibly progressive when you account for these things. People who pay in very little get a disproportionately greater benefit, those who pay in more less so. The idea that we should be even remotely considering making this worse is fundamentally wrong. We already have the most progressive tax code in the world and now this is effectively trying to make the benefit programs even more progressive as well? Yea, pass.

The real issue is that SS was never intended to be a retirement program, nor a pay-go program, but now it is both. It has zero chance of remaining fiscally sound because of the fertility rates, period, full stop. That means the entire model has to be revamped frankly. We should begin phasing in reductions in benefits tomorrow rather than a cliff that hits in a decade.
 
The ‘Boomers’, for the most part, get to spend “free” money, since we enjoy a very good return on our (very modest) SS investment. I (at age 68) have been collecting (income tax free) SS retirement benefits for 6 years and have already gotten more than I ever ‘contributed’ during my 42+ years of paying FICA ‘payroll’ taxes.

I would be interesting in seeing that math, it is almost impossible for those figures to work out that way.
 
I would be interesting in seeing that math, it is almost impossible for those figures to work out that way.

How so? I (currently) get $1,980/month ($23,760/year) net (after Medicare premiums are deducted) in Social Security (SS) income. IIRC, I paid about $75K in cumulative (lifetime) FICA payroll tax ‘contributions’ before ‘retiring’ at age 62.

Assuming a 100% employer match that’s $150K or enough to cover about 6.3 years of my net SS benefits. However, since that also paid for 100% of my Medicare ($148/month or $1776/year) premiums (starting at age 65), I have already gotten more back than I (and my employers) had ever paid in.
 
That's half the picture. The other half is the already negative treatment wealthier people get on their SS benefits as well. Their benefits are going to be taxed and they are also far more likely to be reduced because of ongoing earnings. The OASDI system is incredibly progressive when you account for these things. People who pay in very little get a disproportionately greater benefit, those who pay in more less so. The idea that we should be even remotely considering making this worse is fundamentally wrong. We already have the most progressive tax code in the world and now this is effectively trying to make the benefit programs even more progressive as well? Yea, pass.

The real issue is that SS was never intended to be a retirement program, nor a pay-go program, but now it is both. It has zero chance of remaining fiscally sound because of the fertility rates, period, full stop. That means the entire model has to be revamped frankly. We should begin phasing in reductions in benefits tomorrow rather than a cliff that hits in a decade.
Why do you constantly make the disproven claim we have the most progressive tax system in the world, after you've been shown we do not?
 
How so? I (currently) get $1,980/month ($23,760/year) net (after Medicare premiums are deducted) in Social Security (SS) income. IIRC, I paid about $75K in cumulative (lifetime) FICA payroll tax ‘contributions’ before ‘retiring’ at age 62.

Assuming a 100% employer match that’s $150K or enough to cover about 6.3 years of my net SS benefits. However, since that also paid for 100% of my Medicare ($148/month or $1776/year) premiums (starting at age 65), I have already gotten more back than I (and my employers) had ever paid in.

Your 75k contribution number is well below national median wage for a 40 year career. Or did you not work your whole adult life or something? In either case, the way to look at it would be the total return expectation from that investment, in other words you are ignoring your compounding interest and returns. I agree though, if you really only did have $150k in contributions, then it is a crazy good deal for you and a great example of why the system is unsustainable, especially with your numbers being for an early retirement as well.
 
Your 75k contribution number is well below national median wage for a 40 year career. Or did you not work your whole adult life or something?

When I started working, it was at MW (or barely above) pay. For 3 years I earned enough to hit the SS ’contributions’ cap, but most of my working years I was earning at (or below) the median income level.

BTW, only my top 35 years of ‘contributions’ were used to establish my SS benefit level. Inflation (over time) also played a big part in this, as did the lower percentage of the FICA payroll tax rates when I started working.

In either case, the way to look at it would be the total return expectation from that investment, in other words you are ignoring your compounding interest and returns. I agree though, if you really only did have $150k in contributions, then it is a crazy good deal for you and a great example of why the system is unsustainable, especially with your numbers being for an early retirement as well.

There is very little compounding interest and returns in a (largely) ‘pay as you go’ system.

The system is (has become?) “unsustainable” largely because the number of current workers per current retiree has decreased while the the number of years retirees (and their surviving spouses) collect benefits has increased over time.
 
When I started working, it was at MW (or barely above) pay. For 3 years I earned enough to hit the SS ’contributions’ cap, but most of my working years I was earning at (or below) the median income level.

BTW, only my top 35 years of ‘contributions’ were used to establish my SS benefit level. Inflation (over time) also played a big part in this, as did the lower percentage of the FICA payroll tax rates when I started working.

Ah, that will do it I suppose. Sorta proves the point about how progressive the underlying system is. Compare that to myself and my wife. We will have paid in nearly a million dollars in FICA taxes and get a benefit that is roughly 2x yours. So, 6x the payments for 2x the return.


There is very little compounding interest and returns in a (largely) ‘pay as you go’ system.

No, there is, it is just tied to treasury rates. There is still a compounding there.

The system is (has become?) “unsustainable” largely because the number of current workers per current retiree has decreased while the the number of years retirees (and their surviving spouses) collect benefits has increased over time.

