THE NEW SOCIAL SECURITY

The problem with social security aside from being insolvent is it's a social welfare program instead of a savings program. It's pyramid scheme that is about to end. It needs to be fixed and not just patched. The goals of any restructring should be long term solvency, ownership, and savings. Here is how I would restructre the plan for NEW RETIREES.

• Add up, calculate all the money someone has ever actually put into the plan. THAT IS THEIR MONEY. When they die it gets inherited.
• No spouse payments/payouts. They get their inheritence. They have their own money if they have worked.
• Payout is calculated by dividing up current amount by years and months until you reach 85.
• You can take money out due to medical emergency.
• When your money is depleted (you live a long time, med emergency) you are placed into welfare at perhaps a lower rate. Current retirees continue receiving their money.
• You have a choice where your money gets invested in only a GUARANTEED vehicle. Federal bonds, state bonds, or CD's (you choose the bank). Guess what, we have a choice whether to fund washington, our own state or a bank which will lend the money out. People will naturally have some variation of return.
• A tax is applied to simply pay for those who don't have money or who run out, ect. 1-2%
• Limits of taxation are raised to 150K/300K married.
• Allow people to save more then 7.5 / 15% currently. Whatever they save over that amount is tax free (not just tax deferred, TAX FREE) up to some % and some $$$ amount.

This will take away the advantage of early retirement because your money doesn't disappear. It will allow people another vehichle besides 401K's. It wil provide people with a safe safety net and allow people some choice and therefore some control on who gets to do what with the money.