Social Security

It’s good to look at our demographics to understand our Social Security liabilities and they seem to be in order. The “baby-boomers” seem to be tinning out and groupings of younger generations seem to be balanced.

 

US Population by Age

0-18 24%  

19-25 9%

26-34 12%

35-54 26%

55-64 13%

65+ 15%

 

https://www.kff.org/other/state-indicator/distribution-by-age/?currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D

 

The chart above should combine the 19-25 year olds with the 26-34 year olds and should read:

 

US Population by Age

0-18 24%

19-34 21% (combined)

35-54 26%

55-64 13%

65-100+ 15%

 

This gives us a better idea of the demographics that drive Social Security costs.  We have 24% children, 21% millennials, 26% GenXers and 28% retired or approaching retirement.

 

The shortfall is about income. The retirement age group earned a lot more money in a much better economy since 1945.  This was the best educated, most productive, most prosperous generation.

 

The GenX group survived, but too many made too little.  The millennials really suffered with minimum wage jobs. The childrens’ group will probably earn more than the millennials.    

 

Many US citizens work past age 65, especially if they are self-employed. 50% of Americans are “healthy” at all ages and this group could work until age 70 easily. Some Social Security recipients signed up at age 62. Most signed up at age 66. Many die before age 66, but half of their Social Security goes to their surviving spouses.

 

Previous fixes to Social Security came from raising the eligibility age from 65 to 66 and raising the wage cap to $128.400. Both of these could be raised. Social Security can be reform is already in the law.

 

Currently, the full benefit age is 66 years and 2 months for people born in 1955, and it will gradually rise to 67 for those born in 1960 or later. Early retirement benefits will continue to be available at age 62, but they will be reduced more. Even Greece is raising the eligibility age for their retirement pension to age 67.

 

The real problem with Social Security is that is a Ponzi scheme and a “defined benefit” plan. It would have been better if the law had authorized individually owned accounts that beneficiaries could have invested.

 

Before Social Security, the elderly simply lived with their kids.  Now the kids live with the elderly.

Norb Leahy, Dunwoody GA Tea Party Leader