00:00 SS – Run Out Of Money?
00:52 How It’s Funded
02:02 Running Out?
03:39 Increasing Age
04:32 Rework Formula
05:08 Increasing Taxes
05:58 Investment
07:17 Individualization
08:53 Promotion of Literacy
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A recent survey conducted by CNBC found that a staggering 40% of Millennials believe they won’t receive any Social Security benefits when they retire. This statistic is troubling for both the individuals who hold this belief as well as for policymakers who must address the long-term sustainability of the Social Security program.
Social Security has been a cornerstone of retirement planning for Americans for decades. Established in 1935 as a safety net for seniors, the program provides a source of income for retirees through a combination of taxes paid by current workers and benefits received by current retirees. However, the program is facing significant challenges as the population ages and the ratio of workers to retirees decreases.
One of the main reasons why Millennials are pessimistic about Social Security is the fact that the program is projected to run out of funds by 2035 if no changes are made. This means that benefits could be reduced by as much as 25% for all recipients, including current retirees. With this looming financial crisis, it’s understandable that Millennials are skeptical about the future of Social Security.
Additionally, Millennials are also facing their own financial challenges that make them doubt the reliability of Social Security. With high levels of student loan debt, stagnant wages, and the rising cost of living, many Millennials are struggling to save for retirement. This has led some to believe that they won’t be able to rely on Social Security as a source of income in their later years.
The implications of this belief are significant. If Millennials do not trust in Social Security as a retirement safety net, they may be less inclined to contribute to the program through payroll taxes. This could further weaken the program’s financial stability and put future retirees at risk of receiving reduced benefits or no benefits at all.
Policymakers must address the concerns of Millennials and work towards finding solutions to ensure the long-term viability of Social Security. This may involve raising the payroll tax rate, increasing the retirement age, adjusting benefits for higher-income earners, or exploring other innovative solutions to secure the program’s future.
In the meantime, it’s important for Millennials to take control of their own retirement planning and savings. By investing in retirement accounts, creating a budget, and seeking financial education, Millennials can improve their financial outlook for the future and mitigate the potential impact of Social Security uncertainty.
While the future of Social Security remains uncertain, Millennials should not lose hope in the program entirely. It’s essential for policymakers and individuals alike to work together to secure the future of Social Security and ensure that all Americans can retire with financial security.
The main solution, not mentioned here, is how can we make the Government more accountability for the stewardship of our money!
Increase Age –> How can we give the Government less accountability.
Rework Formula –> How can the Government take more from productive individuals.
Increasing Taxes –> How can we give the Government more money to squander
Social Security was underfunded by $20B last year. Our Government just signed a $95B spending bill for Ukraine, Israel, Taiwan. Social Security would NOT be at risk if we took 1/3 of the money we fund foreign wars with and actually paid our at home obligations. Everyone SHOULD have the same answer and demand here from our Government. This is not political, but simply a mater of practicality and order of priority and obligation.
They are likely right. And gen x will get 85%. But it will only go down from there.
Only way that ss can continue is with gdp and population growth. Neither can survive forever. So eventually when it reaches its 0 first derivative (pay in to pay out slope) benefits start getting reduced.
I can see younger generation is not getting Social Security because why do you have to pay AI or a robot Social Security benefits
employer match is effectively superannuation albeit much lower percent. SS is guaranteed benefit, superannuation based on market is not, which is the reason SS has to invest in treasuries. Yes, even though the market over time "averages" a positive rate of return, you wouldn't want bill due during negative periods, which is what would happen since the govt is perpetually paying out SS benefits. I do like mandating employers contribute higher match like superannuation along with the more realistic SS payroll tax for both employer and employee compared to the benefit. The trust fund projections are sort of a lie. They are based on the worst case scenario that 100% of americans take ss at the first gate, which is why the govt pushes so hard to entice people to delay to 67 or 70. More importantly, any surplus trust fund is spent, because the Treasury spends available money first. If Congress got rid of the thou shall spend money from what it has in the coffers first, then we wouldn't see this trust fund depletion. However, since SS is a legal ponzi scheme, since you are robbing peter to pay paul more than what paul and his employer paid in, you need to increase revenue to support the system. Increasing the full benefit doesn't work, simply because most americans will take at the first gate and since it is a ponzi scheme it already doesn't take in more than it pays out. With more underskilled or no skilled population flooding the US, our tax base for ss revenue is decreasing, and you won't make that up by taxing the just the 1%. I think the wealth tax idea is all but dead given the series of recent unamimous to nearly unaminous SCOTUS rulings based on takings clause. So, you are left with preventing Treasury from using cash on hand and increasing employer and employee contribution mandates.
