Guest Post from N. Schlitter regarding Social Security

Social Security is running a $75 billion deficit that is projected to grow to $322 billion by 2032!!!

The fund will be there in future years, but what will be your actual benefit?  15-25% of your average income over 35 years of paying in?  Who knows for sure, but it does not look good.

Would you invest in a company that was projected to go bankrupt as bad as the Social Suckurity Fund?

According to this attachment, continuing to pay into Social Insecurity would be the same as investing in a company that has operational costs that outpace revenues.......in the billions!

How will this deficit be reduced?

There are only a few options:

a) raise the SS tax (which has already been proposed for 2017, look it up)

b) reduce benefits to people who are currently retired (pay in more, get less of a return)

c) reduce benefits for future retirees (see above)

d) raise the SS tax cap (for 2014 the cap was $117,000)

e) stop raiding the fund to pay for other programs (yea, right)

f) keep people from bilking the system (see above)

e) place a windfall provision on ALL of an individual's retirement income

g) raise the age of full retirement age up from 67 to 70 years of age

h) borrow even more money from China to pay for it

There is always a disclaimer associated with investing in the stock market: "past performance is no guarantee of future results", the same can be said about the Social Security fund.

For decades people have predicted that the SS fund will be depleted and insolvent, it finally became true in 2010 when it began running a deficit for the first time ever.  For those of you that like to point out that the fund has been predicted to run out of money for decades and hasn't yet.....well, that time is now.

How can anyone that still has 20 to 30 years to work before they retire not see the benefit of an exta 6.2% of their income to invest knowing that when it is time for their retirement  Social Security will almost assuredly pay out less than was promised?  Your "guaranteed" return from SS won't be as lucrative as you might like to think.

Take some time to think about how bad you will potentially get pinched if you continue to pay in (i.e. higher taxes, lower benefits).

The government also taxes SS benefits when it is not your only source of income. 

Does losing another 15-20% of your retirement income after federal and state taxes sound good to you when that money could be in a Roth IRA with tax-free withdrawals?

Investing is a risk, that is undeniable, but is contributing money to an insolvent fund any better?

The government has already begun attacking pensions because there won't be enough funds available to support future retirees. They have the right to reduce your pension benefits at any time.  (If you don't believe that, do a little research, an article was published in the 12/11/14 edition of the Star Tribune.

Like it or not, the same WILL happen with the Social Security fund, go ahead, vote YES if you are okay with this and you are confident that the people in charge of the SS fund can fix the mess of a deficit it has. (remember, the national debt is over $18 trillion and counting, their track record at managing money is awful, we all know this)

Social Security Deficits Are Permanent and Set to 
Quadruple in Less Than 20 Years

Social Security began running deficits in 2010, paying out nearly $50 billion more in benefits than the program received in payroll taxes. Without reforms, Social Security's deficits will rise rapidly and will quadruple in less than 20 years.

INFLATION-ADJUSTED DOLLARS (2013)

Source: Social Security Administration.