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Would you privatize Social Security?

By Jennie L. Phipps · Bankrate.com
Sunday, November 27, 2011
Posted: 6 am ET

Former Speaker of the House and current Presidential hopeful Newt Gingrich created a storm last week when he suggested that young people should be allowed to bypass traditional Social Security in favor of private investment retirement accounts.

Under Gingrich's plan, the employer share of Social Security would go to pay benefits for current employees, but younger workers would be able to invest their share of payroll taxes in stocks and bonds.

Gingrich says the plan would let people control their own retirement planning investments, while guaranteeing a minimum level of benefits. Participation would be voluntary.

“If you are dumb enough that you prefer to get less money with less control while relying on politicians, that’s your prerogative,’’ Gingrich says. “You’re an American. You’re allowed to be dumb.’’

Gingrich says his plan would cover Social Security's pending shortfall by turning over to the states a total of 185 public programs, including Medicaid, Section 8 public housing and Pell Grants that pay for college tuition.

On his website, Gingrich calls Social Security, "one of the few unqualified success stories of the Federal government." He says it has been "looted and must be protected."

What do you think? Are you in favor of dismantling Social Security as we know it now in favor of private investment accounts? Have you done better with the money you invest in your 401(k) than Uncle Sam does with Treasury bonds?

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13 Comments
Jo
November 28, 2011 at 5:04 pm

I have done better with Social Security than my 401k.

I have spent periods of trying to get my money back I have lost in the market. I kept hearing that we needed to be in the market to beat inflation, so I jumped in at several different times. I had the brokerage choose it for me and other times I have bought on my own. I lost no matter which way I went. Losing money in the market has hurt me more than inflation would have.

I trust the government with my money more than the stock market. There is a push to stop Social Security for the younger generations. The young should fight this.

Only the higher paid are living longer, so the thing to do is take the cap off of the wages that are taxed for Social Security taxes. If the wealthy CEOs would pay more into the fund that would solve the problems.

tammy
November 28, 2011 at 3:05 pm

Social Security is nothing but legalized stealing and should stop. To continually take our money and then tell us it won't be there for the intended purpose is nothing short of stealing from the American people. I am all about helping others but charity should be a personal choice and not forced. Even if people aren't aware of "market trends" doesn't mean people aren't capable of learning. Once again the Government forcing choices on us in the name of our best interest as if we are all children indefinitely instead of letting us make those choices and treated like the adults that we are.

Omar T
November 28, 2011 at 1:29 pm

T%he Chilean model is working perfectly. And they are getting 1.5 to 3 times what you get in SSA benefits in comparisson. The government still secures the minimal amount to be paid. So far, the market has provided for them NOT to pay a single penny to anyone. Off course some in Washington will HATE to lose control over the masses. -

Wolverine
November 28, 2011 at 12:03 pm

I bet privatizing Social Security scares the hell out of Jennie Phipps. She needs her some Social Security!!!!!!

Gotenough
November 28, 2011 at 9:21 am

I personally would be far better off with privatizing SS and I am completely opposed to it. Those who earn less -- and thus pay less in -- get a far greater return on the money they put in. SS is all about society assuring a very basic level of security to those in old age. It is not a great retirement vehicle for the upper middle class, but that is not why I support it. I fear that the elderly poor in this country would slip into severe poverty without it.

Dwight
November 27, 2011 at 11:43 pm

I think it a great ideal for person whr is to be responsible, to take charge of their own future. Look at the money you are paying in at 100% while working and look at the money you get when you retire, 30% back "maybe". The government is the problem in the first place. Look at how the so call people looking out for the american people retire (congress), like fat cats. Besides the government want wealth to be spread equally.

Jay
November 27, 2011 at 9:46 pm

When are you going to realize that republicans and democrats are the same party just playing good cop and bad cop. Once they get in office it will always be the agenda of the CFR and owners of the privately owned federal reserve.
The current social security system allows the govt. to confiscate money and pay it back (if you live long enough) in depreciated dollars.
It is not irresponsibility it is a ponzi scheme. It is the government version of Bernie Madoff.

Jo
November 27, 2011 at 5:18 pm

Apparently Gingrich thinks if only we were all as smart as him, we could all do the type of insider trading that Congress does. Or get paid millions to give "advice" to government-owned companies. For most people, a government guaranteed retirement is much better than one riding on the vagaries of the stock market.

Hannah Z
November 27, 2011 at 5:05 pm

The government cannot be trusted with people's savings. Decades ago, when they were taking in more payments than they were paying out, they should have saved it up. Instead they spent all of it and them some, creating the crisis we have today.

It's true that some people are irresponsible with their money, but having just a few be irresponsible with their money is far better than forcing EVERYONE to hand their savings over to a body that spends all of it and is 100% irresponsible with it.

Save First
November 27, 2011 at 11:33 am

For the fractional percentage of the population that understand long-term investing and can accept market risk, I am 100% for it. Looking solely at my financial needs, I think it is a great idea.

However, for the majority of American who do not understand how the market works (i.e. cycles, "not always going up", etc...), I regret to say someone needs to police them to avoid "personal bubble bursts" to their own financial status.

You see it all the time - people chasing historical rates of return and then panic-selling on the first big market drop. For most of these folks, their entire retirement currently rests on Social Security. Letting them choose how / when / where to invest it is far too risky to the overall fiscal health of the nation.