Doesn't matter if I get it or not. I could utilize/invest that money WAY better than the dumbass government can. It's theft.
When I started my working career 32 years ago , I thought SS would be little when I retire. So we saved in our retirement as such ,will not need SS. Everyone should do the same . SS will not go way , will be changes in the future generations.
SS needs to be phased out entirely. If everybody was forced to put what they pay in SS to a 401k based on the SP500 instead throughout their life they would be ALOT better off
Excellent information Erin.
My economics professor in the early eighties told us we contribute to social security to keep our elders from starvation, but we should expect to receive nothing but to know we did the right thing. I did not personally act on this knowledge soon enough, but it has haunted me. And yes, that is me with my kids encouraging them to start earlier. POI is a thing. Learn from my mistakes. Expect nothing. Anything you may receive is a complete bonus.
More than 40%. Most of us don't believe in this ponzi scheme. We're being fleeced.
The system is pretty broken. I would rather everyone just keep their money and manage it themselves.
If only social security was the only tax I paid for nothing in return.
Since a young age, I have assumed most people will die before getting any Social security. I know overall life expectancy is high, but people who can barely afford housing and food, will not get much medical attention. Once people retire in non pension systems, they won't have the collective bargain healthcare current retirees have. Medicare does not really incentivise people to seek early help, and for most currently on employer plans, we already pay high fees to go. So, I think many millenials like myself assume we will be dead by 67-70, due to healthcare issues, than collecting social security. Also, will employers have to pay by the robot in future? Already we have lots of automation in work places reducing staff, so logically taxes towards social security will drastically drop, as more people are underemployed or unemployed.
hard facts unless the government fixes it without deficit spending… oh wait our government can't. I am not even counting on it. if it's their great, if not oh well
I do agree that there may be some money in the end for all of us, but let’s look at the real issue here one of them anyways.
The max right now stands to get full benefits is 67 years old. You can start at 62 to get Social Security benefits partial. Men on the average live to be 73 to 74 years old so the majority of those who do get Social Security benefits majority of time is only women when men only lived to enjoy some full retirement from the government only seven years based on statistics. What’s the point of us even paying money into the system if we don’t even get to enjoy our retirement and live here long enough to actually enjoy it. The system needs to be more realistic, simply the COL calculations and the average lifespan per sex.
Basically the whole system needs to be redone. The current one is not sustainable we need one more like Norway pension fund. It would also need to reduce the max age to gain full SS benefits to 60 and start as early as 55 instead.
We can't let them raise the retirement age. We need to remove the cap. The higher tax isn't going to keep people from going for those jobs.
Wife and I are 33 with about $800k in investments, excluding home equity and rainy day funds. I've always strived to stay on top of my finances, hoping that being disciplined in my 20s would allow me/us to have more breathing room in our 40s+ but it gets hectic, should we get a partner?
Wife and I are 33 with about $800k in investments, excluding home equity and rainy day funds. I've always strived to stay on top of my finances, hoping that being disciplined in my 20s would allow me/us to have more breathing room in our 40s+ but it gets hectic, should we get a partner?
Wife and I are 33 with about $800k in investments, excluding home equity and rainy day funds. I've always strived to stay on top of my finances, hoping that being disciplined in my 20s would allow me/us to have more breathing room in our 40s+ but it gets hectic, should we get a partner?
Whether you think you do or do not, make sure you dont have to rely on it to retire.
Erin confirming what I was arguing on her last video relating social security to low-information, reactionary brainlets.
I paid this money in and I want it back. It’s aggravating to see our govt spend it once it went into the general fund.
40% of millennials are not naive
Anybody who believes in taking responsibility and control of their own financial future doesn't take it into consideration. I'll probably get some, but I don't consider it in my calculations.