Can you survive if Social Security payments stop?

https://thehill.com/opinion/nationa...ebt-default-would-mean-for-national-security/

Much news in recent months about the national debt default that bares directly on this thread. Despite considerable gloom and doom predictions by financial people, I personally am not bothered or worried by it. No I don't understand financial issues because I purposely avoid reading about their news except to note I tend to dislike Wall Street and the rest of our financial and real estate masters. If my monthly SS benefit checks became interrupted for months, it would not directly affect my life at all though I do understand that would not be the case with the many seniors living month to month without savings. Politicians over the recent two decades have spent so much beyond incoming revenues that inflation has greatly increased. The US neoconservatives spending supporting its proxy wars in Ukraine and Syria are prime examples as well as recent wars in Iraq and Afganistan. Also allowing endless immigrants into our already overpopulated borders is insane with immense financial costs, politicians only want to hide.

If the debt default causes military spending over Ukraine to tank, I'm fine. If Wall Street pukes because they no longer can count on endless new customers buying all their cr@p and those willing to accept their low wages, fine. The planet can no longer sustain endless human growth and development and our nation already has considerable domestic issues to better focus on.
 

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I will be Very surprised if these politicians reach an agreement by June 1st. Even if Biden and McCarthy find some common ground, the measure would still have to pass in the House and Senate.....good luck on getting those clowns to do anything without arguing for weeks.,

I am strongly considering voting Against All Incumbents in the next election. Perhaps if enough of them get "fired" they might begin to pay; some attention to the general population....but that is probably "wishful thinking".
 
A business report today, noted if the debt limit isn't raised, real estate prices would take a major hit. So now we know a key reason why Wall Street is so worried. For years they've been unfairly devouring we USA working class folk's income through real estate. The current Fed Rate hikes have only had a minor effect on real estate prices with many investors across the planet still eager to jump back into that feeding frenzy as soon as that stabilizes. If it will take a USA debt default to actually decrease our insanely high housing costs, then so be it. Even though I understand little about finance and banking, I'm now hoping the below occurs. And prices drop way more than just 5%.

https://www.foxbusiness.com/economy/who-would-be-hit-hardest-us-debt-default

snippet:
That's according to a recent analysis from Zillow, which projected that homebuying costs could surge by a stunning 22% if Congress fails to raise the debt limit by June 1. On top of that, the 30-year mortgage rate would likely skyrocket above 8%, the highest since the early 2000s, according to the report, authored by Zillow senior economist Jeff Tucker.
 
David777 said:
A business report today, noted if the debt limit isn't raised, real estate prices would take a major hit. So now we know a key reason why Wall Street is so worried. For years they've been unfairly devouring we USA working class folk's income through real estate. The current Fed Rate hikes have only had a minor effect on real estate prices with many investors across the planet still eager to jump back into that feeding frenzy as soon as that stabilizes. If it will take a USA debt default to actually decrease our insanely high housing costs, then so be it. Even though I understand little about finance and banking, I'm now hoping the below occurs. And prices drop way more than just 5%.

https://www.foxbusiness.com/economy/who-would-be-hit-hardest-us-debt-default

snippet:
That's according to a recent analysis from Zillow, which projected that homebuying costs could surge by a stunning 22% if Congress fails to raise the debt limit by June 1. On top of that, the 30-year mortgage rate would likely skyrocket above 8%, the highest since the early 2000s, according to the report, authored by Zillow senior economist Jeff Tucker.
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When I first went off on my own I was told that housing should never cost more than one quarter your income and that's about what people were paying. What happened?


I worked most of my adult life and managed to never rise above minimum wage (always moving) so my SS is pretty much what we used to call pin money, we wouldn't miss it.

Now if the government decided to cut my husband's military pension or the military's most excellent Tricare health insurance -- we would definitely miss that.

Our house is paid for, but if we were unable to pay the taxes, we could still lose it.

We have savings in the bank, but if the banks fail..... hmmm.
 
David777 said:
So now we know a key reason why Wall Street is so worried.
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Wall Street seems to be shrugging this off. Market is up again today despite Congress leaving DC for the long weekend.

I'm starting to wonder if this isn't mostly political posturing and media hyperbole over a situation that'll work out to be little more than a tempest in a teapot.
Y2K suggestions of doom and gloom come to mind.
 
