Saturday, July 23, 2011

The Pulse: Fixing Social Security

What is Social Security’s purpose?
  • Provide a safety net for the elderly and poor
  • Started in 1935 by FDR during the great depression
  • Now provides disability and unemployment benefits
  • Intended to help people in retirement, not be their sole funding for retirement
What are the problems with Social Security?
  • It will go bankrupt if not reformed
  • Recipients making it their sole form of retirement
  • When started it provided full benefits at age 65, now they provide fill benefits at age 67
  • When started, Life expectancy was 62, today it is 78
  • The program does not allow enough productive years to fund retired years
  • There are too many baby boomers and too few workers to fund the program in the future
  • The program was never indexed to life expectancy
  • People will keep on living longer as technology advances requiring retirement ages to rise as well.
These are the solutions to Social Security’s problems
  • Move the full retirement age to 71, where it would be today if it had been originally indexed to life expectancy
  • Index the system to life expectancy the way it should have been from the start of the program
  • As people age, move them into mentoring, counseling, managerial roles for easier working years as they age to not lose their knowledge and expertise.
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