Medicaid & SSI

[steven]

Would there even be a Medicaid & SSN crises/shortfall if the only people to receive these benefits where the people that the programs where originally intended for?

IE: SSI was originally supposed to be a safety net retirement program ( correct me if I am wrong, Im not 100% on the history of the program) but it has been expanded to cover many different groups of people.

[jbinbny]

Your not wrong. SSI not intended to be America's main source of income at retirement, but merely to supplement it.

Which naturally lends itself to the question "what should be Americans primary source of retirement income?"

I think the answer was always a combination of savings( of which americans are woeful at), job related pension( of which fewer and fewer employers offer and fully fund) and SSI.

Given the uncertainty that exists in SSI and with the impending pension crisis looming large, more and more americans need to be saving as never before. That means 401k contributions, Roth IRA's and lowering their overall debt! most americans are up to their eyeballs in debt!

With this being said, I know that it is easier said than doone. But each one of us must take a greater interest in his/her personal retirement.

I am in favor of allowing a portion of your SS to be deposited in a private account which you control. I dont think the 4% figure being proposed is outrageous.And it is voluntary, not mandatory!

[NoCtUrNaL]

Originally posted by steven
SSI was originally supposed to be a safety net retirement program ( correct me if I am wrong, Im not 100% on the history of the program) but it has been expanded to cover many different groups of people.

I think you're referring to Social Security Retirement.

SSI & SSD are different...

Social Security Disability (SSD) is paid to individuals who have worked in the recent years. Usually you have to work 5 out of the last 10 years.

Under the federal Social Security Disability Act, "disability" means the "inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or has lasted or is expected to last for a continuous period of not less than 12 months."

Supplemental Security Income benefits (SSI) Are paid to individuals who are poor and disabled whether or not the individual has worked in the past

[biker]

My take on the history of Social Security is that a growing pile of dough in the 50s and 60s was irresistible to the politicians. They could make up new entitlements, hand out benefits and not have to tax anyone for them.

What's not to like if you're a pol?

[biker]

JB

You're absolutely right. Saving and investing on your own is the only guarantee you have for anything.

Bush knows this. So do the Dems. If people had their own retirement accounts, they wouldn't need Uncle Sam to keep 'em alive. That's why they hate him.

There are a couple of easy steps to save:

Spend less than you earn
Bank any raise you get

It sounds too simple, but it let me retire early.

Now, I'll wait to see if my kids implement it.

[Linda_D]

The Social Security Retirement System was set up during the Great Depression to provide a base retirement system for workers. At the time it was set up, many, many middle class Americans' retirement savings had disappeared with failed banks. Moreover, there were virtually no corporate pension plans for most factory or clerical workers, so saying that SSR wasn't "intended" to be the primary source of retirement benefits isn't correct. Pension plans for private and public employees really began to take hold in the 1950s.

Originally, SSR covered workers and their widows (since few, if any, married women worked outside the home for wages at the time). I'm not sure if dependent children were covered in the original SSR or not. Until the 1970s, dependent children were covered through age 21 if they were still in school (including college). In the late 1970s, this part of SSR was changed to limit the age of children covered through SSR to 14 (about 8th grade).

SSD and SSI were also added later. They are part of the problem with Social Security because SSI recipients may have never contributed and SSD recipients may have contributed a very small amount compared to SSR recipients -- and they may be on SSD much longer.

Another, probably bigger, part of the problem is that people are living longer. When SS was created in the 1930s, people in their 80s and 90s were relatively rare, but not today. When SSI was set up, many of the recipients, particularly children with genetic and congenital diseases and conditions, died young. They, as well as SSD recipients, are living much longer nowadays.

[steven]

Originally posted by biker
Bush knows this. So do the Dems. If people had their own retirement accounts, they wouldn't need Uncle Sam to keep 'em alive. That's why they hate him.

But what do we do with the people that screw up that investing? When retirement time rolls around and their investments have tanked and they have no money?

