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OT SS going to the source



 
 
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  #21  
Old January 7th 05, 10:17 PM
Brenda
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No problem. I knew when I wrote it I wasn't saying it the way I meant
but was a bit foggy at the time (DH put Return of the King into the DVD
player after 10 last night and I'm a credidiot...). I didn't mean
privatizing, but the creation of personal accounts.

While changing won't be mandatory, you know people who really don't even
understand how simple interest works will be under a lot of pressure to
change. The government may only approve a few investments but crooks
will count on people being unaware of this or they will charge people
for an "information kit" to tell them the same stuff the government
could tell them for free. Think of all the additional junk mail, SPAM,
and trash faxes...

In any case, since I no longer contribute to the system I'm only
interested in a guaranteed return with essentially no risk.

JiminyCricket wrote:
Great discussion of human behavior and some of the ongoing studies -- but...
the policy discussion ISN'T about PRIVATIZING SOCIAL SECURITY, it's about
allowing people under some age limit (current talk is 50 yrs old) invest
some portion (current talk is less than 10%) of their SS contribution into
federally approved investment vehicles (a limited number of these too). It
wouldn't be mandatory -- so you wouldn't be forced to change from the
current scheme if you didn't want to.

(not arguing with Brenda -- just trying to add some clarity)


--
Brenda
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  #22  
Old January 7th 05, 11:20 PM
Dianne Lewandowski
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I have been threatening (because of so many conversations here on RCTN)
to start writing down the companies involved in fraud as I read about
them. It goes back before Enron to Cendant (one at Cendant got hung,
the other a hung jury). There is hardly a month that goes by that
another bank, fund, broker, corporate giant, isn't being investigated or
charged. Many end up settling and it never gets to trial.

And the general "you" wants me to invest for my future???? Is there
anyplace one can trust, anymore? Certainly not my government, which
raided social security.

Dianne - with a wink/wink, grin.

escape wrote:

I don't know about get rich schemes, but even if people buy shares in stock
which has performed beautifully over the decades, this money will result in many
broker fees associated with making a stock purchase. The discount houses like
Fidelity and such are frothing at the mouth for this privatization. Many
companies which are on the cusp now will be deep into overvalued after this
percentage of SS funds are put into the private sector. Hey, I hope I'm wrong.


  #23  
Old January 8th 05, 12:24 AM
Ericka Kammerer
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JiminyCricket wrote:

Great discussion of human behavior and some of the ongoing studies -- but...
the policy discussion ISN'T about PRIVATIZING SOCIAL SECURITY, it's about
allowing people under some age limit (current talk is 50 yrs old) invest
some portion (current talk is less than 10%) of their SS contribution into
federally approved investment vehicles (a limited number of these too). It
wouldn't be mandatory -- so you wouldn't be forced to change from the
current scheme if you didn't want to.


Ahhh, but SS benefits will be reduced in all these plans--
that's the whole point--including reductions for those who do
not use the personal investment accounts. So, whatever percentage
is available for the personal account, it increases the overall
risk. It may also increase the return...but it may not, hence
the risk.

Best wishes,
Ericka

  #24  
Old January 8th 05, 12:46 AM
Dr. Brat
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Cheryl Isaak wrote:
On 1/7/05 2:19 PM, in article
, "K"
wrote:


That's my primary reason for not believing in privatization of Social
Security, that people won't make good decisions about the investment. In
addition to the time and sophistication required, how is someone who is
worried about putting food on the table tomorrow going to make reasoned
judgments of how to invest money to ensure there is food on the table 30
years from now?

The scam artists, the governmental lack of responsibility, and the false
growth of the economy are all others. Just a bad idea all around as far
as I'm concerned.


But is the government making decisions that are any better?


If my understanding of how Social Security works is correct, that
question is irrelevant.

Elizabeth
--
*~*~*~*~*~*~*~*~*~*~living well is the best revenge~*~*~*~*~*~*~*~*~*
The most important thing one woman can do for another is to illuminate
and expand her sense of actual possibilities. --Adrienne Rich
*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~*~ *~*~*~*~*~*~*~*~*~*
  #25  
Old January 8th 05, 07:20 AM
Karen C - California
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In article , Brenda
writes:

While changing won't be mandatory, you know people who really don't even
understand how simple interest works will be under a lot of pressure to
change.


Yep. And if they're working with a stockbroker who gets paid for every trade,
the naive may end up broke. Mom's neighbor didn't understand the market the
way her late husband did, so she signed something giving the broker the right
to make any trade that he deemed acceptable, thinking he'd make better
decisions than she could. He apparently made a trade every half-hour until
most of her account had been drained by those per-trade fees.

When we got a 401k plan, the company brought in a financial advisor who met
with each of us individually. The less-sophisticated were steered toward the
guaranteed interest fund (at that time, paying much less than the skyrocketing
stock funds, but they have not lost a cent of their principal, which some of
the stock funds did). To get into the riskier emerging markets fund, I had to
discuss international politics and international economics to prove I
understood what I was doing. If only all financial advisors were that honest.