Yea, in a nutshell. It was a ponzi scheme from the beginning dependent upon a pyramid shape of labor. You can't go from 15:1 workers/retirees to 2.3:1 and expect the same racket to work out. If an insurance company ran a scheme like this everyone goes to prison, politicians do it and they get re-elected.
 
Ah, that will do it I suppose. Sorta proves the point about how progressive the underlying system is. Compare that to myself and my wife. We will have paid in nearly a million dollars in FICA taxes and get a benefit that is roughly 2x yours. So, 6x the payments for 2x the return.
The $160k cap for 2023 equates to $9932.4 in payee contribution... or in this case less than $20k per year per household. Your math doesn't make sense. A person earning $1 million + per year would pay the same thing.
 
The $160k cap for 2023 equates to $9932.4 in payee contribution... or in this case less than $20k per year per household. Your math doesn't make sense. A person earning $1 million + per year would pay the same thing.

Yep, the claim of having paid nearly $1M in SS ‘contributions’ seemed like BS (nearly 14K/year each assuming 35 years of contributions) to me, but I decided to let that questionable (at best) assertion slide.
 
The $160k cap for 2023 equates to $9932.4 in payee contribution... or in this case less than $20k per year per household. Your math doesn't make sense. A person earning $1 million + per year would pay the same thing.

Two people, maxing out contributions their entire working careers. Try your math again. We are not W2's, so we eat both sides, and even if not the employer contribution should always be included. So for 2022 I am going to be in to SS for ~40k and Medicare for more than that.
 
Two people, maxing out contributions their entire working careers. Try your math again. We are not W2's, so we eat both sides, and even if not the employer contribution should always be included. So for 2022 I am going to be in to SS for ~40k and Medicare for more than that.
It's your lie... tell it however you want.
 
Ah, math too much for you again? Or did you run out of fingers to count on?
Someone is butthurt because their tale didn't receive the traction they were hoping for.
 
Someone is butthurt because their tale didn't receive the traction they were hoping for.

How about you explain where my math is wrong then. Or you can just deflect all day long rather than admit you can't math.
 
How about you explain where my math is wrong then. Or you can just deflect all day long rather than admit you can't math.
It's already done. Max contribution is $9932.4 per person for 2023, even if they earn $160k or $1.6 million.
 
It's already done. Max contribution is $9932.4 per person for 2023, even if they earn $160k or $1.6 million.

Ah, so you are unaware that that is only for one side of the FICA tax? Or are you simply ignoring the employer side? Or in this case the self employed side? Or are you ignoring the fact that my wife (as I specifically mentioned) was also included in this calculation as a member of my tax filing household?

Which lie or incompetency would you like to admit to here?
 
Ah, so you are unaware that that is only for one side of the FICA tax?
Your attempt to double back won't work. Like i said... it's your lie, tell it however you want with as many additional qualifiers necessary.
 
Two people, maxing out contributions their entire working careers. Try your math again. We are not W2's, so we eat both sides, and even if not the employer contribution should always be included. So for 2022 I am going to be in to SS for ~40k and Medicare for more than that.

OK, but you were using 2 (self-employed?) people making the capped amount (every year) to become 6X (rather than 3X each) what my single person (mostly uncapped) ‘contribution’ amount was.

It’s true that the SS retirement benefit formula gives those with lower (highest 35 year ‘lifetime’) ‘contributions’ a better return on their ‘investment’, but it’s not as skewed as you tried to make it out to be.
 
Your attempt to double back won't work. Like i said... it's your lie, tell it however you want with as many additional qualifiers necessary.

Got it, so you are going with general incompetency, your standard defense.

At least you are consistently inept.

What you call qualifiers btw, are all part of the tax code.

OK, but you were using 2 (self-employed?) people making the capped amount (every year) to become 6X (rather than 3X each) what my single person (mostly uncapped) ‘contribution’ amount was.

Yes, but keep in mind we are contributing ~3x the median individual payer, as you stated you were below that much of your working career. We were maxing out from nearly day 1 of our taxpaying lives.

It’s true that the SS retirement benefit formula gives those with lower (highest 35 year ‘lifetime’) ‘contributions’ a better return on their ‘investment’, but it’s not as skewed as you tried to make it out to be.

You have yet to consider taxation of benefits and reduction of benefits. Something that doesn't apply to you, but will to me, and is signifcant in the total return calculation. I would love to be able to walk away from medicare/ss taxes. Hell, give me 50% of what I paid in and exempt me from future taxes and I will never talk to them again, but that ain't in the cards, they need to keep stealing my golden eggs.
 
You made the choice to "offer" your shitty compensation strategy and now will try to change the calculation along the way on the basis of partisanship. Nobody gives a **** about your story other than you.
 
You made the choice to "offer" your shitty compensation strategy and now will try to change the calculation along the way on the basis of partisanship. Nobody gives a **** about your story other than you.

What calculation was changed, at any point? I specifically stated it was at the household level with my wife. Or are you suggesting that self employed FICA taxes somehow don't count as taxes paid?

You should have just stuck with your incompetency defense.
 
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