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PolySciFi Blog

Thursday, February 10, 2005

 

Let's Solve Social Security

Having a job, a family, a house, a commute and what passes for a life has shown me that taking on responsibility takes up increasingly larger amounts of cognitive ability. In short, the more sh!t I have to do, the stupider I feel.

Anyway, seeing everyone nicely discuss Social Security and interest rates got me thinking: I've a few unconnected ideas about social security, so maybe I'll throw them up here and let you tear me to shrdes.

Here goes.

1 - I read George Will's endnotes in Newsweek this week. It talks about Federal employees retirement options and how well they've done. They've done better than I have (and WAY better than my company stock).

2 - It seems to me the biggest downside of private accounts of any type is that they take money out of the current system.

3 - right now, you can elect to receive 80% of your benefit at 62, or wait until you're 65 and receive 100%. If you elect to get money at 62, you stay at 80% forever. I like choices.

What if you could elect to put 2% worth of your salary into manageble funds/securities and 4.4% of your salary into the fund. You take a hit on your guaranteed benefit, but now you're running some money in something that has potentially higher return. The percentages could be variable for different ages. This reduces future entitlements.

4 - biggest benefit of private accounts to me - the money is potentially invested in companies, not the government. Hopefully, this capital helps the economy boom. Bigger boom = rising tide = boats floating.

Anyway, some random half formed ideas.

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