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The biggest issue with social security funding is there is a cap on it. Once you put in so much a year, you don't have to put in anymore. It's essentially a reg
by Clubber 5y ago
The biggest issue with social security funding is there is a cap on it. Once you put in so much a year, you don't have to put in anymore. It's essentially a regressive system. A guy who makes a million bucks a year only has to pay social security as if he made $147K. For example, in 2022, everyone only pays social security tax on their first $147K.
https://www.ssa.gov/benefits/retirement/planner/maxtax.html https://www.ssa.gov/benefits/retirement/planner/maxtax.html
- kmonsen 5y agoBut the output is depending on how much you put it, it’s actually progressive. Just less so than taxation in general.
- Clubber 5y agoYes, it's progressive if you just consider the lower and middle class. Actually I think if you get what you put into it, it's neither progressive or regressive. If you include the upper earners, it's regressive. It's as if they capped income tax to your first $100K. Great for one group of people, not for the majority other.
- kmonsen 5y agoYou get more benefits from the first dollars put into SS than the last as far as I understand.
- TimPC 5y agoThere is a cap but I think a large part of that is to prevent people from complaining about the size of pensions paid out by the government. What you get back from the program is a function of what you put in and if you allowed people to put in the portion from $1 Million of income you might owe them $200K pensions after 40 years. I don't think the public has appetite for that.
- rufus_foreman 5y agoI don't have to pay more for my house insurance if I make more money either. So what?