Public and private approaches for redesigning social security
Article Abstract:
The social security systems of many countries have been criticized for problems including early retirement, high payroll taxes and financial instability. However, proposals to privatize the plans are misguided because many people are not skilled enough to manage their own investments, leading to retirees without adequate income. Therefore, a better approach would be to improve the social security systems through reforms, such as tying compensation to nationwide wage rates instead of inflation and keeping the years between retirement and expected death even using a ratio.
Publication Name: Journal of the American Society of CLU & ChFC
Subject: Law
ISSN: 1052-2875
Year: 1996
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Social security's financing problems: realities and myths
Article Abstract:
The belief in a social security crisis is based on a series of misunderstandings concerning social security funding. The Old-Age, Survivors, and Disability Insurance is actually a stable, financially healthy system because it is funded by payroll taxes. If there ever were a true shortage of funds, the difference would be made up by a social security tax increase or possibly a reduction in benefits. The Disability Trust Fund has been depleted at a higher than expected rate, but it can be replenished through a reallocation of taxes between disability and retirement.
Publication Name: Journal of the American Society of CLU & ChFC
Subject: Law
ISSN: 1052-2875
Year: 1993
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Privatization of social security: a good idea?
Article Abstract:
It is generally accepted that the social security funds are not stable and are unlikely to be available for those currently under 30. However, proposals to privatize the fund will not work because only those who are low-cost for social security are likely to have enough funds to privately invest while high-cost persons will probably end up on a tax-subsidized program anyway through welfare. A better proposal involves reforming social security to allow for long-term solvency through, for example, reducing benefit levels or increasing contribution levels.
Publication Name: Journal of the American Society of CLU & ChFC
Subject: Law
ISSN: 1052-2875
Year: 1996
User Contributions:
Comment about this article or add new information about this topic:
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