Not sure I read your comment correctly. By Social Security funds do you mean 401k like Social security private accounts or the Regean era trust fund? Assuming you meant the former:
- Social Security Wealth is currently an approximately 11 trillion dollar liability for the United States government. - As it stands the pay-as-you-go system will fail to be sustainable by 2017 when the number of those drawing social security will outstrip those contributing. The trust-fund set up during the Regan administration will be empty by 2041, and future retirees will receive as little as seventy five percent of their defined benefits. - Social Security reform is thus a matter of necessity. - Private retirement accounts (PRAs) are actually economically sound PROVIDED they are implemented correctly. - Pay as you go as it now works: http://gothamgazette.com/graphics/ss_chart.jpg This was great when the ratio of workers was 2:1 not so great when it's headed towards 1:2. - PRAs are immediately channeled to beneficiaries so you're funding yourself. Not counting on a dwindling ratio to maybe one day sort of fund you in the future. - Social Security Taxes come with an estimated 2.6% annual return rate, in contrast to the estimated 9.3% return in nonfinancial corporate capital and leading to a loss of real income of 6.7%.
There's more but the details get boring and you can more or less goggle it.
Which isn't to say that you don't have a point and there's nothing *wrong* with PRAs (because you do and there are) - but like... there's sound economics behind the social and financial benefits of PRAs. And yes, stocks are inherently risky but, technically, so are banks and bonds. This is why you diversify your investments.
Apparently, I'm a bit of a capitalist - I swear I'll shut up soon.
- Social Security Wealth is currently an approximately 11 trillion dollar liability for the United States government.
- As it stands the pay-as-you-go system will fail to be sustainable by 2017 when the number of those drawing social security will outstrip those contributing. The trust-fund set up during the Regan administration will be empty by 2041, and future retirees will receive as little as seventy five percent of their defined benefits.
- Social Security reform is thus a matter of necessity.
- Private retirement accounts (PRAs) are actually economically sound PROVIDED they are implemented correctly.
- Pay as you go as it now works: http://gothamgazette.com/graphics/ss_chart.jpg This was great when the ratio of workers was 2:1 not so great when it's headed towards 1:2.
- PRAs are immediately channeled to beneficiaries so you're funding yourself. Not counting on a dwindling ratio to maybe one day sort of fund you in the future.
- Social Security Taxes come with an estimated 2.6% annual return rate, in contrast to the estimated 9.3% return in nonfinancial corporate capital and leading to a loss of real income of 6.7%.
There's more but the details get boring and you can more or less goggle it.
Which isn't to say that you don't have a point and there's nothing *wrong* with PRAs (because you do and there are) - but like... there's sound economics behind the social and financial benefits of PRAs. And yes, stocks are inherently risky but, technically, so are banks and bonds. This is why you diversify your investments.