# How long, and under what conditions, do you think SS will last?



## Sawfish (Saturday at 9:30 PM)

This isn't rhetorical. I'm kicking it around to help in planning for my wife, who is both younger than I am, and of considerably longer-lived stock.

She's currently 66. Our retirement accounts are anticipating her to live to 105--probably optimistic, but better over-prepared than under, huh?  ;^)

I'd like to think that it'll make it intact for 39 more years, but my guess is that there'll be changes. I'm thinking that the first will be means testing, but not sure when, or if, it'll come.

What are your thoughts on this, fellow SFers?


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## Blessed (Saturday at 10:00 PM)

I hope it lasts as long as I do.  We have all learned things can change in a heartbeat.  I guess in my mind it should be okay.  The money should be there from people that were in the workforce withholdings.  The people that have passed have left extra monies if their families were grown.  Widows have drawn on the spouses monies.  All seems above board to me other than the fact that there are some that don't get enough to have a secure and decent life IMO. In some cases special circumstances should exsist to help some stay independent, have a decent home and be able to pay the normal bills. 

I know we have public assistance to help but sometimes I wonder if that is enough once you reach a certain age. I expect a lot of push back on my words.  That is fine, I wonder what other people think. I will I am not under any strain, home, car, paid off,  good health insurance, money in retirement accounts. Not rich by any means but blessed because at this point I don't have to worry.


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## Alligatorob (Sunday at 6:14 AM)

Sawfish said:


> How long, and under what conditions, do you think SS will last?


So long as the economy holds out I think it will be there...  Changes of course, maybe less generous, maybe not, who knows.

The big if is the economy holding up.  I believe the odds are it will for the next 39 years, but nothing lasts forever...


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## Sawfish (Sunday at 7:42 AM)

You know, if they have brackets for Medicare premiums, I'm betting there'll be brackets for SS within the next 20 years.

Not that I'll be affected...  :^)

But think about how certain official or spokesmen recently (year or so?) argued to up the tax limit for SS, which is capped at 150K per year, I'm thinking.

Now, your benefit is already capped, and that's OK so long as your taxable contribution is also capped. But the suggestion to extend the taxes out beyond any proportional benefit was a pretty clear instance of a sort of progressive approach to the SS system.

And what's going to happen, I'm afraid (for my wife), is to see that they'll have a repeating shortfall and one way to partly shore it up is to pay out less. It'll be presented as "Well, they don't really need all of it, and if the rest of you want to continue to get your full benefit, we'll need your support to get this into effect." Initially, the threshold at which benefits are reduced proportional to income will be relatively high, perhaps affecting only 10-15% of SS recipients, but they'll gradually walk it up.

Same like with after the 16th amendment and income taxes.

Yep. That'll do the trick.

But, you know, it was a pretty questionable system to start with, when you thin about it.


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## Right Now (Sunday at 7:51 AM)

The experts working on this dilemma have assured us already it will be safe until 2035.  That's not so far away.
But.....there are many factors I keep thinking about.

Many are no longer working after 55 or even 62, so not contributing. If that is the case, their earnings will be smaller, so will their monthly SS check payout.  If COVID has so many deaths of people over the age of 65,  their monies set aside for 30 years of payouts is still in the SS funds.  This money, does accumulate some interest yearly (wherever SS stashes these funds for safety and security until needed for those under 66 who contribute yearly for decades).

There are many variables, different scenarios, and bottom line is that for years this very question of how long SS will be a reliable source of income will be asked.


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## Sawfish (Sunday at 8:10 AM)

Right Now said:


> The experts working on this dilemma have assured us already it will be safe until 2035.  That's not so far away.
> But.....there are many factors I keep thinking about.
> 
> Many are no longer working after 55 or even 62, so not contributing. If that is the case, their earnings will be smaller, so will their monthly SS check payout.  If COVID has so many deaths of people over the age of 65,  their monies set aside for 30 years of payouts is still in the SS funds.  This money, does accumulate some interest yearly (wherever SS stashes these funds for safety and security until needed for those under 66 who contribute yearly for decades).
> ...


I'm not actually satisfied, though. We're talking about two vague "if's" (trend to quit working early and number of COVID deaths) and to find any comfort I'd want much more detail. If people are quitting earlier, how do they live? If it's because they had high income during their lifetime, then their benefits would not necessarily be down; not only that, they'll be drawing for a longer period, on average. How many people over 66 have died from COVID *over the expected number of normal deaths* were there? And is this still going on, because if not, it was a relatively meaningless blip in the general trend.

I know the question has been asked, will be asked, but me, I'm trying to build a most likely scenario to build for my wife.


