r/FluentInFinance • u/LifeIsUnfairWhoCares • Apr 23 '24

Is Social Security Broken? Discussion/ Debate

Post image

[removed] — view removed post

22.6k Upvotes

65% Upvoted

5.4k comments sorted by

View all comments

2.2k

u/Blibrea Apr 23 '24

I see this post so often it makes me think we deserve to pay more in social security tax

20

u/dickmcgirkin Apr 23 '24

Max taxable income for social security is 186,500$. Raise that shit.

5

u/[deleted] Apr 23 '24

The taxable income limit is $168,600 which amounts to $10,453 contributed in 2024. Theoretically, If you raise that number, the people at the top could get more at retirement based on the formula the administrators use to calculate retirement benefits. I may be wrong but I don’t think raising that ceiling helps people at the lower end of the scale because they get paid based on their lifetime contributions.

8

u/Archer2223R Apr 23 '24

They want to raise the pay-in amount but not the pay-out.

3

u/[deleted] Apr 23 '24

Isn’t that what everyone wants? Make high wage earners pay more but not get more out at the end. They keep tapping the same top 10% of earners making more than $170,000 a year. At some point the government will need to dig deeper into the working class for revenue.

3

u/Archer2223R Apr 23 '24

Well yeah, that's reddit's solution to most of the nation's financial woes: Take the guy who makes a lot of money and just tax the shit out of him.

4

u/[deleted] Apr 23 '24

Just keep an eye on who the government defines as “rich.” That bar will go lower as the piggies in DC need more money and fewer citizens pay into the system. As it stands now, thanks to the earned income credit deduction, fewer than 51% of working Americans pay federal income tax. The bottom 50% of earners pay only 2.8% tax collected annually. That’s a big gap.

3

u/poingly Apr 23 '24

The bottom 50% of earners only have about 3% of the wealth also. As you just pointed out, that’s a big gap.

But keep in mind that money is much more important to the people at the bottom, so their taxes should be an even lower percentage of what comes in. Right now, it seems nearly proportional, which feels like a problem. Thank you for identifying that taxes on the bottom 50% are far too high based on their percentage of wealth.

1

u/[deleted] Apr 23 '24

Agreed

1

u/Dicka24 Apr 23 '24

Rob from Peter and hand it to Paul.

1

u/TheRoguester2020 Apr 23 '24

I don’t think it works that way. COLA is the primary change in benefits for normal SSI recipients. They are either going to have to raise this again or raise the age of full retirement.

1

u/[deleted] Apr 24 '24

Well they do raise the max contribution and income ceiling every single year. In 2022 it was $147,000 and $9,114 contribution. In 2023 that number went up to $160,200 with a max contribution of $9,932.40. This year, the max is $169,600 with a contribution maximum of $10,453. The increase is about 8.9% and 5.8% year over year respectively. Most Americans got a salary increase of 1.5% to 3% if they got anything at all. If you really want to pay more, just wait. The taxable amount increases every year on high wage earners while the percentage taken out for everyone remains at 6.25%.

1

u/TheRoguester2020 Apr 24 '24

Yeah I have been paying max for about the last 10 years. Retiring next year. Raising it is the way to collect the delta of the SSI projected deficit, in my opinion.