Why do we need social security?

[michel]

Why do we need it? I mean the fund that are put into the social security fund do not gain any real interest. You could put the money in a drawer for 50 years and it would be worth as much as if you put it into social security. The system in built on the hope that the next generation will be bigger than the last which makes it very similar to a Ponzi scheme. Eventually it will collapse if our population growth goes negative or near negative like Europe. I mean it helps old people now but what about the people in the future. The fund is already out of money and has been going into negative territory since 2011. Do we just pray it holds up until we are dead and say fuck future Americans?

[Vito1964]

You should really look up what Social Security is because what you described isn't even close.

[oikoσ]

You are right that SS is similar to a Ponzi scheme. However, it would work if Congress could keep its cotton-picking hands off the fund. Instead, they regard it as a source for pet projects that are not in the budget.

The trouble is that we can't afford to stop it. Bush's brilliant idea to allow people to invest the money that would have been taken out in the stock market would have dried up the supply for us old fogies who depend on it for our daily expenses. Further, a stock market crash would have wiped out the retirement funds for the next batch of retirees. We can thank Bush for that too.

Yes, SS does not draw much interest. Neither does my savings account. What you have to do is to plan on a mix of places to put your money. When you are young, you can afford to gamble a bit on high-risk investments. As you age, you need to switch to more conservative stocks and bonds. A tip for you, bought with a big chunk of my retirement funds: when your broker recommends a stock that his firm is pushing, run the other way. On the other hand, my investment in a utility stock (conservative and well-managed) was enough to let me buy a house and mini-farm a few years later.

[icpooreman]

Its not a ponzi scheme. The next genration doesn't have to be bigger we just need more people paying in than taking out.

Eg there needs to be more 16-65 year olds than there are people 65+. If it gets out of whack due to a big generation we just up the age or slightly cut benefits. So now its 67+ and boom we can still afford it. Or we up the social security tax a couple percent.

We need social security because its inhumane to let the elderly live in extreme forms of poverty. If you are 70-90 you likely can't work to support yourself any longer. So the choices are fall back on savings, or relatives or if you don't have those live in extreme poverty until you die. Kind of sad. It benefits others as well. My parents didn't have to spend all their money supporting my grandmother when I was a kid and so I got more opportunities than I might have had.