by Sean Davis

Created on: October 12, 2007   Last Updated: January 27, 2010

Social Security Reform and Plan
(basically make it quasi-public like the federal reserve)

Social Security as it stands right now is barely capable of doing what it was designed to do with the amount of people on it as long as the federal government uses it as a piggy bank whenever the government is strapped for cash. Unfortunately it is going to get worse due to the fact that with in the next decade or so in this country the baby boomers are going to be retiring. This means that even if the federal government stops raiding Social Security now the government will not have the money to pay the retires the money owed to them.

With in the next few years the Social Security Administration will start seeing a real short fall in money being paid into the system while seeing a marked increase in the money being paid out to people that will undoubtedly be mostly retirees requesting retirement services from the system.

This country has only been open to bringing about change when the problem comes to bite the government in the rear so to speak. The nation as a whole has to stop the politicians in the federal government from becoming complacent with such issues like social security by forcing the issue on them so they know where their constituents stand when it comes to such issues.

It is important to protect the Social Security Administration if at all possible with out privatizing the Administration. The best way is to get people involved in where their money is going after they pay into it.

Suggestions:

1. Set up the Social Security Administration and all of its parts so that there cannot be any money withdrawn from Social Security that isn't Social Security Administration related.

2. Have people that are currently working directly with and that have a proven track record in the financial community as bringing retirement plans in line with the economy effectively without overtaxing the money involved.

3. Find actual ways of stemming the flow of wasteful spending that is taking money away from the system and the people that actually need the money without compromising the quality of service or the amount of service that the Social Security Administration offers. This should be done even if it means taking some or all of the bureaucracy out of the system. Moreover, wasteful spending can be stemmed by streamlining the way paperwork is done without compromising the system or the money being paid to the Social security administration and paid out by the social security administration.

4. Institute a tax rider that would be part of the overall social security tax but instead of it being based on an individual's income, have it based on the amount that the individual already pays into the system.

5. Using only the money from the tax rider, fund new ways of bringing in money for the system in various ways.

Here are some ideas on how to invest the money:

1. After taking the above steps invest all invest all of the traditional tax in ways set up using the above steps.

2. The money being brought into the system due to the rider split it equally between stocks and bonds.

3. All of the money earned in the bond market stays in bonds; half of the money earned in stocks gets reinvested into bonds and the other half gets reinvested back into stocks.

4. The types of stocks that should be invested in should pay a dividend, should have a good track record of keeping their values and have a tendency of splitting after reaching a certain price range.

Learn more about this author, Sean Davis.
Click here to send this author comments or questions.