Social Insecurity

Social Security Card

Social Security Card – And what a social INsecurity payment looks like (Photo credit: 401(K) 2013)

It’s all over the news how the government is “borrowing” against the Social Security fund in an attempt to avoid falling over the fiscal cliff.  What boggles my mind is how many people think they’ll be able to live on social security in their golden years.  What truly puzzles me is, they actually rely on a government that can’t even balance a budget to manage their “retirement savings” responsibly.

My husband has already gotten his W-2 for last year, and I took a look at all his withholdings.  Social Security made up just 4% of his total pay.  That’s equal to the rate of inflation.  A person with any kind of common sense would not choose to invest just 4% of their savings in retirement, and if they did, they darn sure would place it somewhere with a high rate of return and where the government couldn’t “borrow” it interest-free.

I have to laugh with a kind of sadness at the way the government overspends, then steals money from those who have worked for it, earned it and will need it the most.  What?  Oh, that’s right.  They say they’re going to “borrow” that money.  And I’m sure the government will pay that money back with 9% interest, or maybe even 21%, like most credit card companies charge.  (If you believe that, I have a nice plot of land in Florida I’ll sell you for cheap.)

This whole overspending-borrowing fiasco reminds me of this guy I knew one time.  He was fond of buying junk food, collectibles and DVDs on his lean retail salary, but then when it came time to pay his bills, he was short funds and had to take money out of his retirement account to do so.  Ouch!  He didn’t have a problem with saving money; he had a problem with overspending it (which made it impossible for him to save any).  I think I’d rather live without potato chips now so I won’t have to live on Alpo when I’m 70.

Your income is your biggest wealth-building tool.  There’s nothing magical about it.  Don’t rely on the government to protect your hard-earned money.  I don’t expect ever to see a dime of the 4-digit amount that Peter paid into Social InSecurity last year.  I do expect, though, to see the million-plus that we’re going to save and invest wisely between now and then.

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