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No more so than paying health insurance and never needing a major procedure.. the money goes into the pool for those who need it. It was not meant to be a retirement savings plan, it was a social safety net, therefore more like insurance than tax.



SS has been a defined benefit retirement plan for over 30 years now, nothing to do with insurance. True it wasn't originally designed that way but that is ancient history. Defined benefit is what all the protesting was about in Wisconsin earlier this year by all the public employee unions. That means they promise you by law that you will receive a set amount each month once you retire according to a simple formula. Anyone over 50 gets those SS benefit statements every year and while they're not accurate to the last dollar, they are pretty close projections as to what you will receive. Contrast that to what most people have now, a defined contribution 401K plan. That means your employer guarantees they will match either 100% or a percentage of what you decide to put into their retirement plan each year. No guarantees as to what the eventual monthly payout will be, that is decided by the market the funds are invested in. Defined benefit plans are a recipe for disaster as we're seeing now because when people retire at a time when the plans have lost 20-30% or more due to the economy there's not enough cash in the system to pay all the current retirees.

For the most part the only defined benefit retirement plans left are for government employees, including Congress and Social Security. I hate to say it because it's really gonna suck eventually but we just can't afford those types of plans any more which is why very few large private employers still have them.

Bob

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