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11 Ways Your Social Security Benefit Calculation Can Shortchange You

Thursday, January 9, 2014 - 8:44 AM
From Forbes: 
Social Security is very generous—to some people. It is delivering a handsome return on investment to the generation that is now retired. It gives a bonus to workers who get married more than once. It’s kind to the low-paid. That means certain other people don’t do so well. Here are some ways that you can wind up with the short end of the stick.

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pearlbrownpearlbrown1,491 posts since
Nov 2, 2010
Rep Points: 6,486
1. Thursday, January 9, 2014 - 9:26 AM
Although the Social Security system may pay higher benefits to people who get married, than people who don't, this is really nothing new. The U.S. Federal Individual Income Tax system has always punished singles when filing, with lower deductions and less exemptions.

Also the article in Forbes claims Social Security is a "Ponzi scheme". Not true.

"A Ponzi scheme requires ever expanding number of participants with the current participants being paid from new members of the scheme. The deal is that people are getting paid far more back than what they paid in. In fact, participants in [Social Security] get a real return that averages around 2.0 percent. It is close to being sustainable for the infinite future. The projected shortfall is equal to a bit more than 10 percent of the programs costs (by the CBO projections -- the [Social Security] trustees have a somewhat higher figure). With a relatively modest tax increase (equal to one third of the cost of the Iraq-Afghan wars or roughly 5 percent of the wage growth projected over the next 3 decades) the program would be solvent indefinitely. Ponzis don't work this way."
- Economist Dean Baker 9/8/11
ShorebreakShorebreak2,699 posts since
Apr 6, 2010
Rep Points: 14,632