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Your ignoring 1/2 of Social Security and Medicare taxes. Well, defenders of the current SS and Medicare system keep insisting that they're not really taxes, th

Your ignoring 1/2 of Social Security and Medicare taxes. Well, defenders of the current SS and Medicare system keep insisting that they're not really taxes, they're "contributions" for "insurance" that everybody pays into for the purpose of receiving benefits later. I'm all for abolishing those taxes and funding means-testing benefits out of general revenues, but the left hates that idea because they don't want SS and Medicare to be thought of as welfare. The bottom quintile pays over 20% if they have a job. Medicare alone is 15.3%. That's Social Security, Medicare is only a few percent. But the rate is correct; "your employer pays half" is a legal fiction.

anamax 15y ago
> Well, defenders of the current SS and Medicare system keep insisting that they're not really taxes, they're "contributions" for "insurance" that everybody pays into for the purpose of receiving benefits later. Note that the benefits payouts are incredibly progressive. Folks who don't put much money into SS get a much better return on their money than folks who "contribute" the max each year.
- Retric 15y ago
  Except married people receive dramatically better benefits than single people.
  - anamax 15y ago
    > Except married people receive dramatically better benefits than single people. "better benefits" depends on their income distribution. There are folks who don't marry because that would result in smaller social security benefits.
    - Retric 15y ago
      It's true that the benefits from marriage A can decrease after marriage B. But, they are still higher than if everyone had been single the whole time. AKA the only time where X and Y getting married lowers their combined benefits if X or Y was married to someone else z before this and where receiving marriage benefits from this.
      - anamax 15y ago
        I'm pretty sure that my wife and I reduced our (future) SS benefits by getting married, and neither of us have been married before. (We definitely increased our income taxes significantly - welcome to AMT.) We both have decent incomes, so there's no "he'd have benefited from the low-income subsidy".
        Retric 15y ago
        No, it does not work like that. The math on benefits are really simple you can take either your SS benefit or 50% of your living spouses or 100% of your dead spouses. Taking 50% of your spouses is a proxy for the 'low-income' subsidy where a single worker is supporting 2 people. There is a minor 'penalty' for taking SS early which is supposed to even out the expected benefit but this is calculated for each benefit separately. So, let's say you decide to retire at 62 and not wait till 68. You have 2 choices you can take your normal befit and gain nothing, or you can take your 50% your spouses benefit at 62 wait until 68 take your benefit calculated as if you had revived zero benefits. Net result your ahead. PS: Feel free to use there calculators to check this out: http://www.ssa.gov/planners/benefitcalculators.htm http://www.ssa.gov/planners/benefitcalculators.htm
deleted 15y ago
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anamax 15y ago

> Well, defenders of the current SS and Medicare system keep insisting that they're not really taxes, they're "contributions" for "insurance" that everybody pays into for the purpose of receiving benefits later. Note that the benefits payouts are incredibly progressive. Folks who don't put much money into SS get a much better return on their money than folks who "contribute" the max each year.

Retric 15y ago
Except married people receive dramatically better benefits than single people.
- anamax 15y ago
  > Except married people receive dramatically better benefits than single people. "better benefits" depends on their income distribution. There are folks who don't marry because that would result in smaller social security benefits.
  - Retric 15y ago
    It's true that the benefits from marriage A can decrease after marriage B. But, they are still higher than if everyone had been single the whole time. AKA the only time where X and Y getting married lowers their combined benefits if X or Y was married to someone else z before this and where receiving marriage benefits from this.
    - anamax 15y ago
      I'm pretty sure that my wife and I reduced our (future) SS benefits by getting married, and neither of us have been married before. (We definitely increased our income taxes significantly - welcome to AMT.) We both have decent incomes, so there's no "he'd have benefited from the low-income subsidy".
      - Retric 15y ago
        No, it does not work like that. The math on benefits are really simple you can take either your SS benefit or 50% of your living spouses or 100% of your dead spouses. Taking 50% of your spouses is a proxy for the 'low-income' subsidy where a single worker is supporting 2 people. There is a minor 'penalty' for taking SS early which is supposed to even out the expected benefit but this is calculated for each benefit separately. So, let's say you decide to retire at 62 and not wait till 68. You have 2 choices you can take your normal befit and gain nothing, or you can take your 50% your spouses benefit at 62 wait until 68 take your benefit calculated as if you had revived zero benefits. Net result your ahead. PS: Feel free to use there calculators to check this out: http://www.ssa.gov/planners/benefitcalculators.htm http://www.ssa.gov/planners/benefitcalculators.htm

deleted 15y ago

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