Well, as Brookwood stated yes, We would survive however, our lifestyle would be completely different from what it now is. My wife is also retired from the US Dept. of Agriculture Farm Service Agency. At one time all FSA employees were under a goverment retirement program called FERS, Federal Employees Retirement System. Several years ago, they were offered the opportunity to transfer the funds from their FERS account to Social Security, many, MANY of them did so. My wife had 14/15 years in the FERS program and after studying each of them thoroughly, she decided to remain with the FERS program.

Being the extremely intelligent person she is she explained her reasons for making this decision. FERS has a guaranteed yearly pay raise. As a FERS retiree she has Medicare part A and can obtain part B for a small amount which she did so. Like Social Security, she receives a monthly check for an amount that almost equal's my 2 monthly checks combined. Therefore, we would survive, BARELY!!. Love to you all sincerely, Neal Player.
 
sch404 said:
I started collecting Social Security 14 years ago when I retired at age 67. The total amount I paid into Social Security was $30,681. My employers paid a Social Security contribution for me of $33,537 for a total paid in amount of $64,218. So far I have received total Social Security benefits of $378,891. This is almost six times what I and my employers paid in. And I am still alive. Still collecting money from SS which was never mine to begin with. Now tell me again how Social Security is not both the worlds biggest Ponzi scheme but also the world's biggest welfare program!
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I don't agree with this number. If I assume my average monthly federal withholding over the last 45 years has been $350 then that says my average annual contribution to SSI has been $4200 (12 X $350). Contributing this every year, on average would equal $189,000 (45 X 4200). But since this is my money and the Fed's should not have spent it, it should have been held in escrow and compounding with interest every year. If you calculate that amount assuming an average compounded interest rate of 3% (very conservative) If they held this for me after 45 years the value would be $4,688,963.72...Yep, that is four million dollars! More than enough to pay me my SSI and some left over for other less fortunate.

If any of you do understand or agree details can be found here: https://www.bizskinny.com/Finance/Compound-Interest/compound-interest-with-monthly-contributions.php
of course you will have to put the numbers in the formula...
 
Your numbers are completely bogus!:mad: A principal amount of $189,000 earning 3% compounded monthly for 45 years ends up being $727,826. This is nowhere near the $4.6 million that you claim!! PS: I'm using your interest formula not mine!! The numbers I used in my original post are what SSA has actually reported for my and my employer's year by year SS contributions.
 
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With or without Social Security the wife and I will survive, but both sides responsible for the default will not earn any respect from either of us.
 
The question is "can you survive if SS payments stop"? I would but it would mean some drastic cuts.

But the real question is "are you preparing now for a possible decrease of 20-25% in your SS payments by 2033?". My answer is yes.
 
The answer is yes we would survive. Retirement planning was based on no incoming soc. sec. payments. Even back in the 70's right up to retirement in 1995 fear mongering was a popular political ploy so rather than chance it that there might be some truth to what was being said we planned for no payments.
 
sch404 said:
Your numbers are completely bogus!:mad: A principal amount of $189,000 earning 3% compounded monthly for 45 years ends up being $727,826. This is nowhere near the $4.6 million that you claim!! PS: I'm using your interest formula not mine!! The numbers I used in my original post are what SSA has actually reported for my and my employer's year by year SS contributions.
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Timewise 60+ said:
I don't agree with this number. If I assume my average monthly federal withholding over the last 45 years has been $350 then that says my average annual contribution to SSI has been $4200 (12 X $350). Contributing this every year, on average would equal $189,000 (45 X 4200). But since this is my money and the Fed's should not have spent it, it should have been held in escrow and compounding with interest every year. If you calculate that amount assuming an average compounded interest rate of 3% (very conservative) If they held this for me after 45 years the value would be $4,688,963.72...Yep, that is four million dollars! More than enough to pay me my SSI and some left over for other less fortunate.

If any of you do understand or agree details can be found here: https://www.bizskinny.com/Finance/Compound-Interest/compound-interest-with-monthly-contributions.php
of course you will have to put the numbers in the formula...
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It is important to understand some of the basic concepts about money and interest. A very useful formula is the so called doubling time of money or the "Rule of 72." In this case given an annual interest rate R, the doubling time of invested principal can be computed approximately as T = 72/R. So for an interest rate of 3% the doubling time is seen to be about 24 years. The OP's figures suggest the money in his Social Security account has grown by a factor of about 24 which is more than 4 doubling times (factor of 16 equals about 96 years) and less than 5 doubling times (factor of 32 equals about 120 years). Some people just don't get math!
 
