Monday, March 07, 2005

Social Security Blues – Make A New Plan, Stan...

It is important for me (and others) to remember that for some people the Social Security program is a small part of their retirement plan. For others, it is their retirement plan. Without the monthly payments, millions of seniors would face destitution.

There are serious repercussions if this change is not handled correctly. If you are over 18 years of age, you can't afford to ignore what is being proposed.

My first search for the modernization of Social Security was targeted directly to the official White House web site -

The first thing that I encountered was a series of press releases the White House calls "Fact Sheets." These fact sheets are produced by the Office of the Press Secretary.

The Fact Sheet "Strengthening Social Security for Future Generations" introduces the concept of Personal Retirement Accounts. I thought the idea was to transfer money from Social Security to individual controlled investments? How does this make the system stronger? I'm getting ahead of myself.

Twenty minutes and a few more links later, I think I have found the plan. I was able to download Adobe PDF files of the booklet or specific sections.

In terms of accessibility, I do think there should have been a text and/or html version of the booklet available. I zoom into section two, "Strengthening Social Security" I come away with the following:
  • No increase in payroll tax.
  • No change for those nearing retirement or have retired.
  • Supports voluntary personal retirement accounts.
Hun? That's it? But what is the plan? The process? The steps? I still have questions!

I move to section three, Personal Retirement Accounts. After reading this section, my guess is the fix is the introduction of Personal Retirement Accounts. Workers could place initially up to a $1,000 a year. The money would be invested in conservative bonds & stock funds. You would not have access to the money for loans, withdrawals or emergency needs.

Although you will be kept informed of your account activity, you don't have all that much to say about how your account is managed.

The most important point that hasn't been emphasized is that once you opt out of traditional social security you can't come back into the program. It is a one-way street.

Citizens who chose not to use personal retirement plans would continue to draw benefits from a reformed, sustainable Social Security system.

But what is the reformed system? I dunno. If you have less people contributing into the system, how is that sustainable? I dunno.

What if you investments get wiped out due to Acts of God/Nature, war or corporate malfeasance? What will be your recourse? What about inflation? Controls on theft, over billing or fees? Can the IRS claim your current or future retirement income? What about technology based security measures?

Haven't a clue. Maybe I haven't found really found the plan. I spent another 45 minutes looking for it. It is possible I have just found an expanded proposal. The search continues...

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