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Social Security Administration

The Social Security Administration (SSA) is an independent agency of the United States federal government that administers Social Security, a social insurance program consisting of retirement, disability, and survivors' benefits. To qualify for these benefits, most American workers pay Social Security taxes on their earnings; future benefits are based on the employees' contributions. (Source: Wikipedia)

Perhaps you are working for the SSA or interested in working for the SSA. Here is a forum to share your experience with the SSA.

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jca245  
#1 Posted : Sunday, February 19, 2012 11:27:04 PM(UTC)
jca245

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Hello all-

 

I am a bit confused by the news information I have been hearing about the condition of the SSA. I was hoping that someone who actually worked in the agency could explain the reports (rumor’s?) that the current SS account is set up to become broke by 2018.

 

This directly concerns me and others like me as we have mandatory retirement at age 57 from the BOP under the Law enforcement / firefighter’s policy. Part of my pension includes a supplement of $700, (more than 1/3 of my gross) that is eliminated when I turn 62 and it is expected that will apply for SS payment’s which will replace that supplement. I am 58 now, so this change will take place for me in 2018.

Based on the news I have been hearing, and if this is factual, I and other people like me can expect to collect for 2 more year’s and then have what is left to live on.

 

I do not want to sound like I am whining about my bad luck. Lord knows there are people out there that have it much worse than me and I feel bad about this whole mess that caused this. However since this is close to home, I am concerned about the effect this particular incident will have on my family.

 

Thank you all and hang in there.

jca2452012-02-20 07:38:52
jca245  
#2 Posted : Sunday, February 19, 2012 11:29:17 PM(UTC)
jca245

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Sorry for the 1018 title. Should have been 2018. I was distracted and missed a key.
early senility I guess LOL
I edited the title and corrected it. jca2452012-02-20 07:39:15
rabbitdog99  
#3 Posted : Monday, February 20, 2012 12:05:10 AM(UTC)
rabbitdog99

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I don't work for the agency but here's how I see it.  You'll be fine.  In the future, adjustments will have to be made in the S.S. system to keep it healthy.  It's all numbers.  They have all the actuary tables they need to
calculate how long you are going to live and how much you should contribute (invest) to be able to begin drawing a certain amount on a certain date.  They've been making adjustment along the way since the beginning.  If S.S. is in trouble it can only be because of miss-management.  I did some calculations on my contributions with some conservative assumptions.  I
assumed a 5% return on money I put in and also a 5% a year increase in the benefits once I started collecting(that will never happen).  Based on this, my account should last until I'm 82.  Plus I have some close friends
who have paid into the system and died shortly before or after they could collect.  So if I am fortunate enough to live past 82 I will be able to use whatever my friends had put in.  So you see, the money should be there unless it's been miss-managed; and if it has been there is still time to fix it.


chrisocasio  
#4 Posted : Monday, February 20, 2012 12:20:08 AM(UTC)
chrisocasio

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Rabbit, you seem to be assuming that Social Security is a system of individual accounts. In fact, it is a large pool of money disbursed almost without regard for what you, as an individual, contributed to it. Additionally, the money is not invested per se, and the parts that are invested are used to buy US Treasury notes from the government. In essence, the SS fund has been loaning money to the government in exchange for a small rate of return and a promise to pay back the SS fund in the future when those notes come due.
 
As far as keeping SS healthy, or in the black at least, you're correct. In the future, because of earlier retirements and longer lasting retirements, there will not be enough money to pay the full ammount of monies promised to SS retirees. Unless, of course, something changes as you alluded to. An increase in the ammount of money eligible for SS taxation (its currently only your first ~100,000 of earnings), an increase in the retirement age, an adjustment to COLA, or a decrease in benefits would all help alleviate the problem.
Big Sarge  
#5 Posted : Monday, February 20, 2012 1:58:29 AM(UTC)
Big Sarge

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I don't think you have anything to worry about as the longest standing ponzi scheme ever will remain in effect for years to come.  As younger generations of workers continue to pay into it, current beneficiaries will get their payments.
MFTECFH (Members for the Elimination of Corruption in Federal Hiring)
Fed1969  
#6 Posted : Monday, February 20, 2012 2:26:37 AM(UTC)
Fed1969

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Where are you getting the 2018  date?  The last I heard we were good for another 20+ years.  This was from Social Security

Of course with the payroll tax cut, things were made things worse.
dhacker56  
#7 Posted : Monday, February 20, 2012 2:30:20 AM(UTC)
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SS has NO funds in a trust fund.  It is paid out of the current taxes.  

Big Sarge  
#8 Posted : Monday, February 20, 2012 4:08:39 AM(UTC)
Big Sarge

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dhacker56 wrote:
SS has NO funds in a trust fund.  It is paid out of the current taxes.  

 
Exactly...rob Peter to pay Paul.
MFTECFH (Members for the Elimination of Corruption in Federal Hiring)
Fed1969  
#9 Posted : Monday, February 20, 2012 4:22:47 AM(UTC)
Fed1969

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Social Security has government IOUs.  At the projected payout, the government will have repaid in 20+ years.  No cash supports the IOUs.  So as Big Sarge said this iw "rob Peter to pay Paul."
orson  
#10 Posted : Tuesday, February 21, 2012 5:35:22 AM(UTC)
orson

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Hi jca245,
 
I think there's some confusion over the question, "SS going broke in 2018??".  You picked the year 2018, because that's when you will turn 62 -- right?.  Social Security retirement benefits will still be available in 2018 (and for many years thereafter); and you will most likely find that the age 62 Soc.Sec. retirement payment will be more than the FERS supplement you have been getting from OPM.  
 
With regard to the issue of Social Security's solvency, the SSA website explains:  "The last 5 Trustees Reports have indicated that Social Security's Old-Age, Survivors, and Disability Insurance (OASDI) Trust Funds would become exhausted between 2036 and 2041 under the intermediate set of economic and demographic assumptions provided in each report. If no legislative change is enacted, scheduled tax revenues will be sufficient to pay only about three fourths of the scheduled benefits after trust fund exhaustion. Many policymakers have developed proposals and options to address this long-range solvency problem."
 
Sure, Social Security's detractors like to call it a Ponzi scheme (remember Rick Perry?); but it has provided essential income to millions of people since 1940.  Some changes will have to be made to Social Security to insure it's long-term solvency, but the odds are it will outlive you and me. 
Fed1969  
#11 Posted : Tuesday, February 21, 2012 11:28:50 AM(UTC)
Fed1969

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If congress were to raise the amount people pay the payroll tax to unlimited, this would extent Social Security benefits for many years.
Big Sarge  
#12 Posted : Tuesday, February 21, 2012 11:51:18 AM(UTC)
Big Sarge

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Fed1969 wrote:
If congress were to raise the amount people pay the payroll tax to unlimited, this would extent Social Security benefits for many years.
 
Which means eternal slavery in America. 
MFTECFH (Members for the Elimination of Corruption in Federal Hiring)
Angel1955  
#13 Posted : Tuesday, February 21, 2012 6:46:35 PM(UTC)
Angel1955

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A lot of politicians use this scare tactic - - being in finance for many years - I even look at GROUPS that put out   info. re: many are covers for "brain tactics" - I don't go by what a politician says he believes in - if really interested I track down Roberts Roll to see how he/she voted - -as you see I am a pragmatic -
Fed1969  
#14 Posted : Tuesday, February 21, 2012 8:51:39 PM(UTC)
Fed1969

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Politicians will say what they think you want to hear, and then do little or nothing.
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