I have nothing against defined benefit plans. However, I disagree that only the plans that are poorly run are expensive. Many actuaries, investment managers, and accountants, and a lesser number of attornies, earned a good living serving defined benefit plans over the years. Nothing wrong with that. But, defined contribution plans are clearly less expensive.

Regarding participants not paying attention to their defined contribution plans, that's probably true. However, many times participants cost themselves money by tinkering with the mix of investments. Human nature has a way of causing people to sell low and buy high. As a friend of mine is famous for saying, portfolios can be like a bar of soap. The more you handle them, the smaller they get.

Blame the day job. To me it's liek a mass balance equation. NET Inputs = NET Outputs. If you examine the flow of money like it's a process, to me at least, it seeme as clear as 2+2=4... if you assume that government budgets should be balanced.... but I suppose that a different topic altogether. My town and our state at least, have balanced theirs. But then again, maybe thats why we've never seen the explosive growth of other states that are no facing massive deficits and near bankruptcy.

How does that change the implied obligation of upper wage earners to lead society both physically and financially. If we're satisfied with a very broad range of wages form the lower wage earner to the top, then how else do you propose we provide the services tha society demands without raising taxes on the top wage earners? How can you possibly argue that it's fair for a household making $60k/year to take on the burden of incresed taxes, but its' unfair for a household making $200/year just because they took on a "big risk". It's a net sum eqution, if you want one group to pay less, then you have to have thet other groups pay more.

Isn't the freedom, satisfaction, challenge and status of owning your own business worth nearly as much as the increased salary. Does EVERYTHING in life need to have a financial incentive?

A survey of most professionals shows that compensation is their 3rd or 4th concern to job satisfaction. You could increase my salary 30% or 50%, and I can guarantee my quality of life would not improve significantly. having a house 2X larger, or driving a Lexus instead of a Toyota isn't going to make a person happier. Many think it will, but it won't.


I would like to start a small business in the future. I suspect my wife and I will eventually work towards that goal. But I wouldn't do it for the money. I know that I'd make less money than I do now, but I'd enjoy my job more and I'd enjoy the challenge and greater sense of accomplishment.

Like I thought--you don't really have any idea what it takes to run a business. That's not a slam against you personally, but rather an observation.

Everything makes sense to you because you think it's all some sort of magic: start a business, make money, happily give increasing chunks of the money away to the less fortunate.

Everything in life does NOT have to have a financial incentive. Which is exactly why we don't solve problems with money, either. Get it?

What does any of this have to do with SS?

One way to fix it is eliminate all persons drawing it. Okay you can't do that. Sorry it can't be fixed. We can only let it roll.

If SS withdraws or deposits were to end tomorrow most individuals would not have and won't be able to save, invest, accumulate enough to pay the bills after they can no longer work. The aged population will be broke from medical bills too. Talk about homeless with no hope in sight.

Also as the years pass if less people opt out of the workforce jobs will be harder to find for the younger people coming behind them. Which my guess says means more unemployment, and crime. Birth control anyone!

Back when IRAs were created we were told by the adminstration that they would be our savior. I invested a big chunk of income into IRAs and 401ks like a good citizen planing for the future. It was all to compound like crazy and turn into millions of dollars. SS could be eliminated if that were the case. Well it didn't compound into millions and SS is still here.

Frankly I think the scheme is here until it goes bust so you better save lots of money instead of spending lots of money. Just saying.

He thinks the solution is to fix the SS problem by shifting more of the cost to the "rich," however that's defined.

Why isn't that relevant?

Because THIS time its actually going to work.

And FWIW, I could absolutely start and run my own successful business. I just need a good idea, funding, better marketing/networking skills and a few extra hours every day (because I happen to like sleep.)

I only suggest shifting more burden on the wealthy because 1) They can afford it. 2) They used to pay a lot more many decades ago, it's not like we're raising taxes to unprecidented levels. 3) Because money doesn't grow on trees and we can't borrow increasingly larger anounts of money forever.

Actually you can eliminate SS, but you would have to supplement the incomes of millions that rely on it with soemthing else. Whether a $1 bill is in my right pocket, left pocket or lying on the ground, its' still a $1 bill.

One thing to keep in mind is that your life expectancy goes up the longer you live. For instance, someone born in 2006 had an average life expectancy of 77.7 years but someone 65-yo then had an average life expectancy of another 18.5 years. So many of us can probably expect to live into our 80's and, with good genes, into our 90's. The Table published in 2006 can be found at
http://www.census.gov/compendia/statab/2010/tables/10s0105.pdf

A wise man recently reminded me, and he is living very comfortably, that a very famous bank robber was asked "Why do you rob banks?" His reply was, "That's where the money is?" Taxes are a price to pay so society can co-exist without turmoil. Government must get it where it is. This person I speak of also reminded me that although the richest few percent-top ten for instance pay 80 or so percent of the taxes they also have 80 percent of the money so it makes sense they pay more. Yes there is waste in government spending and it should be reduced and eliminated if humanly possible but we are in the bind we are in because taxes are too low for the 80 percent of the money earned. We won't agree. That's okay. I saved mine.