Retirement and Social Security


If you make any money, the government shoves you in the creek once a year with it in your pockets, and all that don’t get wet you can keep.  Will Rogers
This week my students are discussing retirement planning, and noted in their textbook that the Social Security trust fund will be depleted by 2044.
Last year the Social Security and Medicare Boards of Trustees projected that the theoretical combined OASDI trust funds will be depleted in 2033 (see table below).  OASI is Old Age and Survivors Insurance and DI is Social Security Disability Insurance.  Other components are Medicare Hospital Insurance (HI) and Supplementary Medical Insurance (SMI). [1]
According to the projection, even after depletion continuing tax income would be sufficient to pay 77 percent of scheduled benefits in 2033 and 72 percent in 2088.  Though I do not expect to ring in 2088 and may not even see 2033, some of you, my children and grandchildren may experience both!
The textbook further notes: “ . . . the government is somehow going to have to come up with the funds to make good on its pile of IOUs to the Social Security trust fund.”
Allen W. Smith, Ph.D. (Ball State and IU grad) stated that “The government has embezzled all surplus Social Security revenue, generated by the 1983 payroll tax hike, and spent the money on wars and other government programs. None of the money was saved or invested in anything.” [2].
At the end of calendar year 2014 our national debt was more than $18 trillion ($18,141,444,135,563) and has grown more than $10 billion by the end of March 2015.
Last fiscal year (October 2013 – September 2014) the interest expense aloneon our national debt was $430.8 billion ($430,812,121,372), enough to put $113.56 of food, every month, on the table in front of every man, woman, and child in America.
With $18 trillion in debt and no budget at all – let alone a balanced one – it is unrealistic to believ
e that our federal politicians will work hard to hold themselves to unsustainable promises made decades ago by their predecessors.  After all, to remain in office they’ve made too many of their own.

Financial projections are never simple, but considering that a congressional representative needs to think no further then the next election we might just as well roll the dice.  Whether from “borrowing” or “embezzling”, it’s clear that there is no pile of OPM that is safe from politicians.

Rely on nothingfrom government.



 [1] Source: Social Security and Medicare Boards of Trustees, Summary of The 2014 Social Security and Medicare  Annual Reports <> accessed 12/09/2014
[2] Source: <> accessed 12/10/2014

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