Social Security is a Ponzi scheme that will ultimately fail. It is a terrible experiment that, the longer it goes on, the worse the financial catastrophe will ultimately be. We should be able to keep our money and invest it where it will do some good. Social Security is not secure and it destroys the social fabric of our society.
I see approximately $300 per month of my paycheck go some god-forsaken entity called FICA, and if I think too long about that acronym, it begins to look like a vulgarity. Not only does this FICA soak me for $300, but he gets the same amount out of my employer, only to deceive me into thinking he's taking only half as much as he really is. This means that under normal circumstances I would be making about $600 more per month on my paycheck.
If I were to invest this $600 per month for the 16 years that I have worked at this job at a conservative rate of 4% interest, I would have approximately $161,003. If, from now until I retire in the year 2030, I just let that money sit and continue to gain 4% interest, it will be worth $412,692. But if I continue to invest $600 per month during that time, I will have saved $709,177.
The 2006 average monthly benefit for a retired couple is $1,648. Let's say that by the time I retire, the amount my wife and I get from Mr. FICA is $3000 per month. If I live to be 100, we will have received $990,000.
Looks like we'll be getting a great deal! But wait... If I were to take the same $3000 per month from my personal account as it continued to earn the same 4%, it would take me til I was 106 years old to deplete my savings. More importantly, I could hold down another job if I wanted to and still collected my annuity from my personal savings account, which I cannot do if I want to collect $3000 from Social Security.
Social Security does not earn interest, at least not for me. Besides that, it is a pipe dream to imagine that my wife and I will really receive $3000 per month from Mr. FICA when we retire. And what happens to my Social Security when I die? It's gone. But the savings in my personal account belong to my spouse and children.
I want my money back. No actually, let's do this. Stop making me pay Social Security taxes (and my employer on behalf of me) and let me invest that amount in a private account. I will make way more than 4% doing that, by the way. And you know what? I would be glad to renounce all prior payments to Mr. FICA if I could make this change right now.
The problem is--the money I spend into Mr. FICA's account was never meant to socially secure me. It's meant to socially secure my parents and my grandparents. So who's going to secure me when I get that old? And then whose going to secure them? You start to get the picture. It's a corrupt Ponzi Scheme. The Social Security Trust fund is bankrupt now, but Mr. FICA doesn't tell you about that. Imagine the financial fallout that will obtain in the near future when it is determined that there are no more government money buckets to rob to pay for Social Security entitlement obligations.
Social Security takes away the responsibility of family members to take care of themselves and thus breaks down the family unit. In the past when grandparents had trouble, their children were more likely to take them in and help them pass the last few years of their lives. But with the advent of Social Security, they unfortunately let everyone else take care of them in most cases. Nowadays families don't stick together as much as they once did, and a major cause is the advent of Social Security.
It is far past time to phase out Social Security and let us take care of ourselves with our own money. Everyone will be better off.