The Plan
Social Security can be funded by cost-effective, private insurance, and gradually transitioned into a totally privatized program — beginning as soon as possible.
Here’s how:
Insurance companies have retirement policies that can feasibly and cost effectively replace Social Security.
A policy for an 18-21 year-old, would cost $800 per year and pay a monthly pension of $2400 beginning at age 65 with a death benefit of $5,000. (This is a retail quote, and does not take advantage of group rates which would be substantially lower.)
This policy takes into consideration more than 100 percent inflation and extended life expectancy to age 87.
Today, a person earning $30,000 — the mean average salary — pays $3,780 annually to Social Security. The current payments average about $1,000 per month.
An insurance company will take $800 for the private pension, leaving $3000 to pay the current retirees. This retirement program would be entirely privatized within 25 years. For now, Social Security deductions would remain the same with retiree benefits to be phased out in 25 years.
Does this make sense?
This would be a mandatory minimum policy with the option to increase one’s retirement benefits by simply increasing the premium.
This is a PROVEN method of funding retirement. The County of Galveston, Texas has successfully funded their retirement plan this way after opting out of the Social Security program more than 18 years ago. The federal government does not allow this anymore and changed the law.
Why?
The government does not want the public to pull out of the Social Security system which would go broke quicker.
Insurance companies would be covered by an FDIC-type insurance to cover insolvencies (and paid for by the insurance companies), as are banks.
Insurance companies will be reinvesting into the U.S. economy daily, including mortgages, real estate, treasury bills, stock market, much as insurance companies do now but on a much larger scale.
Insurance companies will be fueling the economy on a daily basis.
Sounds almost too good to be true…but it is not. Check out the Galveston County story.
This generation is the selfish generation, collecting now and leaving the crumbs — if any — for young people.
The U.S. government — any government — is not run as an efficiently as a business.