House Speaker Paul Ryan and his cohorts want to privatize Social Security. They claim that you can do better than Social Security (which they falsely claim is going broke). Is this a great opportunity for our retirement future? Currently you pay 6.2% of you gross paycheck for coverage. Your employer also pays 6.2%. There is a maximum annual payroll on which you contribute. In 2017, the limit is $127,200. All income above that is tax free.
There are some serious “what ifs” and reminders.
What if – Are you sure your employer will raise your pay 6.2%? If not, you will be taking a 6.2% pay cut. That is not beneficial to your attempt to save for retirement.
What if – You are injured and cannot work? You lose disability income (part of Social Security), and have NO retirement income at age 65.
What if – You become unemployed? Instead of contributing, you will be removing money from your retirement plan.
What if – We experience another 2008 where your investments tank when you are at retirement?
What if – You have a serious illness or injury which bankrupts you. Most bankruptcies are due to health costs.
What if – you are not a disciplined saver?
What if – you are not an expert investor? Rep. Ann Wagner is trying to defeat an Obama regulation designed to protect us from unscrupulous advisers.
A few reminders
About 20% (12,000,000) beneficiaries depend on Social Security for 90% of their income. Most are low income workers. It is impossible for them to save anything.
About 66% depend on SS for over 1/2 of income.
IRAs and 401Ks do not guarantee lifetime income. You could live to be 90-95. Can you save enough for this, even if they do not privatize Medicare?
Submitted by Marty Walsh
The only reason there is anything approaching a fiscal crisis in Social Security is because Republicans have been laboring for so long to starve Social Security and to impede sound management and reasonable supporting resources. Those supporting resources are primarily taxes on the wealthy.