Afraid they WON'T lay me off (trouble, best, older, security)
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Goddammit! Social Security and Medicare were forced retirement and medical payments. That's MY MONEY and I'm entitled to get it back.
Just cut me a fookin' check for all I've paid in and you'll never hear from me again.
According to my 2020 SS Statement I have paid in $122,259 in SS taxes and another $30,613 in Medicare taxes. A one-time check for $150k+ would not last long in retirement. Even if I took my SS at age 62, my estimated $1,909 monthly check would pay back all of my paid in taxes in less than seven years.
This is all logical. You should do it. You should also feel fortunate that some of the worst recessions in United States history happened when you were well established in your career.
This is all logical. You should do it. You should also feel fortunate that some of the worst recessions in United States history happened when you were well established in your career.
For the circa 1980 Recession I was just out of college and watched a number of co-workers get axed, and other grads not get hired.
For the circa 2008 Recession I was in my early 50's and again watched a number of co-workers get axed.
and there was the circa 2000 Dot-Com Bust that delayed our kids starting their careers.
Very unsettling and stressful times for everyone in the workforce.
Goddammit! Social Security and Medicare were forced retirement and medical payments. That's MY MONEY and I'm entitled to get it back.
Just cut me a fookin' check for all I've paid in and you'll never hear from me again.
Quote:
Originally Posted by djplourd
According to my 2020 SS Statement I have paid in $122,259 in SS taxes and another $30,613 in Medicare taxes. A one-time check for $150k+ would not last long in retirement. Even if I took my SS at age 62, my estimated $1,909 monthly check would pay back all of my paid in taxes in less than seven years.
Correct. Let's say someone is able to get by with living expenses of $40k per year (not exactly an exorbitant lifestyle).... in three years, you will have used up what you paid in. With perhaps 20-30 years of retirement still to go, during which you will keep getting paid. Find yourself with a need to check into the hospital after age 65, and your Medicare taxes can be used up in one week.
Each of us has been paying into an insurance pool (it's even right in the name of your OASDI payroll deduction... "Old-Age, Survivors, and Disability INSURANCE"). There is a good chance that adams_aj will not only get his/her money back, but MY money as well. And I'm OK with that, because it's not my money any more. I have no more reason to expect a refund than I do from Allstate or State Farm or GEICO, if I have been lucky enough to not have accidents or disasters.
HeelaMonster, some of us are living on far less than $40,000 a year. It depends on location and lifestyle.
OP, you will be fine, and I congratulate you for making the decision to retire and take SS.
I haven't taken SS yet but I left full time employment a few years ago and haven't regretted it one bit.
I live on far, far less than $40,000 a year and haven't starved yet.
I'm glad to hear (not starving!), and you are correct... living expenses will obviously vary greatly from person to person, location to location, lifestyle to lifestyle. $40k was not a target or a benchmark, just an arbitrary number for the sake of example. If djplourd lives on $20k per year, they will have "made back" everything they paid in over 6 years, with many more years of retirement still to go, in all likelihood. During which time they will be drawing from money you and I (along with millions of others) paid in to the insurance pool, which was the point.
[ETA: I am also aware that diplourd can't adjust the amount of SS received to match living expenses, whatever they are. My only point is that we ALL will likely get out more than we paid in... which goes to elnrgby's point about the underlying finances and solvency of the program, a different discussion]
Last edited by HeelaMonster; 03-28-2020 at 09:54 AM..
Correct. Let's say someone is able to get by with living expenses of $40k per year (not exactly an exorbitant lifestyle).... in three years, you will have used up what you paid in. With perhaps 20-30 years of retirement still to go, during which you will keep getting paid. Find yourself with a need to check into the hospital after age 65, and your Medicare taxes can be used up in one week.
Each of us has been paying into an insurance pool (it's even right in the name of your OASDI payroll deduction... "Old-Age, Survivors, and Disability INSURANCE"). There is a good chance that adams_aj will not only get his/her money back, but MY money as well. And I'm OK with that, because it's not my money any more. I have no more reason to expect a refund than I do from Allstate or State Farm or GEICO, if I have been lucky enough to not have accidents or disasters.
Does it function like insurance? - yes and no.
You are correct that the principle of many people paying a premium, and only those who end up needing the benefit collect the benefit, is the principle of insurance.
But the Social Security system functions worse than the worst, lowest rated, dinkiest fly-by-night insurance company you can find anywhere. First, reputable insurance companies first of all require EVERY participant in insurance plan to pay their premium. They do not confound spreading of risk with handing out welfare. Every person insured by an insurance company has to pay a premium X in order to receive a benefit Y. If more people participate in such an insurance, the cost of premium is lower. Second, the law demands extreme fiscal responsibility of insurance companies. These companies are obliged to keep huge liquid reserves, and cannot wantonly raid these reserves to fund something unrelated to the insurance policies. Third, reputable insurance companies are private companies who actually suffer repercussions if they invest badly - therefore, the portion of their assets that is invested for growth is invested extremely responsibly. For these three reasons, old and large insurers are among the wealthiest and most stable in the US and the world - while Social Security is constantly threatened with seriously reduced solvency, and Medicare with total insolvency.
