Tuesday, September 21, 2010

Is Social Security Your Best Investment?

US News & World Report on why you may want to draw down your 401(k) first in order to delay claiming Social Security benefits. I don't know whether this makes Social Security your best overall investment, but the annuity-like nature of payments certainly makes it your best end-of-life investment. By relying on personal savings first, you can delay claiming and end up with a much larger benefit in old age.


WilliamLarsen said...

Is SS-OASI a good investment? It depends on when you were born. If you were born prior to 1938, single it is a good deal. If you were born after 1985, it is a terrible deal.

If you were born in 1956, you can expect to receive 52 cents in benefits for each dollar paid to SS-OASI including interest at the prevailing US Treasury rate during your working and beneficiary years.

Delaying drawing SS-OASI will under current law increase your benefits later on. However, you take a risk of dying and drawing less; young people becoming fed up with a terrible program and vote anyone who will not repeal the Social Security Act leaving you high and dry; or congress cutting your future benefit, raising your retirement age, or taxing you more.

The question is will you be sliced from the program when it is your turn to become a beneficiary? The Tea Party movement has had an impact in a short period of time. Think about 117 million potential voters under age 46 who literally become fed up with SS-OASI? Who could stop them? There are 42-43 million SS-OASI beneficiaries and only 58 Million boomers left. This is far too few to out vote the young determined voters.

As SS-OASI does nothing as it has since A. J. Altmyer testified in 1943, "Do you feel lucky?"

I have read many purported fixes and everyone attempts to mask the problem by looking out just 75 years, privatizing or passing the buck on to someone else and everyone is a con. With each passing day SS-OASI promises $3 Billion in benefits that it cannot pay. Like all ponzi schemes, they eventually fail.

The sacred cow is about to be slaughtered.

en184 said...

Europe is already running out of funds to pay its many leeches, retired and laid off workers, with early retirement schemes at 50 expecting to be paid till 80 or more.

GO TO SCHOOL, GO TO UNIVERSITY, DELAY WORKING TILL 28, THEN GET A JOB WITH THE GOVERNMENT, then get an early retirement package at 50...

The madness has to stop...