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sch404 said:
It is important to understand some of the basic concepts about money and interest. A very useful formula is the so called doubling time of money or the "Rule of 72." In this case given an annual interest rate R, the doubling time of invested principal can be computed approximately as T = 72/R. So for an interest rate of 3% the doubling time is seen to be about 24 years. The OP's figures suggest the money in his Social Security account has grown by a factor of about 24 which is more than 4 doubling times (factor of 16 equals about 96 years) and less than 5 doubling times (factor of 32 equals about 120 years). Some people just don't get math!
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Had you looked up the webpage I provided you would have found the proper formula to calculate this...

Compound Interest with Regular Contributions Formula​




A = P(1 + r╱n)^nt + PMT((1 + r╱n)^nt − 1)╱( r╱n)



A = Future Value of investment

P = Principle amound invested (the original contribution)

PMT = Regular contributions (additional money added to investment)
 
Leann said:
The question is "can you survive if SS payments stop"? I would but it would mean some drastic cuts.

But the real question is "are you preparing now for a possible decrease of 20-25% in your SS payments by 2033?". My answer is yes.
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My situation is the same as Leann's except that although 70, DH and I still work part time and therefore have an income from our small business, so in a way the answer is yes-ish, I am preparing.

The OP asked about survival if SS payments stop. If they stopped permanently - not just for a few months - DH & I would survive but with severe cuts unless we continued working for the foreseeable future.

A sudden, permanent end to SS is highly unlikely. The US economy would topple, housing and stock market prices would implode, unemployment would soar, and the Great Depression of a hundred years ago would look like a garden party in comparison. Not to mention, all representatives in DC would be swiftly out of work and replaced with people who immediately restored SS.

If SS was delayed for a few months we'll be fine. If permanently cut by 20-25% from 2033 forward, we'd be plenty peeved but would manage ok.
 
Timewise 60+ said:
Had you looked up the webpage I provided you would have found the proper formula to calculate this...

Compound Interest with Regular Contributions Formula​




A = P(1 + r╱n)^nt + PMT((1 + r╱n)^nt − 1)╱( r╱n)



A = Future Value of investment

P = Principle amound invested (the original contribution)

PMT = Regular contributions (additional money added to investment)
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Using your own formula with r = 3% the future value of a regular $350 per month contribution after a period of 45 years is $399,826!! How does this work out to $4.6 million something?? In your dreams, that's how.💩
 
sch404 said:
Using your own formula with r = 3% the future value of a regular $350 per month contribution after a period of 45 years is $399,826!! How does this work out to $4.8 million something?? In your dreams, that's how.💩
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I suggest you check, check, and recheck! Compounding interest is complex, and you have to know how to use the formula provided...I will not lower myself to make comments about you and your knowledge....I will leave that cheap stuff up to you...take you best shot as I will not return or reply!
 
I know how to use the formula! Pray tell us the specific numbers you entered in the specific cells of your website applet to generate the $4.6 million and I will show you and all the world the error of your ways!
 
Myrtle said:
I don't believe this will happen. Not being one of those privileged to discuss politics here, I cannot go into the reasons why it has gotten to this point. But just think of the uproar there would be if SS payments didn't go out. I don't think any politician of any party will want to face that.
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I would be more willing to live where my daughter lives and depend on her or do government assisted living and go to dollare store for food, etc.
 
I could but I'd have to be very frugal.
In fact, when I retired from the military, I was 53 (69 now) and lived on the military pension until I started drawing SS when I turned 62.
After the military I promised myself I'd never work for anyone else again and I haven't. But I had to be very frugal.
The scary part is, the military pension is also government funded.
 
Timewise 60+ said:
I suggest you check, check, and recheck! Compounding interest is complex, and you have to know how to use the formula provided...I will not lower myself to make comments about you and your knowledge....I will leave that cheap stuff up to you...take you best shot as I will not return or reply!
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OK, I'm afraid time's up Mr. Timewise 60+! I asked you simply to prove your preposterous claim by actually showing us your calculations. Fact is you can't do it! One of the perverse joys of being on these forums is watching arrogant, misguided people drown in quicksand of their own making.
 
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