The Social Security Scam We Are Forced To Buy Into

 Social Security at its conception, was a good idea to create a safety net for the American people to pay into. While every american has to pay into it, it was primarily to keep an "income" of money coming in for people to be able to afford food and other living costs during the later years of their lives, predominantly as a measure for americans who would end up spending that money in their lifetime without saving any of it. 

That was the idea and supposed purpose for why the Social Security came about. However, Congressional use of Social Security money has created a fear and possible likelihood, that one day social security will be unable to pay for the large number of elder compared to young tax payers paying in to the system. But how can that be? 

By a rough view of the system, life expectancy, and payouts, Social Security should always have a surplus amount of funds. Without going in depth about numbers or the system, we'll look at the extremely broad overview. Tax payers pay into the system via garnished wages and tax returns, which in turn will qualify you for a percentage of monthly payments based on the amount paid in. Sounds great right? But the total of those monthly payments will take a very long time to ever recoup the total paid into the system, probably around 20 years or more, based off of rough estimates for my dad. So with retirement withdrawal age for many boomers born before 1965 to be 62.5years old at the earliest for withdrawal, and now the age limit being 65 as the earliest withdrawal (not including the talks of raising the age to 70), we need to also look at the average life expectancy, which for 2023 was 79.11 years. So what happens to all the extra funds from people who died before ever collecting the full amount the paid into the system? There are more people who die before collecting the full amount paid in then there is that live long past that time. Additionally, as income has risen alot over the years, a lot more is being paid into the system each year based on average wages than previous generations that are now collecting, so even if the current generation is floating the previous generation in "money in-money out" for the system, more is being paid in than what should be being paid out (even taking into account the Cost of Living Adjustments social security sees). So where is all the surplus that should be there, where did it all go? Well, on more than one occasion, Congress has repurposed a lot of the excess money that was building up in there, for other uses. But the problem is, they never returned the money. That in-turn has exacerbated the issue of the generational gap of people collecting social security and people paying into social security, where the excess built up could have likely funded the gap until it closed on its own with time, makes it much less likely now, which is why there are always talks about raising the collecting age, which they have already done once before (from 62.5 to 65).

Another part of the social security scam that actually hurts the payors into the system, is that the money paid in does not yield any growth over time. (The COLA is a percentage on your monthly payments, not your total balance, so that doesn't count as a growth because you're getting shafted any % growth on the whole amount paid in). So, overtime, the accumulated money you have paid in, has become a sizeable amount, but you don't get any percentage of growth on that amount, had you would if you were allowed to chose to invest that money in secured investments with any size of return, instead of the social security program. While I understand, as previously mentioned, that social security exists because the average person would not have invested that money... What-if, instead of mandating the payments be made to social security, it is paid into a secured investment which some rate of return, like a government bond or something of the like, that Congress could easily tailor it to allow growth of the money paid in and allow monthly allotments out when the age threshold is reached? That way your monthly payments from that would increase because your overall investment into the system has grown as a whole, instead of a stagnant sum where the government takes the growth for themselves and pays you off only the paid in amount and a annual COLA based off the monthly payment and not the whole sum. 

Thus, as it currently is, Social Security is a scam to a lot of people. The likelihood you will ever get back the full amount you paid in, is less-likely-than-not, with that chance decreasing overtime as the potential to raise the age of earliest withdrawal goes higher and higher and your likelihood to die before the breakeven amount is less than the average. One day, as there is many fears of it possibly happening in our lifetime, is that there might not be any money in the system to pay out to all the people who paid into it. Lastly, is that drastic change is needed on what happens to the balance of of money paid into he system while the payor is not drawing on the funds and even when they are drawing on the funds. With no growth happening for the payor on the sum paid into the system, the payor is getting screwed out of the interest/dividends the money could be earning elsewhere, while understanding that it needs to be out of the payors hands because of irresponsible saving, they could mandate the funds go into a new created and tailored government bond that is for this money paid in. 

[Most of this is my opinion and conjecture on what I have witnessed in: the social security system, monthly payouts vs what was paid in, congressional acts, congressional talks/hearings; as well as opinions on general financing compared to the system and potential improvements]