The Social Security Windfall Elimination Provision unduly penalizes many in the teaching and public service professions who also worked other jobs and contributed to Social Security.
Please support the efforts to dispose of the WEP:
Support the Social Security Fairness Act.
H.R.82 - Social Security Fairness Act of 2023.
The Act eliminates the financial penalties to Teachers and First Responders.
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Letās replace the whole system and replace it with something besides a ponzi scheme.
Good idea but first letās give the money to those who contributed. Support the Social Security Fairness Act.
Whatever we do, it has to transition steadily but slowly, so people who are in retirement or quite close to retirement donāt get majorly screwed because they donāt have enough time to adjust to the new plan. I think probably everyone can agree on that.
Iāve never liked the regressive nature of the SS tax. It has to at least be made flat for all earners.
There are a number of terrifyingly wonkish but very important question to consider in transitioning to a Sovereign Wealth Fund based on corporate stocks and bonds.
The easy, reflexive answer is just āmake it follow the S&P500 indexā. Right? Well, because that index is market capitalization weighted, that means the index blindly ābuysā whatever just went up in price. The S&P500 index does not follow how valuable companies are by any intrinsic measures. If the market is in a bubble or mania, the S&P500 faithfully follows the herd.
So now, the S&P500ās great performance in 2023 is only due to the Magnificent Seven. 493 of the stocks have been flat or down as a groupā¦ the Mag Seven thoughā¦
This is the same thing that happened in the late 1960s, with the Nifty Fifty. Those were stocks that you supposedly only had to buy and never sell. They were lifetime decisions. Hereās what our friend Wikipedia has to say about that:
The long bear market of the 1970s which began with the 1973ā74 stock market crash and lasted until 1982 caused valuations of the nifty fifty to fall to low levels along with the rest of the market, with most of these stocks under-performing the broader market averages. A notable exception was Wal-Mart, the best performing stock on the list, with a 29.65% compounded annualized return over a 29-year period.[1] However, Wal-Martās initial public offering was in 1970 and only started trading on the NYSE on August 25, 1972,[4] at the end of the bull market.[5]
Because of the under-performance of most of the nifty fifty list, it is often cited as an example of unrealistic investor expectations for growth stocks.
Also did you know that inclusion into the S&P500 list is ultimately decided by a COMMITTEE? Can you imagine the amount of additional bribery and influence peddling that would go on for a company that might go from 501 to 500? That happens alreadyā¦ it would be magnified intensely if the S&P500 or any committee-based index were to become the backbone of a Social Security replacement / USA Sovereign Wealth Fund.
But we have to do something. The current system is imploding because of demographics. Iām actually banking on the 23% fall in benefits in 2034, as reported by the Social Security Trustees. Itās in my budget. If it does not happenā¦ it will be a nice surprise.
My thought has been that part of peoples fund should be in bonds and partly where the person could choose certain approved investments.
No matter what is decided it will never meet everyones idea of what is best. We like to think that our politicians are honest but most seem to be controlled by outside groups in order to get elected or re-elected. This is why there needs to be solutions which the politicians donāt have input for.
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My Mother was in the first group to receive Social Security. She always complained that they were cheated based upon the formula used for people the first few years. She called herself a āHump Babyā. Seems in 1940 there were a number (very many) recalculations and decisions which changed the payouts. She never recovered the money she should have received (all according to her).
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The everyone screwing has only started. The way I think this will end is the way it always endsā¦ the problem will be covered with more debt, but as we see now, the debt service will become a huger and huger part of the budget. The government will have to pay the debt, so they will make sure they pay it nominally, but in real terms they wonāt. They will let inflation run hotter than interest rates - a financial repression regime, like after WW2.
This will cause real assets like gold to increase in value relative to the US Dollar. Gold has been terrible since Aug 2020, and gold miners even worse, but itās maybe moving now. I started buying 8 years ago, and it has about doubledā¦ 9% annualized return. Thatās OK. I didnāt buy it in 2000 or whenever it was really low, but since that low is has gone up about 10% per year annualized. Thatās actually decent, itās not correlated to stocks so it makes a good diversifier, but goldās problem is it tends to fall asleep for long periods of time which outlast most peopleās patience.
