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Can you afford to get old?
April 12th, 2012
04:00 PM ET

Can you afford to get old?

FROM CNN's Jack Cafferty:

Can you afford to get old?

In case you weren't already worried about your retirement, now comes word that it's getting more expensive to get old.

The International Monetary Fund says people around the world are living three years longer than expected. That's increasing the cost of aging by 50% - and governments and pension funds aren't ready for it.

Reuters reports the IMF study, coming out next week, shows that longevity is a bigger risk than previously thought.

Researchers say that if everyone in 2050 lived three years longer than now expected, society would need extra resources "equal to 1 to 2% of GDP per year."

In the United States alone, an extra three years of life would add 9% to private pension plan liabilities.

Life expectancy in the United States is approximately 78.5 years. According to the CIA World Factbook, the U.S. ranks 50th worldwide. At the top of the list is Monaco, where people live an average of almost 90 years, followed by countries like Macau, Japan and Singapore.

As medicine improves and standards of living go up in some of the developed countries, people continue to live longer. The IMF is calling on governments and the private sector to prepare now for those longer life spans.

Governments' options are fairly limited. Raise the retirement age, raise taxes to fund public pension plans, and lower benefits. A lot of countries are already considering doing all of this to tackle crippling national debts.

Another step governments could take would be to educate people on how to better prepare for their retirement.

Here’s my question to you: Can you afford to get old?

Tune in to the Situation Room at 4pm to see if Jack reads your answer on air.

And, we love to know where you’re writing from, so please include your city and state with your comment.

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Filed under: Longevity • Money • On Jack's radar • Social Security
Do you think Social Security will be there for you when you retire?
February 16th, 2012
01:43 PM ET

Do you think Social Security will be there for you when you retire?

FROM CNN's Jack Cafferty:

If you're planning to rely on Social Security in retirement, you may want to think again.

The Social Security Administration has already warned that the trust fund will likely run out of money in 2036. That's only 24 years away.

But now there's reason to believe it could run out of money even sooner.

The Congressional Budget Office says by 2020, the combined Social Security old age and disability trust funds will be $800 billion smaller than what the Social Security Administration projected last year.

AOL's Daily Finance suggests when the next SSA Trustees Report comes out, its own projections will probably be revised downward too.

In fact, that's been the trend over the past five years, with Social Security moving up its estimated "run-dry" date from 2041 to 2036.

When the trust fund runs out of money, it's expected benefits will fall by about 25%.

So if you still have time to put away additional money for your own retirement - not an easy thing to do in this economy - you should save up.

More than 54 million Americans collect Social Security for retirement, disability or survivor benefits. The average check for a retiree is about $1,200 per month.

Meanwhile Treasury Secretary Timothy Geithner says the White House and congressional Republicans discussed ways to shore up Social Security last year as part of the debt ceiling talks.

But, big surprise - they couldn't reach a deal.

Lawmakers would either need to cut benefits, raise taxes, or a combination of the two. Won't happen - at least not now.

Here’s my question to you: Do you think Social Security will be there for you when you retire?

Interested to know which ones made it on air?

FULL POST

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Filed under: Social Security
Is Rick Perry right to call Social Security a Ponzi scheme?
September 13th, 2011
05:00 PM ET

Is Rick Perry right to call Social Security a Ponzi scheme?

FROM CNN's Jack Cafferty:

Rick Perry went there. The Texas governor has electrified the third rail of American politics by wading into a debate on Social Security.

Unless you've been hiding under a rock, you know Perry has referred to the program as a "Ponzi scheme," "a monstrous lie," and a failure.

Social Security is perhaps the federal government's most popular program. Millions and millions of Americans rely on it as they reach retirement age. By calling it a Ponzi scheme, Perry is implying that the American people are being duped by a massive fraud.

And those are fighting words - which is probably why Perry is walking back his comments a bit.

In Monday night's debate, Perry said it's time to have a legitimate conversation about how to fix the federal program so it's not bankrupt. And in an op-ed he wrote Monday, there was no mention of a Ponzi scheme.

Here are the facts: Social Security is broken. The program will keep paying out 100% of benefits promised until about 2036. After that, if nothing is done, it would only be able to pay out three-quarters of benefits.

What's more, there were only 1.75 full-time private sector workers last year for each person receiving Social Security benefits.

Perry suggests a way to fix the program might be to raise the retirement age, or introduce a "means test" to limit payments to the rich. In the past, he's also advocated the privatization of Social Security.

Meanwhile, the other Republican candidates, especially Mitt Romney, sense a weakness here and are pouncing on Perry over the Social Security issue. Romney calls Perry's language "over the top."

And it seems that most Americans agree. A new CNN/ORC poll shows only 27% think Social Security is a lie and a failure. However, an overwhelming majority believes that changes are needed.

Interested to know which ones made it on air?

FULL POST

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Filed under: Gov. Rick Perry • Social Security
February 24th, 2011
05:00 PM ET

Cut Social Security, Medicare, Medicaid to attack the deficit?

FROM CNN's Jack Cafferty:

Early Saturday morning, the House of Representatives approved more than $60 billion in cuts in federal spending. It was the first sign Republicans are trying to make good on campaign promises to close deficits and slash government spending.