I think this is a real thorny issue, I have no answer but I am not sure of any of the answers others are giving either.

[NoCtUrNaL]

Originally posted by steven
But what do we do with the people that screw up that investing? When retirement time rolls around and their investments have tanked and they have no money?

Soylent Green

[biker]

Nocturnal

Rapier wit again

[biker]

Originally posted by steven
But what do we do with the people that screw up that investing? When retirement time rolls around and their investments have tanked and they have no money?

If I didn't know better, I'd figure you for a Dem Party operative. That's their ultimate scare tactic. Dredges up memories of the Crash.

The 1930s were the Golden Age for the Dems. There was Roosevelt. Poor people everywhere. There was Roosevelt. So dejected everyone was looking for help from the government. There was Roosevelt.

The History Channel had a special on Rosie. He didn't want to run again in 1940 (yeah, right. Please make me.) His own analysis was that he had tripled taxes and the unemployment rate was right where it was in 1932. He had a record and it wudn't good.

[biker]

Sorry Stephen, I got off track.

With diversification, people won't lose their investments.

There's about thirty years of experience with IRAs and 401(k)s. If there were big problems with the concept, we'd have heard about it.

The one big problem was corrupt companies that made the employees take company stock. That might have been stopped. It's against basic diversification.

People could be brain-dead and stick it in a bank account and they would triple the return they get from social security.

[biker]

The big threat to 401(ks) is the goverment.

If you don't take out the right amount, they tax you. At 50% of the amount you should have taken.

Be patient with me here, but here's how the law was writ the last time I looked:

By April 1st of the year following the year in which you reached age 691/2 (with me so far?) you must take as a distribution an amount equal to an actuarially-determined minimum based on your life expectancy as published in tables by the IRS.

If you take less than that, you owe the gov an "excise" tax of 50% of the amount between what you took and the minimum.

Phew.

Compared to complying with crap like that, deciding to invest in an S&P index fund is a piece of cake.

[Linda_D]

If the government really wanted to encourage people to save, particularly people at the lower-end of the economic ladder, then the first $200 or $500 or $1000 in interest would be tax exempt -- and bank fees on savings accounts would be tax deductible.

What incentive is there today for people, especially young people, to get in the savings habit -- to plunk $10 or $20 a paycheck into a savings account? Whatever meagre interest you earn, it's taxable, and if it puts you in a higher bracket, you really know it. Moreover, if you're just starting out saving and don't have a lot, bank fees on small accounts can suck up your savings like a fire hose.

[NoCtUrNaL]

Originally posted by Linda_D
If the government really wanted to encourage people to save, particularly people at the lower-end of the economic ladder, then the first $200 or $500 or $1000 in interest would be tax exempt -- and bank fees on savings accounts would be tax deductible.

Yeah...that's my take on it too, in fact, I'd take it a step further, if the government is so interested in my being financially independent then the most encouraging thing they could do is not only stop raising and creating new taxes, but lower those I pay now.

Of course, that would mean the government would have to tighten its own belt. HA!

[tronix75]

Originally posted by biker
If I didn't know better, I'd figure you for a Dem Party operative. That's their ultimate scare tactic. Dredges up memories of the Crash.

The 1930s were the Golden Age for the Dems. There was Roosevelt. Poor people everywhere. There was Roosevelt. So dejected everyone was looking for help from the government. There was Roosevelt.

The History Channel had a special on Rosie. He didn't want to run again in 1940 (yeah, right. Please make me.) His own analysis was that he had tripled taxes and the unemployment rate was right where it was in 1932. He had a record and it wudn't good.

Ya...I watched that documentary on FDR. I never liked FDR or his domestic policies, you can trace a lot of our current social problems caused by Federal and State mandates to the precedents created by his aministration.
I knew that many of his critics called him a "socialist", which was basically accurate, but I didn't know until I heard it on the History Channel documentary, was that his own mother refused to pay Social Security Taxes for herself and her employees, and didn't.
FDR himself had to pay her taxes to keep that embarassment out of the public eye.