Thursday, March 27, 2008

The Social Security System is Broke

They call it Social Security, but a better term would probably be Social Insecurity. The Social Security System is Broke. It is broke in the US, it is broke in Europe and also Japan. They know it, but do you? Your taxes are going up - your benefits are going down. What do you want to do about it?

Social Security in the United Sates, and many other countries for that matter, have a very similar arrangement, and the concept was certainly perhaps a noble idea on the part of politicians, albeit not a economically sustanable one. However, the problem is that most people really did not understand what the system was all about, and how it truly functions. If they really knew, they most likely would have rejected the idea from the start. Which is to say, many people think (or thought) the government was taking money out of their paychecks every month and putting it away somewhere in a special account. In other words, many people were lead to believe that the government was saving money on that persons own behalf for retirement. Not True, or in the least this is not the way it works. It was a nice party while it lasted, and now comes the hangover......

Read more here: John Schroder of Ascot Advisory Services

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