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## Disgustedman (Sunday at 1:07 PM)

I'd say "For now" SS is ok. But frankly, If I had house paid off, I'd be putting in some "Prepped" food (good for 10 years) just as a society fail fall back 

I won't go out on a biblical limb, but think in 20-30 years, the world landscape will take a massive change.


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## leastlongprime (Sunday at 1:08 PM)

I too, expect some type of SS brackets sooner than later. 
Our politicians are too timid to attack the issue, and its way too late.


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## HoneyNut (Sunday at 1:22 PM)

One of the retirement webinars given where I used to work said SS is an extremely popular program and there are several ways to fix it and we could depend on politicians realizing it is in their best interest to rescue it.

It would be nice if rich people were not so entitled and were willing to not take Social Security when they find that they have arrived to retirement age with several million dollars already and don't need SS.  One of my great uncles never cashed any of the social security checks he received (though that was probably more of a political feeling than a generous impulse toward poorer people).

I think the SS trust fund is invested in US Treasuries, if that is true, they are paying much better rates right now, maybe that will help a little.


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## Teacher Terry (Sunday at 1:27 PM)

_Due to WEP SS is a small part of my retirement income. I am glad most of my income comes from my state pension which is well funded.  I doubt that they will cut it for people at the lower end of the income bracket. _


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## Sawfish (Sunday at 1:28 PM)

leastlongprime said:


> I too, expect some type of SS brackets sooner than later.
> Our politicians are too timid to attack the issue, and its way too late.


OK, assuming brackets, what legal ways to we have to control this a bit, on the personal level?

You want to stay below the threshold for reduced payments, so this means to minimize taxable income, and this would imply that if you right now set aside a large amount of savings that have already been taxed, and further, that any income generated by this hopefully large account is itself tax free or minimally taxed.

Gosh. It sounds like Roths, doesn't it. Max out on Roths as a hedge against reduced SS benefits.


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## HoneyNut (Sunday at 1:44 PM)

Sawfish said:


> You want to stay below the threshold for reduced payments, so this means to minimize taxable income


I think it would make more sense if the SS brackets were based on net worth (similar to qualifying for subsidized housing), all the special rules about what "income" is makes income a poor choice.


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## Sawfish (Sunday at 1:53 PM)

HoneyNut said:


> I think it would make more sense if the SS brackets were based on net worth (similar to qualifying for subsidized housing), all the special rules about what "income" is makes income a poor choice.


Well, then, if assets, start divesting or restructuring ownership if/when it looks like means testing is getting close.


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## squatting dog (Sunday at 2:12 PM)

If all the money stolen by congress from the SS fund and replaced with IOU's was returned, this wouldn't be a conversation.


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## Don M. (Sunday at 2:57 PM)

It's not only SS that is going to be in trouble....rather, it's our entire economy due to our "out of control" National Debt.  The debt is already over 31 trillion and growing by millions/day.  We are wasting billions just paying for the interest on this debt, and it will only get worse as the Fed continues to raise the rates trying to fight inflation.  At some point, in the not too distant future, the government will have no choice but to devalue the dollar....as other nations have had to do.  When, not if, that happens, the cost of everything will double, or triple, and the majority of people will be thrust into poverty.  

Governments are no different than individuals....when their debt far exceeds their ability to pay...the bottom falls out.  Sure the government can run the printing presses 24/7, but when that dollar only purchases a fraction of what it used to, it becomes almost worthless.


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## Right Now (Sunday at 3:02 PM)

squatting dog said:


> If all the money stolen by congress from the SS fund and replaced with IOU's was returned, this wouldn't be a conversation.


You are definitely looking at wrong sources for your statement.  

https://www.nasdaq.com/articles/how-much-money-has-congress-taken-social-security-2019-02-04

*The fact is that Congress, despite borrowing $2.9 trillion from Social Security, hasn't pilfered or misappropriated a red cent from the program.Feb 4, 2019*


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## Right Now (Sunday at 3:04 PM)

​Here is the entire article.    Read it yourself or see the excerpt below.

https://www.fool.com/retirement/2020/02/15/the-surprising-amount-of-money-congress-has-stolen.aspx
Did Congress really raid Social Security?​One of the more common theories as to why Social Security is facing a huge long-term cash shortfall is that lawmakers in Congress have pilfered cash from the program and never returned it.

This idea goes all the way back to 1968, when then-President Lyndon B. Johnson made a change to how the federal budget would be presented. Prior to 1974, before Congress had an independent budgeting process, the President's Commission on Budget Concepts had three separate budgets, all of which had differing deficits. To simplify things, Johnson called for Social Security and its trust funds to be included in the annual federal budget.

