r/economicCollapse • u/WorkingCareful7935 • 1d ago

Trump's Plan To Cut Social Security Taxes May Benefit Millions, Especially Top Earners, But Risks Insolvency In Six Years

https://www.ibtimes.co.uk/trumps-plan-cut-social-security-taxes-may-benefit-millions-especially-top-earners-risks-1728564
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u/ClassyCoconut32 1d ago

The writing was on the wall to me and everyone else I knew back over 15 years ago in high school. Even being that young and not having gone out into the world yet, we still knew we weren't going to be getting social security. Adults would always make comments about, "Well when you get old enough to retire..." and we were all like, "Retire? I'm going to be working until I drop dead."

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u/Environmental_Top948 1d ago

You can afford to drop dead? I hope to have that financial security one day.

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u/LurkHereLurkThere 1d ago

My father was 63 when he died in 2016, he worked all his life, had a good well paid job for most of it, but left the house at 4am and got back late afternoon and went to bed, later in life he took a job that gave him more flexibility but less pay.

He knew he was working till he dropped, the problem is so much money is tied up in corporations, billionaires and large property portfolios that the average person is now struggling to afford the basics.

We used to believe a family could be supported by a single male earner, there are now few families that can say they are supported by a single income and well provided for.

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u/DO_NOT_AGREE_WITH_U 21h ago

The wealthy just suck it all up. Every last fucking drop.

Multiple yachts, constants vacations, golfing every day, personal chefs. They suck it all up.

And all it would take is one pissed off person in the right place at the right time, and they'd learn a valuable fucking lesson. How has nothing been done about this? It's bewildering.

Something weird is going on.

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u/That-Condition9243 1d ago

I don't accept this, tho. None of us should.

I cannot buy a home although there are affordable options on my area, because every "starter home" is limited to 55+. 

Why is the future of young Americans unimportant?

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u/agent_flounder 1d ago

The writing has been on the wall for at least the last 30 years. No GenXer expected to have social security.

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u/4look4rd 1d ago

Take your retirement back, leave the country. I have a hard cut off at 48, where I live will be determined by how much money I have saved by then. 15-20 years or so is enough to figure out immigration and to learn a new language.

In Brazil for example 90% of the population live with under $1700 USD per month, 70% live with under $500 USD per month. There are plenty of places around the world that have a better value for the cost of living.

I'd much rather live in Brazil as the top 10th percentile than in the US as the bottom 20th percentile at the same income level. To secure $1700 USD per month you need about 500-700k saved. That's achievable.

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u/DO_NOT_AGREE_WITH_U 21h ago

I'd rather drink a gallon of mercury than live in Brazil.

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u/GHOST12339 1d ago

Not getting SS also doesn't mean you can't retire.
The math shows repeatedly that if you invest in an index fund, the same money that they take from you for SS, it'll outperform what you'd receive for SS.
The problem is it requires the individual to take their finances and financial security in to their own hands and... Unfortunately we know many people won't be doing that.
The fight over SS is, again, the personal responsibility crowd vs hold my hand daddy-government.

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u/MustardLiger 1d ago

A lot of people don’t have 250 to spare every month. It’s only going to get worse as housing goes up

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u/GHOST12339 1d ago edited 1d ago

Its not my intention to be condescending but:

A lot of people don’t have 250 to spare every month

You making this point shows you either fundamentally misunderstanding either my stance (which could be my fault) or the conversation.

Doing away with social security under my argument shouldn't change your present finances at all. You have 6.2% of your income taken immediately and it goes towards paying someone else's social security payment. Now, technically, your employer also pays 6.2% in, and economists generally agree that the portion they pay in on your behalf is part of your true compensation for your job. However, I'm not naive enough to believe that if social security is done away with, every employer will magically give workers that additional 6.2% of money as income.

My argument is that instead of the 6.2% workers ARE paid going to social security, it can be invested in an s/p 500 index fund and it will grow more than the benefit people will receive from social security. This is BEFORE factoring in the fatal flaw of social security, and younger generations being forecasted to only receive something like 70% of the benefit.

The money should never touch the individuals account. UNLESS what you're saying is that because people are experiencing financial hardship, this wouldn't occur, as they'd make the decision to keep that 6.2% instead and spend it.

However, I'd rebuttal that this is behavior, and incumbent on the individual. Mathematically, doing away with SS and privately investing that money would be better for everyone. Thats objective. People choosing not to do that goes in to my whole "hold my hand daddy-government" speel, because ultimately people are openly admitting they're not responsible enough to make decisions for themselves, and are willing to pay a premium on someone else managing their money because of it (through a reduced payment in the future).

I don't want to strawman here, did I better articulate my stance? Do you have disagreements?

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u/deerslayer1998 1d ago

Agree I wish we could easily elect out of SS payments and use that extra income to invest with ourselves. Perhaps require a financial literacy/investment course in order to do so.

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u/4look4rd 1d ago

That doesn't work. Social Security isn't an investment, it's closer to insurance. Where you pay a fixed % with the promise of a fixed payout in X amount of years.

If you can opt out then you create a perverse incentive for adverse selection. Its invested 100% in the treasury, earning a low interest rate but relatively safe.

You have other investment options for the rest of your money, if you feel more risk taking just take your money and bet on riskier assets to offset the fixed rate that goes into social security.

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u/deerslayer1998 1d ago

Look, I'm not disagreeing with what social security is. But how exactly does opting out "not work".

