YahooPoolAimer (December 31, 1969 at 5:59 pm)

If you earned 5% growth rates, then that would only be a 2% real return after inflation. Broker fees are minimum 1%, or 2% on average... which is most of your earnings.This is why countries like Chile with privatized pension plans have seen most of their market gains lost to fees and administration. Social Security is far less than 1/1000th the overhead of a traditional investment vehicle.Social Security is by far the most efficient system, revenues based on taxing the entire economy.

leearnold (December 31, 1969 at 5:59 pm)

"Risk free" here means "FDIC insured" means "covered by a taxpayer bailout" if it crashes.Currently, Social Security is heading between the Trustee's low-cost and middle-cost projections. Hardly a failure, not even a big problem if it comes to it.

anthony1832 (December 31, 1969 at 5:59 pm)

high yield accounts insured by the FDIC are completely risk free. Once you reach the maximum that the federal government will insure, its simple to find another bank with a high yield account. have the interest on your 100k-200k (depending on if you have a joint owner) spill over into a different high yield account at a different bank. It's simple, social security is a failure.

leearnold (December 31, 1969 at 5:59 pm)

Learn about risk. Average return is not actual return --actual may be more, it may be less. And it doesn't pay-off in down cycles, nor help against some other possible adversities in life.

anthony1832 (December 31, 1969 at 5:59 pm)

fair enough on the political thinglosing your shirt happens all the time, if you look short term. for large common stocks the worst single year was in 1931 with a average loss of 43.3% however, even that year is included in the 20 year indexes, and still the lowest average return has been a positive 3.1%

leearnold (December 31, 1969 at 5:59 pm)

Losing your shirt is not hard to do either: see today's newspapers, Sept. 15, 2008.

leearnold (December 31, 1969 at 5:59 pm)

I deleted your other comment because it advocated a political candidate. One of several reasons to get booted from here.

anthony1832 (December 31, 1969 at 5:59 pm)

even at 3% which can be earned in an ING savings account and is risk free, and insured by the federal government up to $200,000 with a joint owner, you will still end up better than the social security system.Also, on a 20 year investment horizon the best average return on a large company stock portfolio has been 17.7%. The LOWEST has been a POSITIVE 3.1%, and that was during the great depression.earning 5% is not hard to do.

leearnold (December 31, 1969 at 5:59 pm)

As in some of the other comments here, this ignores RISK, in financial markets, in life. You need a retirement account and a safety net, and you aren't seeing enough income to pay for both -- although Lehman Bros. is now bankrupt on $613 billion dollars worth of debt. Who would bail out your annuity? The taxpayers. Social Security is not a retirement account. It is the SAFETY NET.

anthony1832 (December 31, 1969 at 5:59 pm)

do an annuity. $31,695 salary = US median income.12.4% of that is given to the gov't 1/2 paid by employee 1/2 paid by employer.12.4% of $31,695 = $3,930.18lets assume the individual earns that salary from age 21-64, no raises, not adjustments.put that in an annuity earning 5% (a pretty conservative rate)by the time you are 65 you will have $623,720.if you can earn 5% on that sum you will make $31,186 a year in interest, and have a fortune to pass on to your children.