I personally would be in favor of privatization of Social Security/Medicare by turning SS/MC accounts over to a joint supercompany formed by participation of the 10 largest US insurance companies. That would delete people who didn't pay into these programs from the programs (and would shift them to Medicaid), would split spousal benefits 50/50 while both spouses are alive (rather than, completely illogically, increasing the total benefit for people who happen to be married but one spouse hadn't worked), and would result in incomparably more secure management of the accounts. I believe that is what politicians like Paul Ryan want when they talk about privatization of SS/MD, not discontinuation of these programs.
It is not quite true that $130k paid to SS over 35 years would result in enough $ for only 3 years of survival if there weren't for the Social Security. If even half of that amount had been paid to an insurance company between 1985 and 1990 as a premium, it could have bought a delayed annuity starting to pay in 2020 much more than what Social Security would pay in 2020 for $130k in lifetime contributions.
You are correct that the principle of many people paying a premium, and only those who end up needing the benefit collect the benefit, is the principle of insurance.
But the Social Security system functions worse than the worst, lowest rated, dinkiest fly-by-night insurance company you can find anywhere. First, reputable insurance companies first of all require EVERY participant in insurance plan to pay their premium. They do not confound spreading of risk with handing out welfare. Every person insured by an insurance company has to pay a premium X in order to receive a benefit Y. If more people participate in such an insurance, the cost of premium is lower. Second, the law demands extreme fiscal responsibility of insurance companies. These companies are obliged to keep huge liquid reserves, and cannot wantonly raid these reserves to fund something unrelated to the insurance policies. Third, reputable insurance companies are private companies who actually suffer repercussions if they invest badly - therefore, the portion of their assets that is invested for growth is invested extremely responsibly. For these three reasons, old and large insurers are among the wealthiest and most stable in the US and the world - while Social Security is constantly threatened with seriously reduced solvency, and Medicare with total insolvency.
I personally would be in favor of privatization of Social Security/Medicare by turning SS/MC accounts over to a joint supercompany formed by participation of the 10 largest US insurance companies. That would delete people who didn't pay into these programs from the programs (and would shift them to Medicaid), would split spousal benefits 50/50 while both spouses are alive (rather than, completely illogically, increasing the total benefit for people who happen to be married but one spouse hadn't worked), and would result in incomparably more secure management of the accounts. I believe that is what politicians like Paul Ryan want when they talk about privatization of SS/MD, not discontinuation of these programs.
It is not quite true that $130k paid to SS over 50 years would result in enough $ for only 3 years of survival if there weren't for the Social Security. If even half of that amount had been paid to an insurance company between 1985 and 1990 as a premium, it could have bought a delayed annuity starting to pay in 2020 much more than what Social Security would pay in 2020 for $130k in lifetime contributions.
No arguments from me, Eleanor. I was only discussing the underlying concept (insurance versus "bank where I deposited my money, and now I want it back").... but would never argue it is a well-run, cost-effective, fiscally-responsible insurance program!
For the circa 1980 Recession I was just out of college and watched a number of co-workers get axed, and other grads not get hired.
For the circa 2008 Recession I was in my early 50's and again watched a number of co-workers get axed.
and there was the circa 2000 Dot-Com Bust that delayed our kids starting their careers.
Very unsettling and stressful times for everyone in the workforce.
The late 1970s-early 1980s recession and the early 2000s recession were a walk in the park compared to the late 2000s-early 2010s recession. I finished my MBA program just mere months before Lehman collapsed. Even before Lehman collapsed, there were bad signs in the economy, especially as it pertains to new MBA hiring. Big companies plan out their new MBA hires about a year in advance. In Spring 2008, many large companies were setting up hiring freezes. As far back as Oct-Nov 2007, my MBA classmates and I were seeing our interview pipelines dry up and/or get cancelled.
As an older Millennial in my mid-30s, I have been decimated by the 2 worst recessions of the last 80 years (2008 and 2020 COVID). My early career has been obliterated. It took me until the late 2010s to recover from the last recession. There is a chance that I will be picking up the pieces from the financial devastation of 2020 until I am 45 years old. This will certainly factor into my ability to retire at some point in the future.
I strongly believe that new grad hiring was better in the circa 1980 recession than what happened to me.
In the circa 2008 recession, the Baby Boomers who were in their 50s then experienced what I would consider as less financial pain than the Millennials who were then in their 20s. There were fewer 50-something Boomers who lost their jobs and got forced into early retirement than Millennials who weren't getting hired and had to retreat to Mom and/or Dad's basement. I'm not making light of the pain Boomers experienced with their 401k's or housing values during that time, but the devastation that happened to the careers of Millennials was far worse in the long run.
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