--
Finished 12/8/04 -- Army bear ornament
WIP: Fireman's Prayer (#2), Amid Amish Life, Angel of Autumn, Calif Sampler,
Holiday Snowglobe

Paralegal - Writer - Editor - Researcher
http://hometown.aol.com/kmc528/KMC.html
  #26  
Old January 8th 05, 02:46 PM
Cheryl Isaak
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On 1/7/05 6:46 PM, in article
, "Dr. Brat"
wrote:

Cheryl Isaak wrote:
On 1/7/05 2:19 PM, in article
, "K"
wrote:


That's my primary reason for not believing in privatization of Social
Security, that people won't make good decisions about the investment. In
addition to the time and sophistication required, how is someone who is
worried about putting food on the table tomorrow going to make reasoned
judgments of how to invest money to ensure there is food on the table 30
years from now?

The scam artists, the governmental lack of responsibility, and the false
growth of the economy are all others. Just a bad idea all around as far
as I'm concerned.


But is the government making decisions that are any better?


If my understanding of how Social Security works is correct, that
question is irrelevant.

Elizabeth


The interest on all that money has to come from somewhere.

Cheryl

  #27  
Old January 8th 05, 02:53 PM
Cheryl Isaak
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On 1/8/05 1:20 AM, in article ,
"Karen C - California" wrote:

In article , Brenda
writes:

While changing won't be mandatory, you know people who really don't even
understand how simple interest works will be under a lot of pressure to
change.


Yep. And if they're working with a stockbroker who gets paid for every trade,
the naive may end up broke. Mom's neighbor didn't understand the market the
way her late husband did, so she signed something giving the broker the right
to make any trade that he deemed acceptable, thinking he'd make better
decisions than she could. He apparently made a trade every half-hour until
most of her account had been drained by those per-trade fees.

When we got a 401k plan, the company brought in a financial advisor who met
with each of us individually. The less-sophisticated were steered toward the
guaranteed interest fund (at that time, paying much less than the skyrocketing
stock funds, but they have not lost a cent of their principal, which some of
the stock funds did). To get into the riskier emerging markets fund, I had to
discuss international politics and international economics to prove I
understood what I was doing. If only all financial advisors were that honest.



Do you remember which "firm" handled that? Sounds a lot like the people
Raytheon had in to speak to the exempt employees in their first year of
employment. Excellent descriptions of how to invest, when to change your
game plan, etc. I think it was AG Edwards. We didn't get full company
pension benefits until the 10th year.

The hourly (different from the union) employees accrued pension benefits
after 12 months and hourly got the 401k option after 5 years.

I suspect both were ways of keeping people at Raytheon - engineering
turnover was horrific, hourly not quite as bad.

Cheryl

  #28  
Old January 8th 05, 04:06 PM
Barbara Hass
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Gary V. Deutschmann, Sr. wrote:

Hi Barbara

Perhaps I should post some FACTS concerning Social Security, since
there are so many MISCONCEPTIONS about it floating around.


ORIGINALLY: Social Security WAS just a retirement program under 1935
Law.


But it still started out paying retirement benefits to people who had
never paid into the system, correct?

Social Security was designed to be totally self-supporting.
At the time of inception, it was estimated that by 1980 there would be
over 47 Billion Dollars in Reserve Funds. They reached this Goal 6
years faster than expected, in 1974 they were well ahead of schedule.


Interesting, did not know that.

However, the government dipped into these reserves reducing them to
ONLY 26 billion in 1980, they also lost the 6.9% current interest they
would have earned on that money.


And why don't I trust the gov't with my money?

TODAY 2005: The Social Security Reserve Fund is Over 1 Trillion
Dollars.

From 1937 to 2002:
The SSA has taken in 8.7 Trillion Dollars.
They have only paid back out 7.4 Trillion Dollars.


But according to my most recent mailing from SSA they are estimating
running out of money before I reach retirement age. Even if that's not
the case, I still wouldn't mind having the option to invest some of that
money on my own.

Thanks for the figures,
Barbara

  #30  
Old January 8th 05, 04:25 PM
Barbara Hass
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More info:

http://www.ssa.gov/qa.htm

In summary, I was incorrect in that I might receive *something* by the
time I retire. However, current retirees/near-retirees are receiving
benefits at the same rate/increase with inflation, with no current plans
to decrease benefits for those people. (Which would be a bad move from
a political standpoint - this is a huge % of voters). Yet by the time I
retire, my benefits will start out reduced minimum 27% of current
benefits and decreasing, if there are no changes to the program. Which
I am projecting will probably translate to very little money, definitely
nothing near what will be required for retirement. According to the
last question, other countries are prefunding and establishing versions
of personal accounts in order to ensure future benefits.

I guess no matter what investing money is risky. Something could always
happen to shake up the economy, change interest rates, whatever that
would affect any investment, whether SS fund or private. But I'd like
the option of something a little better, like a mutual fund, than a
retirement plan that's a guaranteed (at this time) to lose money.

Barbara

 




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