But before they break their arms patting themselves on the back, it's worth pointing out that $60 billion is less than 3 percent of this year's deficit, projected at more than $1.6 trillion.

The bill cuts federal funds to Planned Parenthood, the Environmental Protection Agency, and education programs like Pell Grants and Head Start. What it doesn't touch is Social Security, Medicare or Medicaid which account for 57 percent of the federal budget this year. So far, not a single dime has been cut from any of those programs.

According to a recent CNN/Opinion Research Poll, more than half of Americans think the deficit is "extremely important" for the President and Congress to tackle. However, when asked what was more important: reducing the deficit or preventing cuts in Medicare, 81 percent said preventing cuts to Medicare while just 18 percent said reducing the deficit. When asked about Social Security, 78 percent said preventing cuts to that program was more important than lowering the deficit. And when asked about Medicaid, 70 percent said avoiding cuts to the public health insurance program for low-income families was more important, compared to 29 percent who said closing the deficit was more important.

So at the end of the day it's not just the federal government that's at fault here. As the line in Pogo went, "We have met the enemy and it is us." Politicians know senior citizens are among the most consistent, reliable voters in this country, and it's a real risk to propose cuts to programs many of them depend on... especially as we approach the 2012 presidential election.

Here’s my question to you: Should the government cut Social Security, Medicare and Medicaid in order to attack the deficit?

Interested to know which ones made it on air?

FULL POST


Filed under: Health care • Social Security
November 30th, 2010
04:40 PM ET

Denying Social Security for people earning more than $150,000?

FROM CNN's Jack Cafferty:

As we await the final recommendations from President Obama's deficit commission, one Democratic-led policy group is out with its own bold proposal:

Bloomberg News reports that the think tank Third Way wants to trim or eliminate Social Security benefits for what they consider high-income retirees.

The plan is to boost monthly benefits for poorer retirees - while reducing them on a scale starting with individuals who have $150,000 in outside income or couples with $250,000.

Social Security benefits would be eliminated all together for individuals making $200,000 or couples with $400,000 in income. The group says people who don't need Social Security shouldn't get it.

This is despite the fact that these people have paid into Social Security throughout their working lives.

Third Way also wants to raise the retirement age, limit cost-of-living increases and help young workers create private retirement accounts.

Third Way says its proposal will come out after the deficit panel's report and is meant as a kind of cover for Congressional Democrats to support unpopular deficit-cutting measures.

Republicans have argued for raising the retirement age as well as limiting benefits for wealthier retirees. But most Democrats don't want to touch Social Security at all - when it comes to cutting the $13 trillion plus debt.

However, some Democrats do support cutting benefits. As Senator Kent Conrad put it: "Those who say don't touch it aren't dealing with reality."

As for that deficit commission, like we said yesterday here in the Cafferty File, don't bet on it. The panel now says it will delay the vote that was set for tomorrow until Friday, although they still plan to release the report tomorrow.

Here’s my question to you: Should people earning more than $150,000 be denied Social Security benefits?

Tune in to the Situation Room at 6pm to see if Jack reads your answer on air.

And, we love to know where you’re writing from, so please include your city and state with your comment.


Filed under: Social Security
September 8th, 2010
06:00 PM ET

What's the right age to retire?

FROM CNN's Jack Cafferty:

The French are not happy with their government's plan to raise the retirement age from 60 to 62.

More than a million people in 220 French cities took to the streets yesterday protesting - with strikers disrupting trains, planes, hospitals and mail delivery.

Yet French President Nicolas Sarkozy is vowing to push ahead with the overhaul of the country's pension system. You see, France and many other European countries have come to the realization that if they don't do something about their troubled fiscal situations now - they risk winding up in the same boat as Greece.

But don't tell that to the French union workers, who are a bit dramatic about the idea of working until 62.

One sign in Paris showed a raised middle finger with the following message: "Greetings from people who will die on the job."

The French government is telling them things could be worse. Other European countries are thinking about raising the retirement age to 67 or 68. And here in the U.S. the retirement age is gradually going up to 67.

Meanwhile as the French complain about working until 62, a growing number of Americans are working into their 90s and even 100s.

Experts on aging say a daily job can help alleviate boredom, improve physical health and provide older people with a schedule. Some of them are working to supplement their retirement savings or to give extra money for their families

AARP says by 2012 almost one-fifth of the workforce will be older than 55, and baby boomers will likely keep working beyond the traditional retirement age of 65.

Here’s my question to you: What’s the right age to retire?

Interested to know which ones made it on air?

FULL POST


Filed under: Social Security
July 21st, 2010
06:00 PM ET

Do you think Social Security will be there for you?

FROM CNN's Jack Cafferty:

For the first time ever 60 percent of American workers don't think they will get any Social Security when they retire.

A USA Today/Gallup Poll shows six in 10 Americans who haven't retired yet say there will be nothing for them when they stop working.

That's the most pessimistic outlook since the question was first asked more than 20 years ago.

Younger Americans are least likely to believe they'll one day get Social Security... while those older than 55 are confident they will get benefits.