In 1983, the Reagan administration voted to undo this change and once again remove Social Security from the federal budgeting process. This was done to ensure that changes made to the program are done solely on the merits of the program, and not to balance the federal budget.

Where the idea comes into play that Congress stole from Social Security is, during this 1968 to 1990 period (1990 is when Social Security was completely off-budget again), it's believed that lawmakers commingled Social Security's asset reserves (i.e., its aggregate annual net-cash surpluses built up since inception) with its General Fund to pay for wars and other line items. The belief among some folks is that Congress has stolen trillions of dollars from Social Security, and that if this money were simply returned to the program, it wouldn't be in such dire financial shape.

*But the real surprise, upon digging deeper, is that Congress hasn't stolen a dime from Social Security.*


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## Sawfish (Sunday at 3:17 PM)

Don M. said:


> It's not only SS that is going to be in trouble....rather, it's our entire economy due to our "out of control" National Debt.  The debt is already over 31 trillion and growing by millions/day.  We are wasting billions just paying for the interest on this debt, and it will only get worse as the Fed continues to raise the rates trying to fight inflation.  At some point, in the not too distant future, the government will have no choice but to devalue the dollar....as other nations have had to do.  When, not if, that happens, the cost of everything will double, or triple, and the majority of people will be thrust into poverty.
> 
> Governments are no different than individuals....when their debt far exceeds their ability to pay...the bottom falls out.  Sure the government can run the printing presses 24/7, but when that dollar only purchases a fraction of what it used to, it becomes almost worthless.


What will be your strategy for that?


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## squatting dog (Sunday at 5:51 PM)

Right Now said:


> You are definitely looking at wrong sources for your statement.
> 
> https://www.nasdaq.com/articles/how-much-money-has-congress-taken-social-security-2019-02-04
> 
> *The fact is that Congress, despite borrowing $2.9 trillion from Social Security, hasn't pilfered or misappropriated a red cent from the program.Feb 4, 2019*


The Gramm-Rudman-Hollings act, called "GRH" mandated that the Trust Funds be included in the budget for the purpose of determining if the total budget exceeded the deficit targets in the law. This provision was to be in effect for the entire time that GRH was in effect, which turned out to be 1986-1993.
The import of this provision was that when the federal budget exceeded the Gramm-Rudman targets, automatic across-the-board sequestration of spending kicked in. So including Social Security in the triggering calculations made the sequestration less likely (since the Trust Funds were running surpluses after 1983).  So while the Social Security program was off-budget, and immune from sequestration or other generalized budget  cuts, its SURPLUSES  WERE STILL BEING USED TO REDUCE THE SIZE OF THE BUDGET
DEFICIT.
So, That sure looks like money came from SS trust fund to finance things other than SS, and never found it's way back.

Note that the financing procedures involving the Social Security program have not changed in any fundamental way since they were established in the original Social Security Act of 1935 and amended in 1939. These changes in federal budgeting rules govern how the Social Security program is accounted for in the federal budget, not how it is financed. Brings to mind the old saying... Figure's lie and liars figure.


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## squatting dog (Sunday at 6:02 PM)

On a personal note, I really don't trust much news that is culled from news sources these days. (actually from around 2010 or so), as it's painfully obvious that they have mostly been corrupted by political agenda's on both sides.


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## Harry Le Hermit (Sunday at 6:12 PM)

squatting dog said:


> So, That sure looks like money came from SS trust fund to finance things other than SS, and never found it's way back.


All tax receipts go into the general fund. In 1935, when Social Security legislation was passed, it had to pass Constitutional muster. Hence the accounting gimmick of the so called trust fund.

To overcome and prevent challenges in the courts, many "trust" funds have since been created, such as the highway trust fund, etc.

The notion that S.S. has been robbed, suggests it should simply have accumulated somewhere in a vault... without accruing interest. That accrued interest is about 70% of the current trust fund.


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## Sawfish (Sunday at 6:52 PM)

Harry Le Hermit said:


> All tax receipts go into the general fund. In 1935, when Social Security legislation was passed, it had to pass Constitutional muster. Hence the accounting gimmick of the so called trust fund.
> 
> To overcome and prevent challenges in the courts, many "trust" funds have since been created, such as the highway trust fund, etc.
> 
> The notion that S.S. has been robbed, suggests it should simply have accumulated somewhere in a vault... without accruing interest. That accrued interest is about 70% of the current trust fund.


So are you saying that in your opinion the SS fund is intact and will probably operate as it currently does for the foreseeable future--say about 30 years or so?


