I would so LOVE to see any Pubbie candidate bring up the subject of TSP accounts, because it would put any incumbent Dim in an very awkward position to have to tell how much they--or their fellow Congress critters--have earned through investments in this PRIVATE investment plan.
How Three Texas Counties Created Personal Social Security Accounts and Prospered Across the country, state and local governments are facing huge unfunded liabilities for their employee pension plans. And then theres Social Security.
But three neighboring Texas counties, which opted out of Social Security 30 years ago by creating personal retirement accounts, have avoided a fiscal train wreck while providing retirees with even more retirement income.
Galveston, Matagorda and Brazoria County employees, many of them union members, have seen their retirement savings grow every year, even during the Great Recession. If state and local governmentsand Congressare really looking for a path to long-term sustainable entitlement reform, they might start with what is referred to as the Alternate Plan.
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More importantly, if a worker participating in Social Security dies before retirement, he loses his contribution (though part of that money might go to surviving children, if any, or a spouse who didnt work and therefore didnt establish his or her own benefits). But a worker in the Alternate Plan owns his account, so the entire account belongs to the estate. There is also, among other benefits, a disability benefit that pays immediately upon injury, rather than waiting six months, plus other restrictions, as under Social Security.
And those who retire under the Galveston model do much better than Social Security. For example:
A lower-middle income worker making about $26,000 at retirement would get about $1,007 a month under Social Security, but $1,826 under the Alternate Plan, according to First Financials calculations.
A middle-income worker making $51,200 would get about $1,540 monthly from Social Security, but $3,600 from the banking model.
And a high-income worker who maxed out on his Social Security contribution every year would receive about $2,500 a month from Social Security vs. $5,000 to $6,000 a month from the Alternate Plan
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