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a guest Mar 18th, 2019 71 Never
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  1. Your payout relative to your contributions is a sliding ratio based on your income (contributions). Social security isn't just a pension plan -- it's also a welfare plan. The more you put in, the less you get back as a ratio of what you paid in. The poor get the highest ratio of return relative to what they paid in. Those at the cap (~$127k/yr currently) get the worst payout ratio.
  2.  
  3. This is how your SS payment is calculated:
  4. The first $749 of average monthly earnings is multiplied by 90 percent, the next $3,768 by 32 percent, and the remainder by 15 percent. They apply that to your 35 highest earning years. If you have less than 35 years of contributions, then they use 0's for those years. The average is then your payout which is adjusted by the fake inflation ratio known as CPI every year.
  5.  
  6. So that 90%-32%-15% bracketing they do heavily weights social security payouts relative to contributions for the poor. Those making over $54k and up to the $127k cap are the most screwed over (i.e. the middle class). Then the very rich don't even have to pay the full tax on their earnings. So while someone making $100k/yr self employed is paying over 15% of tax to the "sorta pension mostly welfare system", those making $250k/yr are only paying that 15% on half their income. The rich keep more of their money. The poor get plenty of free money, and once again, the middle class are funding most of it and getting the most screwed. I have heard the argument that the cap is perfectly fair, but that's because people don't understand the calculation and how there is a huge welfare component to all this:
  7.  
  8. Demonstration:
  9. Average Earnings to Payout (rounded to whole percentages)
  10. $1000/mo = $ 754 (75%)
  11. $2000/mo = $1074 (54%)
  12. $3000/mo = $1394 (46%)
  13. $4000/mo = $1675 (42%)
  14. $5000/mo = $1825 (36%)
  15. $6000/mo = $1975 (33%)
  16. $7000/mo = $2125 (30%)
  17.  
  18. And near the top of the cap:
  19. $10000/mo = $2575 (26%)
  20.  
  21. And that is how the average American was tricked into a forced charity program disguised as a pension. What's to say they won't tweak the 90%-30%-15% bracket formula before we all retire? As they start to run out of money, they'll do 90-25-10, 90-20-7.5, etc. They will figure out how to fuck us hard before it's all said and done.
  22.  
  23. And now you know (and knowing is half the battle).
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