During a radio interview I gave recently, the interviewer picked up on one of my “Straight Talk” articles titled, “Is Social Security a Giant Ponzi Scheme?” During our exchange, we discussed such subjects as the regularly increasing FICA payments by all wage earners and the uncertain nature of the system’s trust fund as well as the perennial question as to whether our government will risk going so far into the red that Social Security could bankrupt the country.
At one point I got the impression the interviewer was more concerned about his own personal situation than simply airing a topic for the benefit of his listeners.
Near the end of our conversation, he asked if I thought there was a “fix” for Social Security. Thinking he meant some way the system might be revamped in a fairer and equitable manner to become fiscally sound, I answered, “I see none.” Had I taken a few more moments to reflect, I’d have responded in the following manner.
There’s no collective “fix” for the system, as the politics and economics make the system unalterable for the mass of its contributors and recipients. However, if you’re viewing this singularly, there are a number of things you might do to decrease your personal risk. You should be aware certain types of income are exempt from FICA tax and for those persons eligible to opt out, there’s a chance to partially or wholly escape the system. A number of years ago I published a book titled Nobody’s Fool: A Skeptic’s Guide to Prosperity– now long out of print– in which I described in some detail exactly how to reduce your tribute to this out-of-control tax collection scheme.
Consider government programs designed to advance the welfare of its citizens, wherein an agency is created to collect sums of money from the prospective recipients and distribute benefits to them. Normally there’s a typical procedure followed. Initially, the sums both in and out are small and of little notice or concern, but as the program continues to operate, the numbers grow larger and rules and restrictions on all parties become more obligatory. Eventually, the program is too entrenched to be phased out and its existence is thereafter set in stone. With that said, let me welcome you to the Social Security System. It will be with us forever.
Al Jacobs, a professional investor for nearly a half-century, issues a monthly newsletter in which he shares his financial knowledge and experience. You may view it onhttp://www.roadwaytoprosperity.com.