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OK, I alluded earlier to my finance background so I decided to put into type something I have done for friends many many times.
If you came to me at age 18 and said "I want to put 12.8% of my earnings into a retirement account taken out of my check at the end of each month. What can I do at age 65" it would be almost identical to social security.
Lets be VERY MODEST in our assumptions so there is NO POSSIBLE way anyone can accuse me of being unrealistic in my calculations.
Lets say you earn EXACTLY 20k every year (for simplicity, and I hope most of you earn more than that especially as an average).
Lets say you earn 5% on your money every year (will calculate the same as if you average 5%)
I choose this number cuz that allows you to carry peoples mortgages (at a great deal to them no less) use bank CD's, you know, the absolute safest investments known to mankind. This is a number that is unrealistically low, if any financial advisor tells you to expect 5% with him, fire him and find someone else.
OK on to the answer.
At age 65 you would have $484,000 (your money, not the gov'ts)
If you continue to earn a whopping 5% how much and how long can you draw?
If you live to be 100 you can draw $2442 per month without going broke.
This is the system that our government can't seem to manage. People earning 20k will NOT get 2442 a month and will not be able to leave money to their kids if they die before 100. LBJ raided the social security trust fund and every congress since simply puts the money in the budget and moves on. Now I ask you....are these the people you want in charge of your health care? I'll also ask you...doesn't bush's privatizing social security sound pretty good all of a sudden?
sidenote: if we change to 6% (still VERY low) it becomes
670,000 and withdrawal of 3820 a month, and if you only live to 95 you can withdraw over 4000 a month. See, the numbers get silly fast, and i'm still not even close to reasonable expectations.
If you came to me at age 18 and said "I want to put 12.8% of my earnings into a retirement account taken out of my check at the end of each month. What can I do at age 65" it would be almost identical to social security.
Lets be VERY MODEST in our assumptions so there is NO POSSIBLE way anyone can accuse me of being unrealistic in my calculations.
Lets say you earn EXACTLY 20k every year (for simplicity, and I hope most of you earn more than that especially as an average).
Lets say you earn 5% on your money every year (will calculate the same as if you average 5%)
I choose this number cuz that allows you to carry peoples mortgages (at a great deal to them no less) use bank CD's, you know, the absolute safest investments known to mankind. This is a number that is unrealistically low, if any financial advisor tells you to expect 5% with him, fire him and find someone else.
OK on to the answer.
At age 65 you would have $484,000 (your money, not the gov'ts)
If you continue to earn a whopping 5% how much and how long can you draw?
If you live to be 100 you can draw $2442 per month without going broke.
This is the system that our government can't seem to manage. People earning 20k will NOT get 2442 a month and will not be able to leave money to their kids if they die before 100. LBJ raided the social security trust fund and every congress since simply puts the money in the budget and moves on. Now I ask you....are these the people you want in charge of your health care? I'll also ask you...doesn't bush's privatizing social security sound pretty good all of a sudden?
sidenote: if we change to 6% (still VERY low) it becomes
670,000 and withdrawal of 3820 a month, and if you only live to 95 you can withdraw over 4000 a month. See, the numbers get silly fast, and i'm still not even close to reasonable expectations.
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