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Social Security Pros And Cons

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Social Security is a federal insurance program that provides benefits to retired people and also those who are unemployed or disabled. Social Security consists of three programs retirement, disability and survivors. Social security is funded by a payroll tax. According to the article “How is Social Security Financed” the payroll tax makes the employers and employees each pay 6.2 percent of wages, while the self-employed pay 12.4 percent. This payroll tax is deducted from an employee’s paycheck.
In the Social Security system the money that is deducted from the payroll tax goes into the system immediately. Once it is in the system is it paid back out to the people who are currently getting Social Security checks. It is a cycle, the younger working …show more content…

Some pros to having Social Security replaced is that the induvial has more control of its retirement fund then they will with Social Security. Private funds make Americans capable of making their own decisions about how their retirement contributions are invested. If Americans invest in private funds they are investing in private capital markets which can produce net increase depending on how the government handles the transition of Americans replacing social security with trust funds (Tanner). Although, private funds sound like a good replacement for social security “many people lack the basic financial literacy to make wise investment decisions on their own” (Privatizing Social Security). Social security has started to face many financial difficulties over the years and resorting to private funds would actually make the social security problem worse. Another con to replacing Social Security is that gives the person responsibility of having to make a retirement plan and being able to make investment. Many people are not capable of such decisions and many will be taking an investment risk. I support replacing Social Security with private funds because as I mentioned earlier “instead of sixteen workers paying in for every beneficiary, right now it 's only about three workers” (Reno) for social security to function to its full potential the ratio would have to be sixteen to one but the number is much less than that its only three to one and the ratio will only continue to fall. As baby boomers begin to retire it is causing the social security system to face difficulties since the baby boomers generation will be a big number of people retiring that the working class will not be able to support them (Reznik, Shoffner,

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