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872 sats \ 11 replies \ @DEADBEEF 8 Feb \ on: The Future of Social Security econ
Social security is basically a pyramid scheme. It was built on the premise that each generation would have more people paying in. Birth rates have totally collapsed over the last few decades. Also the retirement age barely changed to match life expectancy. When first passed the average life expectancy was about 65 - the same age as retirement.
The most likely outcome is that the age of eligibility will be gradually raised. So that means retirement should be raised to about 78 based off the current average life expectancy.
It was built on the premise that each generation would have more people paying in.
and the lie that each generation was only taking out what they had already paid in.
They run into an interesting problem raising the age, though: it basically becomes a retirement fund for white people, given discrepancies in lifespan.
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Who wants to work past age 65 regardless of social security eligibility!!!
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You're allowed to retire before you withdraw social security. It's not unreasonable to think someone might not be destitute the moment they quit working.
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You can tap into your IRA and 401k starting at age 59.5
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You can actually borrow from them before that, as I understand it.
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I think it's penalty free for 60 days per calendar year
otherwise, the penalties are steep (10 percent plus income tax on the amount borrowed)
My cousin dealt with something similar a few months ago, avoided penalty after borrowing from IRA/401k
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Good point… so many seniors are destitute though especially in nursing homes
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Medicaid covers nursing homes, but I agree that it's a sad situation.
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Medicaid is a badge of poverty
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