I have 13% of my portfolio is gold because I honestly donāt see how the US escapes its debt w/o negative real interest rates and a loss of confidence in the Dollar.
Women tend to be among the āmore-screwed.ā Not invariably, but more frequently/numerously in the groups that are. And it isnāt just their benefit that is affected, it is also suurvivor benefits to which they may be entitled.
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For reference:
I agree - teachers get cheated.
It will take calls to Senators and Reps of both parties. Iāve contacted my Senator and intend to continue to pursue.
It does not seem to be a partisan issue either way, which is good.
āthe squeaky wheel gets oiledā
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My wife worked as a teacher for 20 years or so in multiple states. As it turned out, she lost money in the different retirement schemes and gets more with 50% of my SS benefits that she would have with hers.
150% of mine crested $55K a year in 2022.
Hereās our strategy for solving the SS crisisā¦ encourage participants to āpassā early. Didnāt Charles Dickens have a phrase for that in "A Christmas Carol? ādecrease the surplus populationā?
(Washington Post, 12/28/23)
The commissioner of the Food and Drug Administration had an urgent message last winter for his colleagues, brandishing data that life expectancy in the United States had fallen again ā the biggest two-year decline in a century.
Robert Califfās warning, summarized by three people with knowledge of the conversations, boiled down to this:
Americansā life expectancy is going the wrong way. Weāre the top health officials in the country. If we donāt fix this, who will?
A year after Califfās dire warnings, Americansā life expectancy decline remains a pressing public health problem ā but not a political priority.
President Biden has not mentioned it in his remarks, according to a review of public statements; his Republican challengers have scarcely invoked it, either. In a survey of all 100 sitting senators, fewer than half acknowledged it was a public health problem. While recent federal data suggests that in 2022, a partial rebound from the ravages of the coronavirus pandemic, no national strategy exists to reverse a years-long slide that has left the United States trailing peers, such as Canada and Germany, and rivals, such as China.
Itās not a heath problem, itās a political phenomena.
My social security is $x ; my husbandās would be $y. Which is more than twice mine. So a spousal benefit would add that extra bit to mine to maje it half of his. As his widow, i receive mine plus the amount he had eatned to equal his amount.
My best friend is a retired teacher with a pension less than my social security amount, and some social security from other jobs that she is waiting to hopefully collect something from after she turns 70. I doubt she will get much. Her late husband would have had a decent social security pension, but since it isnāt more than 2/3rd her teacher pension, she is not eligible to collect any of it, either as a spouse or as a survivor. A spouse who had never worked would be eligible for half of it, or all of it as a survivor.
That varies by state, in some states you do, in others you donāt.
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Social Security should never have been or should be looked at as an investment. It was never the intention.
Thank you billnin. I should have used the word ācontributionā instead of āinvestmentā. Their contributions are being unfairly denied.
What young adult thinks about social security or retirement? Very few. My point is that she is penalized far more than would be someone with a lower social security benefit, which is basically the deceasedās benefit minus oneās own. Versus the deceasedās minus 2x oneās own. Yes she has to pinch pennies very much more than she should have toā¦not sure how much if any it might have changed her choice to be a special ed teacherā¦we have another friendā¦her friend since early childhood, mine since she introduced us in college who taught in a different state, and will receive social security. The WEP and GPO penalties should not be for low to average wage earners, but if at all, only for high wage earners.
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Where you are wrong is that most teachers have other jobs that do pay into SS, either before, after, or during their teaching career. My own contributions were forfeited when I retired. If a teacher collects SS, it is moderated in amount because of the pension that each and every one of us had SUBTRACTED FROM OUR PAY MONTHLY by the retirement association/ school district without a choice. This is in addition to the cruddy high cost 403b plan I can contribute to instead of a 401k that is available to most other workers. It seems like you have a grudge against teachers.
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I think the main problem is that too may people look at SS as a retirement/investment/benefit program and shouldnāt be. Even looking at the WEP reference I provided above the SSA itself refers to SS as a tax.
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