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Wednesday, March 26, 2008
Do you count on Social Security?
The Atlanta Journal-Constitution
The warnings continue from the trustees of Social Security and Medicare. Both are headed toward insolvency. No surprise. It’s an annual assessment and Congress has chosen to do nothing to fix the problem, despite the looming retirement of 78 million baby boomers.
Trustees reported Tuesday that Medicare will pay out more this year than the feds collect in payroll taxes; the same will happen to Social Security in 2017. By 2019, Medicare will deplete its so-called “trust funds” and the same will happen to Social Security in 2041.
Treasury Secretary Henry Paulson predicts a train wreck. “Without change, rising costs will drive government spending to unprecedented levels,” he said, “consume nearly all projected federal reserves and threaten America’s future prosperity.”
President Bush certainly did his part. He vowed to make Social Security overhaul a top priority of his second term and did propose retirement savings accounts, which would have allowed the young to sock away a portion of their payroll taxes into a fund they could own and pass along to their heirs. Democrats in Congress would have no part of that — and they’re reinforced in their opposition by those who see the stock market as a frightening place associated with the dreaded “risk.”
As one of those 78 million baby boomers, I don’t expect Social Security to be a major factor in my retirement years. It was not in the planning for retirement, largely because Congress can change benefits or raise the retirement age at any time it chooses. Or, just as bad, it will raise benefits not because the elderly population is the neediest, but because it votes. The dependence on government and on politicians that is the basis of Social Security has long caused me to look for an alternative.
The question of the day is how much Social Security factors into your retirement planning and whether, given the choice, you’d opt out?
