SS Cap

[serryjw]

I think it caps around $87,000. When was the last time this was raised? Is there ANY 'means testing' currently for SS? How do you figure out whether someone is RECEIVING more SS than they paid in? is there any website for contribution vs payments already calculated? Right now it is a 3/1 radio of people working vs RECEVING SS. Based on the age of the boomers is there any way to find out when it goes into NEGATIVE with more being paid out than contributions based on the cuurent numbers?

[David Dunham]

1. The cap is raised every year based on inflation. About $4k a year.

[Goathead]

2. The wrong idea

My first impression was "why is somebody starting a thread about Nazi head gear?" I guess it was because I was in an antique shop where this guy was selling all this Nazi regalia yesterday. Sorry, don't know why I needed to share that.

[serryjw]

8. RFLOL!

It's becuase of Bushit grandfather you were thinking about!:P

[Goathead]

11. Hauptsturmführer Prescott Bush himself!

I'm also reading American Dynasty: Aristocracy,Fortune, and the Politics of Deceit in the House of Bush right now. What a ghoul Prescott was, he stole Geronimo's skull. I guess grave robbing is a Bush Crime Family value

[papau]

3. 2005=90,000, raised every year, there is no means testing -

there is a limit on how much you can make and still be considered retired - (enforced via reduction in benefit - and a tax on benefit if earnings over a certain amount)

SS maintains records of contributiuons

Rate of return calculations do not make sense for an insurance program that is progressive - low paid have higher return than high paid - and in both calculation the value of the life insurance.survivors/dependants benefits is never included in calc.

The ratio never goes negative - around 2030 it reaches 2 to 1 and stays there for next 100 years

And at 2 to one there is no problem financing all of the current Social Security benefits with only the tax now in the law - no tax increase is necessary if one assumes the same kinf of productivity growth and GDP growth that Bush assumes for his private accounts.

[ICantBelieve]

4. I think they should raise the cap...

I think they should raise the cap on SS from $90,000. Make it higher. I realize that (I guess) the cap is currently set based on what the maximum SS payout is, but forget it. If they need more money for it, why not tax the wealthy?

Oh, I forgot, because they vote Republican...

[Disfronted]

5. answers

1) The contribution cap is indexed

2) The SS system is set up so your benefits are based on your contributions, but the scale is progressive. In other words, someone who paid in $100,000 might recieve $200 a month, whereas someone who paid in $200,000 might receive $350 a month.

Everyone who receives social security receives (if they live to the expected age) more than they paid in, earning a real interest rate that's between 3-6% (with the lower your contributions, the higher your rate of return on them).

3) I believe the flow into the "trust fund" will reverse itself starting in 2015, although the fund itself will not be exhausted until 2042.

[papau]

12. flow into the "trust fund" will reverse itself starting in 2018 :-)

:-)

[newyawker99]

15. Hi Disfronted!!

Welcome to DU!! :toast:

[blueheeler]

6. The cap should not be raised!

It should be gone!!! The problem would be solved!
I magine what the CEOs and Politicians alone would do to contribute!

[regionalprogressive]

16. Lets give it another try!

From Each According To His Abilities, To Each According To His Needs

[Hamlette]

7. there is talk of raising the cap to $200,000 or take it off altogether

the best part is, SS taxes come before you get any deductions. So all those rich people who Bush said don't pay taxes because they are rich enough to hire accountants and lawyers to get them OUT of paying taxes, SS is the hardest one to get out of.

There goes the tax cut for rich people. Will all get eaten up when/if they lift the cap.

I think lifting the cap is the best idea. Get rid of it all together. It only applies to earned income, not stocks etc. Someone makes over $90K they can subsidize those who don't.

[serryjw]

10. You guys are all great!

Hamlette

I don't get this.please explain???

I think lifting the cap is the best idea. Get rid of it all together. It only applies to earned income, not stocks etc. Someone makes over $90K they can subsidize those who don't.

[Hamlette]

14. you only pay SS tax on the first 90K of earned income

change the law and tax ALL earned income.

The 90K figure is based (loosely) on maximum SS benefits and is set by law. SS benefits are roughly determined on how much money you put in. I say "roughly" because it is progressive. People in the lower income brackets get a higher "yield" than people at higher income brackets.

But, my theory is that people who make over 90K don't need all that money and people who make say...less than 25K do so let the rich bail out SS with NO increase in benefits for the higher earners.

Here's a fun "quick calculator" at the SS web site. You can put in your date of birth, your current earnings and anticipated age of retirement and it will roughly estimate what your benefit will be.

http://www.ssa.gov/OACT/quickcalc/calculator.html

[ICantBelieve]

9. If we took the cap off altogether...

would that be too much? Err... could we then lower the % that everyone pays? Remember, too, that employers match the contribution, so we'd be hitting all companies as well as rich employees. I'm not saying that's necessarily bad, but it does amount to a HUGE tax increase for people who make a lot of money. I'm not saying that's bad. We just have to realize that it is a HUGE increase if we lift it altogether.

[papau]

13. yes - the 12.4 might be lower - more likely a portion would be assign

to medicare

thereby solving that problem for a few more years.

[MisterP]

17. we could make "dips" in the total for smaller businesses

we can call the dip George Bush, because that's what he is