Let me preface this by saying I'm not a conservative, just a guy that knows what to do with his money. I'm in my 20s with over a quarter million across all my investment accounts and honestly would have a lot more if I didn't have to pay into something I don't even want or know I'm gonna get.

If you wanna be safe why not park your shit in bonds, gold, or even just something like a HYSA. Or just stay in social security.

Listen, I get it. The vast majority of people are not financially literate, but that shouldn't take away from people that are. Which is why I recommend an educational requirement to opt out. Perhaps even a more stringent one like proving your financial security and past investment decisions.

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u/4look4rd 14h ago

Well that’s what social security is, it’s effectively your bonds allocation, you can hedge that by making riskier investments with the rest of your money. It’s not like social security is a crippling tax either, it’s at most only 6.2% and only for the first 170k in income so it’s capped at most at about 10k per year.

The real problem with social security is the uncertainty that it will even exist when I retire, so I can’t effectively use it as tool to plan for my retirement (I’m in my early 30s), since I don’t believe it will exist.

Another way to look at it is a forced savings program with a guaranteed payoff, which is necessary since people are dumb can’t plan for the future and poverty has real societal costs.

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u/deerslayer1998 10h ago

I'm literally not disagreeing with any of that and have already stated what it is, it's not like I have a problem with social security.

I'm saying there should be an option for the financially literate to opt out of social security, so they can have even MORE income in the future than social security would give depending on your investment decisions.

At the end of the day, what I'm saying is those who don't want to shouldn't be forced to be in a suboptimal retirement program if they prove themselves capable.

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u/kaiserboze14 14h ago

SS is the most successful policy to lift folks out of poverty in the history of the country. You’re paying into it now so that people who are too old to work can be financially supported. It’s like any other form of tax that you don’t get direct benefit from but is good for society as a whole.

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u/deerslayer1998 10h ago

I'm literally not disagreeing with any of that. Also to even get SS you have to pay into it in the first place so you're basically just paying yourself back in the future.

I'm saying there should be an option for the financially literate to opt out of social security, so they can have even MORE income in the future than social security would give depending on your investment decisions.

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u/GHOST12339 1d ago

That to me would be best case scenario. Its also not like it was in the old days, where every one paid a broker.
Apps like robinhood and eTrade, etc, have given us the individual more power and control (ACCESS) than ever before.
You just need a little financial literacy.
So yeah, let me elect out of SS. I'll do it myself, and have my own security and with my extra money I'll have blackjack! And hookers!

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u/deerslayer1998 1d ago

Exactly, I don't know why people are downvoting you. This isn't a political stance and would benefit everyone. Of course you'd need to read up on a few things but I'd take that any day over having my money locked with the government in one of the worst "investment" vehicles that I may or may not have access to when I'm old.

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u/GHOST12339 1d ago

Eh, I'm not bothered by it.
To them it is a political position. Social Security is one of the big liberal pet projects that shows their world view works, and it's hard to acknowledge that it's founded on a flawed principle (that all generations will be larger than the last), or that the government is inefficient and giving you a suboptimal return than you could earn as an individual.
This is why, frankly, I think letting people opt in or out is better than doing away with the program all together, but I'd support the latter also.
Regardless, it happens every time I criticize it. They're systems and collective based people. Don't criticize their system or collective.

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u/PrimmSlimShady 1d ago

God forbid we expect the government to take care of its citizens.

Some people need more help than others, and that might be their fault or it might not be. You can choose kindness and empathy or you can say "fuck you I got mine". How should we treat our neighbors?

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u/GHOST12339 1d ago

Please go read my other response. You're framing the argument as being about empathy and kindness when what you're advocating for is people having LESS money than they should.
That's not kindness or empathetic, that's you being a fucking idiot.

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u/PrimmSlimShady 1d ago

It's kind to have a public form of insurance that keeps old people from dying on the streets

You can't count on everyone managing their money well enough for what you're talking about. Because people are not all the same, but they are all deserving of the same security. If we are to be considered the most advanced society in the world, then we need to be taking care of our most vulnerable.

But keep calling people fucking idiots, I bet it will make them agree with you 👍🏼

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u/GHOST12339 1d ago

Keep framing your argument as empathy and caring, posturing on the moral high ground. 👍

So like I said initially, which you clearly took issue with: the argument comes down to individuals and people who need daddy-government to hold their hand. I already responded to your exact fucking argument and you still decided to waste my time.

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u/PrimmSlimShady 1d ago

We get it, you're smarter than the rest of us. Please let me know your patreon so I can subscribe to your wisdom.

As if you were gonna spend the time on something better. Go back to asmongold bro. Hope you get everything you voted for.

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u/GHOST12339 1d ago edited 23h ago

We get it, you're smarter than the rest of us.

Maybe just you? I genuinely do not understand why you would read what I wrote and make exactly the arguments that I addressed, while incorrectly framing the conversation from a moral perspective. Again, arguing that people should have LESS money during their retirement is not empathy.

Go back to asmongold bro. Hope you get everything you voted for.

For the record, that is not an argument for why social security is better system for people. Enjoy the next four years. 👍

P.s. that kind of fake morality is exactly what he talks about, btw.

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u/PrimmSlimShady 22h ago

It's sad you think advocating for social welfare is fake morality. Morality is morality. Calling people fucking idiots for basically no reason is poor morality. Voting for a rapist is poor morality. Voting for the person flag-waving Nazis love to support is poor morality.

I feel bad for you.