Social Security Faces Long-Term Challenges, but There Is No Crisis

The Social Security Trust Fund has accumulated more than $1.7 trillion in reserves that are held in Treasury bonds. According to the Congressional Budget Office, even if no changes are made, Social Security will be able to pay full benefits for the next 50 years. We have time to come up with a bipartisan solution that will strengthen the Social Security system for generations to come.

What is Social Security?

Social Security was initiated after the Stock Market crash of 1929. Social Security is one of the few, TRUE, American success stories. In 70 years it has helped millions have the dignified retirement they deserve and have earned.

Social Security is a “defined benefit” pension system and family insurance. Benefits are determined according to the level of a worker’s earnings and years of work. Social Security provides regular income in retirement and are paid as long as the worker (and spouse) lives.

It provides benefits for elderly widows, and young parents who have lost a spouse. It provides dependable monthly income to children who have lost a parent to death or disability. It even pays benefits to those who became severely disabled as children, and remain dependent as adults on a parent who receives Social Security.

• Almost 700,000 Arizona residents are over 65
• 235,000 people are lifted above Poverty line by Social Security.
• Without Social Security 43% of those 65 or older in our state would be below the poverty level.
• Nationally, since 1975 there have 3.2 to 3.3 workers for every retiree, a number that has remained constant.

Privatization

Private accounts mean a reduction in monthly payments, and taking an unnecessary risk with your money. Privatization is a voluntary action; regardless of your enrollment you will have a cut in your Social Security check. If you voluntarily enroll you cannot get out of the system. At the time of your retirement, you will be prohibited from receiving a lump sum payment. You will have to purchase an annuity and guess how long you will live to receive monthly payments. If you underestimate your life expectancy; your family risks missing out on potential benefit disbursement or you risk receiving no benefits due to your under-calculation made years before.

Facts About the Administration’s Social Security Plan:

• The plan is not voluntary - Everyone’s benefits will be cut. If you choose not to invest in a private account, your benefits will still be cut over 40%.
• 70% tax on accounts - On average, for every dollar you have in your investment account, the plan would deduct about 70 cents from your Social Security check.
• You cannot pass on to children - At retirement, you will be required to turn over most of your account to an insurance company, which will give you a monthly income. Leaving little or nothing to leave your children.
• You will not control your own money - the money is not yours to invest as you see fit; instead the government will choose which funds you are allowed to invest in.