Millionaires No More

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How Social Security is Impoverishing Our Seniors

by Thomas R. Eddlem

Imagine you win your state lottery for $1.1 million. You have the option of collecting the cash prize of $1,100,000 or taking $55,000 per year in twenty annual installments.

Your financial advisor will always tell you the smart move is to take the full cash payout and invest the money in a stock index fund earning interest and dividends. If you do that, you can take out seven percent after taxes in perpetuity with adjustments upward for inflation and on average never lose any principal.

But what if the state lottery came in and changed the terms of the deal? Instead, you have to wait a few years to accept $20,000 per year in $1,700 monthly installments. And if you die, the lottery keeps all the remaining proceeds except a cancellation/consolation payment of $255. And they tell you it’s a much better deal than getting $1,100,000 in cash.

That’s Social Security for the average American worker today.

The statistically average American worker retiring this year will have paid out …

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