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## Harry Le Hermit (Sunday at 7:06 PM)

Sawfish said:


> So are you saying that in your opinion the SS fund is intact and will probably operate as it currently does for the foreseeable future--say about 30 years or so?


No. The SS fund is likely to be depleted circa 2033, but continue to operate at reduced benefits... say 75%. Which is technically a default, but there is no recourse, unless the funding issues and/or payouts are addressed. 

It is no different than any bank's interest bearing checking account (reserve account). When it hits zero, you can only pay the bills as money comes in. In a similar situation, you would likely miss 3 payments in the first year (25%), as you can't pay out until you got money in that interest bearing checking account.

In summation, possibly the next 10 years will still fund as normal, but then the number of monthly payments per year will decrease. 

So hope for the best, and plan for the worst.


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## Sawfish (Sunday at 7:13 PM)

Harry Le Hermit said:


> No. The SS fund is likely to be depleted circa 2033, but continue to operate at reduced benefits... say 75%. Which is technically a default, but there is no recourse, unless the funding issues and/or payouts are addressed.
> 
> It is no different than any bank's interest bearing checking account (reserve account). When it hits zero, you can only pay the bills as money comes in. In a similar situation, you would likely miss 3 payments in the first year (25%), as you can't pay out until you got money in that interest bearing checking account.
> 
> ...


Yes. Plan for the worst likely, not the worst possible. The former is almost always do-able, while the latter is impossible because it's largely unbounded.


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## Knight (Sunday at 7:36 PM)

Sawfish said:


> I'd like to think that it'll make it intact for 39 more years, but my guess is that there'll be changes. I'm thinking that the first will be means testing, but not sure when, or if, it'll come.
> 
> What are your thoughts on this, fellow SFers?


Mr. Gloom & Doom here.


Given the projections that SS will need payout reduction around 2035 a healthier financial base would be something to consider.  More to consider is the projection that natural resources will be diminished  quite a bit in 30 years. How to plan for that  when it took 11 years for the population to grow to eight billion from seven billion, the United Nations said it expected 15 years to pass before we reach nine billion, in 2037, and another 22 to pass before 10 billion, in *2058*.Nov 15, 2022.  Concern for finances will probably be secondary to where to get food,  & everything else we enjoy now.


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## Sawfish (Sunday at 8:05 PM)

Knight said:


> Mr. Gloom & Doom here.
> 
> 
> Given the projections that SS will need payout reduction around 2035 a healthier financial base would be something to consider.  More to consider is the projection that natural resources will be diminished  quite a bit in 30 years. How to plan for that  when it took 11 years for the population to grow to eight billion from seven billion, the United Nations said it expected 15 years to pass before we reach nine billion, in 2037, and another 22 to pass before 10 billion, in *2058*.Nov 15, 2022.  Concern for finances will probably be secondary to where to get food,  & everything else we enjoy now.


Could be.

But I've got some level of control over our financial strategy and almost none over world resource allocation. I'm going to have to limit it to financial stuff.


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## C50 (Monday at 9:23 AM)

I think some sort of social security type program will always be around, how those programs are funded is the mystery.  

Society wants to protect its citizens, but we don't want the responsibility as individuals, so that leaves the govt. to step in and create programs.  But it ends up being a dog chasing its tail scenario; where does it start and where does it end? Where does the money come from?  

Sadly we will never live in a world of complete self responsibility, there will always be a segment of the population that can't or won't take care of themselves, during their lives and certainly with no consideration to retirement planning.  So what happens with those people?  Do we just discard them?  Create poverty cities for them and let them fend as they may? It's easy to think yes but that's not reality, it's not how evolved societies work.

So that circles me back around to believing there will always be some sort of social security program.


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## StarSong (Monday at 11:14 AM)

I think SS will be cut for future recipients, perhaps those who are under 40 at the time of the rejiggering, but will not affect people who are already receiving it or are on the precipice of getting it. 

Members of Congress who vote in favor of benefit cuts for current SS recipients would find themselves looking for a job when they're up for re-election and they know it.  

They'd not only motivate seniors to oust them, they'd motivate a whole lot relatives who might be facing couch surfing grandparents in the living room.


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## David777 (Monday at 11:19 AM)

Any changes are not likely to affect we seniors already receiving benefits but rather those still of working age that can plan for shortcomings.  So not an issue for current seniors beyond inflation.


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## StarSong (Monday at 12:37 PM)

David777 said:


> Any changes are not likely to affect we seniors already receiving benefits but rather those still of working age that can plan for shortcomings.  So not an issue for current seniors beyond inflation.


Agreed.


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