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Author Topic: 4 Social Security myths and the reasons why they're overblown  (Read 893 times)

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Offline SirLinksALot

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4 Social Security myths and the reasons why they're overblown
« on: June 25, 2018, 08:13:05 pm »
SOURCE: USA TODAY

URL: https://www.usatoday.com/story/money/columnist/2018/06/24/social-security-myths-and-reasons-why-overblown/725288002/

by Ken Fisher


Once again, there's dire news about Social Security. Its trustees claim in their 2018 report that they must tap the program's sacred "Trust Funds" to cover this year’s benefits. And they warn that the funds will be depleted by 2034, forcing steep benefit cuts, unless Congress fixes things. Scary.

And wrong. Most Social Security fears rest on myths. Here are four of the biggest – and the reasons why they're overblown.

Myth No. 1: If the funds run out, today’s workers will never get what they put in.

Reality: As I wrote last December, the Social Security "trusts" aren't in the “lockbox” of "Saturday Night Live" fame. It is a pay-as-you-go program. Your contributions pay current retirees. And when you retire, workers pay your benefits. The funds are merely random accumulated surpluses from years when revenues happened to exceed benefits. This was never about retirees recouping contributions.

Myth No. 2: Tapping the trust funds starts a spiral toward doom.

Reality: Actually, we’ve tapped them before. In 1982, Social Security “borrowed” from the Disability Insurance Trust and Medicare Trust to pay all retirement benefits. The trustees projected that wouldn’t work past mid-1983.

But 1982 was also the last time they tapped the trust fund, thanks to 1983’s Social Security reforms. The trust didn’t expire – it accumulated a fat surplus over the next quarter century. Retirees got paid in full, on time. Tapping the fund prompted politicians to act and put in simple fixes.

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« Last Edit: June 25, 2018, 08:14:44 pm by SirLinksALot »
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Offline IsailedawayfromFR

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Re: 4 Social Security myths and the reasons why they're overblown
« Reply #1 on: June 25, 2018, 08:46:08 pm »
Fact 5: the Trust fund is a myth and has no semblance to any type of fiscal standard.

If it were used by any company in industry the way the feds do SS, the SEC would slap them down so hard they would go belly up and the Management would go to prison.
« Last Edit: June 25, 2018, 09:19:55 pm by IsailedawayfromFR »
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Offline WingNot

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Re: 4 Social Security myths and the reasons why they're overblown
« Reply #2 on: June 25, 2018, 09:17:21 pm »
I'm surprised USA Macday printed that. 
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Offline Free Vulcan

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Re: 4 Social Security myths and the reasons why they're overblown
« Reply #3 on: June 25, 2018, 11:23:36 pm »
It's all about cash flow kiddies. You can wax academic all you want, but the bank balance will dictate reality.
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Offline WingNot

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Re: 4 Social Security myths and the reasons why they're overblown
« Reply #4 on: June 25, 2018, 11:39:04 pm »
Quote from: Free Vulcan on June 25, 2018, 11:23:36 pm
It's all about cash flow kiddies. You can wax academic all you want, but the bank balance will dictate reality.

All those ill eagles will support the millennial's when they hit 68.5 years old.   
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