3 ms·
The 401k limit increases $1k and the Social Security tax limit increases $5k to $147,000. In 2000 the Social Security tax limit was $76,200 so that is a 93% in
by 300bps 5y ago
The 401k limit increases $1k and the Social Security tax limit increases $5k to $147,000.
In 2000 the Social Security tax limit was $76,200 so that is a 93% increase. Inflation increased only 59% in that time.
- nemo44x 5y agoI think it’s because upper middle class salaries have increased a lot and to keep the system solvent the limit has to increase. Especially on the coasts people making 150k plus is not too unusual.
- curryst 5y agoI think it's related to wealth inequality. Social Security only taxes the first ~$150k you make in a year. If a million dollars is redirected from the poor to the rich, we lose Social Security income. In theory, that decreases the Social Security we have to pay out, but in reality, that would mean letting those people die when they get old, so we'll pay for it one way or another. Plus, you know, people not having kids. Social Security isn't pre-funded, so it kind of depends on the labor force growing indefinitely. That was a terrible idea, but I can't see any way to fix it now.
- drtz 5y agoSocial Security is on its way to insolvency thanks to slowing population growth and increases in longevity. It has to increase faster than inflation to keep up.
- dlp211 5y ago$4200 not $5k, and if Congress won't fix SS, the trust will try it's damnedest.