A majority of retired Americans think their benefits will be cut. Which is especially troubling when you consider that 54 percent of retirees say Social Security is their major source of income - more than any other single source.

Our government has yet another crisis on its hands, one that's been coming down the tracks in plain sight for years - yet it's not being dealt with.

Already this year Social Security will pay out more in benefits than it collects in contributions. Plus there's the whole issue of the "trust fund"... which is filled with nothing more than IOUs.

Social Security monies that are collected are siphoned off into the general treasury and spent on other things.

With a high unemployment rate, people retiring earlier than expected… and more and more baby boomers getting ready to retire, something's gotta give.

Is anybody listening?

Here’s my question to you: Do you think Social Security will be there for you?

Interested to know which ones made it on air?

FULL POST


Filed under: Social Security
May 4th, 2010
05:00 PM ET

What should be done to fix Social Security?

FROM CNN's Jack Cafferty:

Americans need to accept the fact that Social Security is already broke.

That's the sobering bottom line in an article on AOL news. The piece suggests that the Social Security crisis - that's been talked about for years - is already upon us. This year Social Security will pay out more in benefits than it collects in contributions.

Experts have been warning that the annual surpluses for the trust fund would eventually shrink to zero. A deficit was inevitable - in part because of the growing number of retirees and the fact that relatively fewer workers now support them.

But, because of the nation's high unemployment rate and people retiring earlier than expected... the system is already in the red.

And things could get worse... much worse. If the economy suffers a "double dip" recession like some fear... Social Security may never be in the black again.

There's also the whole issue of the "trust fund" - which is nothing more than an accounting gimmick. Defenders of the system say there's no emergency because of this $2.5 trillion fund... they say the system will be solvent until 2037.

But that's a joke... you see this fund is filled with nothing more than IOUs... Instead of investing the money from the years of surplus, the government raided the fund and spent it elsewhere. Which means we, the taxpayers, are on the hook once again.

Of course, at the end of the day... there aren't many options. This crisis calls for our gutless politicians to make the tough decisions to either raise taxes or cut benefits. Don't hold your breath.

Here’s my question to you: What should be done to fix Social Security?

Interested to know which ones made it on air?

FULL POST


Filed under: Social Security
February 5th, 2010
05:00 PM ET

How to handle gov't squandering Social Security surplus?

FROM CNN's Jack Cafferty:

First it was the banks and car companies... and now it looks like Social Security is the next in line for a taxpayer bailout.

A man dressed as a Social Security card demonstrates in front of the Capitol Building.

A man dressed as a Social Security card demonstrates in front of the Capitol Building.

Fortune Magazine's Allan Sloan writes that for the first time in 25 years - Social Security is taking in less than it's spending on benefits.

That's because For decades - the government has been using the surpluses from the nation's largest social program to pay for other things; and now Social Security is running out of money and pretty much consists of IOUs.

Sloan points out that no one has officially announced that Social Security will be cash-negative this year; but it becomes clear pretty quickly when looking at a report from the Congressional Budget Office.

This is outrageous - another bailout looming on the horizon because the government mismanaged these surpluses. And because there's no surplus, there's no interest income - tens of billions of dollars that are nothing more than a bookkeeping entry because the cash, which would earn that interest, is gone. replaced by IOUs.

Things haven't been so bleak for the government trust fund since the early 80s - when it came very close to running out of money. Back then, the government wound up trimming benefits and raising taxes - which led to the significant cash surpluses.

Meanwhile Social Security already provides more than half the income for most retirees; and with millions of people seeing their home values and stock portfolios slashed, this probably means they'll become even more dependent on social security in the future.

Here’s my question to you: What should be done about the government squandering the Social Security surplus?

Interested to know which ones made it on air?

FULL POST


Filed under: Government • Social Security
December 18th, 2009
04:00 PM ET

Federal agencies get 10% budget increase while people on Soc. Security get none

FROM CNN's Jack Cafferty:

It happened quietly at the White House this week - almost like they didn't want us to notice:

President Obama signed a $1.1 trillion spending bill which increases budgets in many federal agencies by about 10-percent.

The bill includes almost $450 billion for the operating budgets of different departments. Among those seeing increases: The FBI, the Veterans Health Administration and the National Institutes of Health.

Democrats say this spending is critical in order to help the economy out of the recession. But Republicans are slamming what they call out-of-control spending - and criticizing about $4 billion going to more than 5,000 earmarks requested by individual lawmakers.

Doesn't exactly sound like the change President Obama promised, does it?

One watchdog group says the earmark projects include the construction of a Kentucky Farmer's market, the renovation of a historic theater in New York and the restoration of a Rhode Island mill.

The bill also approves a 2 percent pay increase for federal workers.

Meanwhile the 50 million Americans receiving Social Security won't be getting any increase next year - for the first time in more than 3 decades.

So nothing for the country's seniors... but there's always money for more government.

Here’s my question to you: Do some federal agencies deserve a 10-percent budget increase when people on Social Security get no increase at all?

Interested to know which ones made it on air?

FULL POST


Filed under: Social Security • Uncategorized
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