Social Security Smart

White House Budget Proposal Targets Social Security Benefits

by Randall Luebke RMA, RFC on March 15, 2014

This is outrageous! Without getting into the politics or addressing the real problem government must solve (finding ways to run a government that can live within its means) the idea that people who have paid potentially hundreds of thousands of their earnings into the Social Security system should be unable to receive the benefits they were promised is somewhere between ridiculous and fraudulent.

Imagine a private business like an insurance company, for example, selling an annuity to the public to provide them with a guaranteed lifetime income. Essentially, this is what Social Security benefits are, annuities that provide a guaranteed income for life. Based on the terms and conditions promised the public contributed into that annuity plan for 20, 30, 40 years or more. After years of contributions, now it is time to start receiving the lifetime income benefits. Realizing that there were many options and choices available to them when taking their lifetime income many people sought professional advice to help them make the best choices and decisions based on their specific circumstances. However, simply because they sought advice from professionals who understand the details and intricacies of these plans, those that can help them maximize the benefits offered by these plans, the company retroactively changes the terms of the plan. Again, just because they want to maximize the benefits they were offered the terms and benefits are reduced! If any private company tried to do this there would a class action lawsuit and the plaintiffs would easily prevail.

Social Security is not optional. Everyone who earns wages in America must contribute. Today, in 2014, the contribution is 15.3% up to $117,000 of earnings or $17,901 a year. For anyone under the age of 50 this is more money they are allowed to contribute to their 401(k)! Again, think of this in the context of a private business that finds a way to legally compel the public into buying their annuity with no certainty that the terms of the annuity they are buying today would be guaranteed in the future. It simply would be illegal and it certainly would not be tolerated.

How can our "representatives" in government be so selfish, so short-sighted, so disconnected from reality to even propose such a thing?

Here is a link to the original article from Investment News – http://www.investmentnews.com/article/20140307/FREE/140309935#comment-1284588959

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