Public Policy of Social Security and Retirement Savings Essay

Social Security is on the verge of taking care of the baby boomers generation. This means that it will be paying more benefits than taxes it receives. In lay-man’s terms it means it will be spending more money than it is making. I think that you should pay into your own private retirement account for you to reap the benefits in the future. Not for you to pay into a cluster of workers money for current elders to benefit from. You need to take care of your own future and not rely on other people’s responsibility. â€Å"†¦people began to think retirement funding as a right†¦and so†¦started saving less† (Klay Steen). That being said, people of a certain age should be â€Å"grandfathered† into this meaning, people of the age of say 40, still get the†¦show more content†¦Back in 1950, as the baby boom was just getting started, each retirees benefit was divided among 16 workers. Taxes could be kept low. Today, that number has dropped to 3 .3 workers per retiree, and by 2025, it will reach--and remain at--about two workers per retiree (Social Security Reform Center – Problem). The number of workers for each beneficiary dropped from 5.1 in 1960 to 3.3 in 2006. This is expected to decrease to 2.1 by 2030 (Klay Steen). Baby boomers are going to retire and Social Security begins to spend more on paying benefits than it receives in taxes in 2017 or 2018 (Social Security Reform Center – Problem). This means Social Security will begin to handle very large funding problems because of the amount of people retiring and the worker/beneficiary ratio falling. This is caused by the increase of the payroll tax 17 times since 1935 (Epstein). Currently Social Security is not having any issues with payments. It lifts 1.3 million children and almost 13 million senior citizens out of poverty (Merino). The other side of the problem though is fairness. For example, you give someone $20 every month to save until the end of th e year for you, but until then they can lend out that money and use it how they want until the end of the year. At the end of the year you might have your money or someone else’s money. This problem reaches all aspects of American life and its people. It affects the taxShow MoreRelatedThe First Retirement Plan Of The United States1592 Words   |  7 PagesThe first retirement plan created in the United States, is one that the majority of us are familiar, the Social Security Act, signed under law in 1935. Up until 1939, Social Security only paid retirement benefits to primary workers, which for the most part were men. Age 65 was chosen as the retirement age because individuals who survived past childhood were likely to live past 65. However, not everyone benefited from such assistance, even after age 65—agricultural and domestic workers were excludedRead MoreEssay on Speech: IRA Retirement Plans931 Words   |  4 PagesSpeech: IRA Retirement Plans Saving for Retirement General Purpose: My general purpose is to persuade. Specific Purpose: My specific purpose is to persuade the audience to start saving for their retirement instead of simply relying on Social Security. Thematic Statement: Starting to save for retirement early has many benefits over Social Security. Introduction of Speech I. I took a survey of thirty BSU students, who are employed, to determine how many of them have started saving for theirRead MoreThe Problem With Social Security Trust Fund865 Words   |  4 PagesThe problem with Social Security trust fund is that at the present time there is more credit in the trust fund than is required for payment of Social Security benefits. â€Å"By 2027 revenue coming into the trust fund will fall below the level of being paid out, and by 2040 the trust fund will be depleted (Quadagno, 2014).†Meaning there will be not enough money from payroll taxes to pay all the benefits that are promised to citizens. This puts everyone who is going to enter retirement in jeopardy. EvenRead MorePension Reform Essay837 Words   |  4 PagesThe analysis of networks of Turkish pension reform is interesting for two reasons. The first reason is about the Turkish political context for the study of policy network. The second reason is the criticisms about the policy-making processes and the justifications of Turkish pension reform. Turkish political context for policy network approach Turkish political context is in a nutshell that state is everything. Turkish state exhibits a highly-centralized and interventionist characteristic. InRead MoreThe U.s. Economy Operates On A Fundamentally Capitalistic Reward Based Principle1236 Words   |  5 PagesWhen President Franklin Roosevelt signed the Social Security Act in 1935, this was exactly the concern he intended to address [1]. Specifically, as a result of having spent their prime working years fall within the Great Depression, many elderly citizens had not been able to accumulate enough savings to provide for themselves in retirement. As part of President Roosevelt’s New Deal to help America’s recovery from the Depression [2], the Social Security Act was introduced to â€Å"provide for the generalRead MoreFinance : Life Insurance Benefits1443 Words   |  6 PagesFinance: Life Insurance When I was young, I didn’t care about saving money, and I just spent it on food. As a college student, my uncle, who works for the World Financial Group, told me that I should start saving money for my college tuition and retirement. He suggested that I invest in life insurance to make more money instead of putting all of it in the bank. So, I decided to buy life insurance after I got a job to pay for it monthly. Despite the risk, the promise of earning one millionRead MoreThe Social Security Act Of 19351679 Words   |  7 PagesThe passing of the Social Security Act generated a social insurance program that protected a multiplicity of people by supplying a monthly benefit to societal individuals age 65 and older who were no longer actively working; it was a means of income to individuals once they retired and was based on the person’s payroll tax contribution (Martin Weaver, 2005). The longer amount of years a person was employed, the higher their benefi t amount is set to be. Social weighing was a method they used toRead MoreA Pension Policy For The Province Of Ontario1636 Words   |  7 PagesA pension policy for the province of Ontario is being discussed, in an attempt to make it more effective or being readily available. The existing issue is how it functions in low interests rates and low returns in equity markets. Also, the low participation in such plans is failing the system as a whole. It is important the government to protect workers in the private sector; as it is noted one-third of the paid workforce in 2005 was in a registered pension plan. Canada lacks when it comes to voluntaryRead MoreU.s. Labor Policy Proposal Essay3170 Words   |  13 Pages Labor Policy Proposal Presented by Institution Introduction Many people have no idea of what they expect to achieve after retirement when asked about their retirement plans. The government’s policies about retirement do not cater for the well-being of retirees creating a lot of worry for the life after employment. The increasing number of employees demanding cover by government pension programs and the current decline in the retirement income levels contributes to the change of theRead MoreSocial Security a Challenge to Public Finance1824 Words   |  7 PagesThe 1935 Franklin D. Roosevelt created the foundation for what today is Social Security. The bill entitled the Economic Security Bill and was the starting point for Social security. (ssa.gov) Social Security was enacted as part of the New Deal. Its purpose was to provide a safety net for the elderly and their direct survivors, as well, temporary unemployment benefits. The funding was a compulsory taxation of the employed workforce in shared responsibility with the employers (Hym an 2010 p. 312). The