Posted on 07/25/2017 7:05:59 PM PDT by SeekAndFind
It is no secret that what the major media seem to care most about is radically different from what concerns average Americans. While the inside the Beltway crowd continues to focus on alleged collusion between President Trump and Russia, real concerns like the future of Social Security are ignored.
The Social Security Board of Trustees, a six-member panel who serve the federal government by offering a short-term and long-range forecast on the health of the Social Security program, has issued a new report, which says that while the retirement program will be "cash flow positive" through 2021, it is still in line to run out of money unless taxes are raised, or benefits are substantially reduced.
Financial Planner Ric Edelman has come up with an idea that is so simple and workable it could transform the aging program and make retirement more comfortable and secure for years to come. Full disclosure: Edelman, who has been ranked three times the number one independent adviser by Barron's, is my financial adviser.
Edelman says reforming Social Security is essential because, according to the Pew Charitable Trusts, roughly 58 percent of workers have access to a retirement plan, while 49 percent participate in one.
Edelman notes that people who do have such plans don't have much money in them, just an average balance of $159,000, according to the Employee Benefit Research Institute. That amount can only generate a few hundred dollars a month in retirement income, which is why even when Social Security is added to this pittance it can't adequately provide for the needs of most retirees.
Edelman's solution? The federal government would set aside $7,000 one time for each child born during the next 35 years. The money would be placed in an investment account managed by a blue-ribbon panel of investment experts appointed by the president and Congress.
After 35 years, the government gets back its $7,000 -- increased for inflation -- and uses the money to pay for children born during the next 35-year cycle, making it self-funding.
When the child reaches age 70, monthly benefits are provided -- equal in income to what Social Security provides, allowing the current program to be replaced with no adverse effect on retirees.
I asked Edelman about the politics of this, since Social Security is considered a political third rail, untouchable, highly charged. "That's why I don't propose altering how the Social Security trust fund is managed," he said, "which is what killed privatization efforts years ago."
Under his proposal (he calls it the Trust Fund for America), the money would be invested in a diversified portfolio put together by a panel of investment experts consistent with how the nation's pensions funds and endowments are managed.
To keep the money from being "raided" by Congress, Edelman says each baby would be assigned an individual account, much like an IRA, and would receive annual statements showing the account balance.
Edelman says he is joining the Bipartisan Policy Center, a Washington, D.C.-based think tank that addresses the challenges facing the nation, to focus on fixing the problems with Social Security and ensure a stable retirement program for every American.
Anticipating criticism from the usual suspects who want to use Social Security as a political weapon instead of fixing it, Edelman says, "If anyone complains about my proposal, they need to complain about the nation's pension plans, too, because I am doing nothing different from them."
Wouldn't you like to see dysfunctional Washington and the anti-Trump news media actually get behind something that benefits the most people? If surveyed, I'd bet an overwhelming number of respondents who are fed-up with issues that do not impact their lives, would scream "yes!"
How Three Texas Counties Created Personal Social Security Accounts and Prospered
https://www.forbes.com/sites/merrillmatthews/2011/05/12/how-three-texas-counties-created-personal-social-security-accounts-and-prospered/#17f7dc613283
How Privatized Social Security Works in Galveston
http://www.nytimes.com/2011/09/18/us/how-privatized-social-security-works-in-galveston.html
The only way to save Social Security is to take it OUT of the hands / control of politicians.
Or congress could just undo all the changes they have made that hand out Social Security money to people other than those who worked and contributed to the fund.
It started out as a contributory retirement fund but over the years congress has raided it and treated it as a wefare slush fund to finance their “feel good” changes.
“The money would be placed in an investment account managed by a blue-ribbon panel of investment experts appointed by the president and Congress.”
Um, no. Can’t you just envision the members of this blue-ribbon panel appointed by DC politicians? Talk about putting the fox in charge of the hen house.
am i seeing this right ?
2015 there were 3,978,497 births times 35 times 7,000 = 974 trillion, before the first 7,000 per gets paid back ?
where does the 974 trillion come from ?
On the plus side I can file taxes in her name instead of against my income.
I don't think that works.
The problem is that money was involuntarily collected from me and millions of others with a promise that we would get benefits when we retired. Other people, already retired at the time, got my money.
Now that I am retired, I will fight you tooth and nail, to the bitter end, to get the government to keep up its end of the promise.
Stylin the buzz kill.
you had to go and get all logical on us, didn't you.
No, the $7,000 is a one-time contribution, not $7,000 per year. Makes it more manageable, but I agree with the posters who say that it's a recipe for disaster; graft and corruption abound.
I think the most likely way that it will be done is to get rid of the income cap on the social security tax and put a cap on the maximum allowable benefit under social security. I’m not saying it’s the best way, just the most likely to be politically possible.
In 2010 3,999,386 children were born in the US. So under this plan approximately 29 billion additional dollars would be put into the stock market every year. I’m not a financial guru but maybe some freeper here is and can comment on what kind of effect this would have on the stock market?
No, it was always mandatory and from the being the law stated that any surpluses from the social security tax had to be loaned to the federal government. If you don’t believe me you can find the social security act of 1935 posted online at various sites.
Actually it’s a tax and so it is constitutional under the 16th Amendment.
1. Raising the retirement age to 70. He sneaked that in.
2. Northing will keep Congress from tapping into that kind of money.
Eliminate a few federal departments.
You’re buying the supreme court lie is all. Constitutional government in the United States is based on enumerated powers. There are 30 enumerated powers in Article 1 Section 8. Transferring wealth from producers to voters is not one of them.
No. I’m following the constitution which can be changed by the Amendment process. The way our system is set up you could pass a constitutional amendment stating sharia is the supreme law of the land and sharia law would then be constitutional.
It would also be against the intentions of the founding fathers and I would fight with my life against such an amendment, but that is the way our constitution works.
i screwed up the math...it’s 976 billion.
so this could actually work...
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