Gary R McCarty

It’s been said that everyone is entitled to their own opinion but not their own facts. Surely, reasonably informed people will recognize that what was intended as a “safety net” has morphed into an entitlement program. The very foundation of the Social Security system is cracked. If it makes you feel better, call it a hairline crack. In any case, that crack will not disappear, but will only grow larger and more dangerous. Let’s at least acknowledge that any insurance company operating on the same basis as the current Social Security program would have been put out of business yesterday and its executives jailed for fraud. Insurance companies are not allowed to pay out more in benefits than what is in the general fund and in fact, if reserves drop below a safe level the company’s ratings would have already dropped to a level where they would have a hard time staying in business.

Social Security has a fundamental problem. It was originally intended to provide only a supplemental retirement income source for a minority of Americans.

Instead it has become the primary retirement income source for a majority of retired Americans. Additionally, Social Security has blossomed into more than just a retirement program. Over the years, other benefits were added that covered widows, disabled workers and children.

Annuities and cash value policies by were designed to provide the bulk of the retirees income. These products offer a stable growth and during the working years and then offer an income for the life of the owner. But today people have put most of their money into a 401k plan that is invested in the stock market which,  in 2008 dropped 40%. The individual who had an income of $40,000 from their stock based plan saw their income lowered to $24,000.

A failure to properly protect their planning during their working years forced a majority of Americans to take early Social Security at age 62 for less than their full benefit because they simply “need the money”

Where do you stand today? When you ask your stock broker they will say to just hang in there, the market will come back. Did you know that a 40% decrease will require over 65% increase with no downturns just to bring the account back to even? When was the last time the market increased over 60% in one year?