Is there a legit argument for privatization of social security?

I am closing in on retirement, my goal has been to retire at 60. I did a little math over the weekend, I have 20 years with the company I work for and started a 401 when I started work there. The company put 3% of my salary in a 401 and matched 50% of my contribution up to 6%. So, for 20 years my account has gotten 12% of my salary. I used the calculator from the manager of my account to calculate my monthly cash flow from the account if I retired at 60 years of age. It came out to about $3300 a month. I then went to the SSA website and looked up what my social security would be at 62 years old, the earliest I can get any benefit. Keeping in mind that 6.2% for SS and 1.45% for medicare is a shade over 7.5% of my salary and the employer has to pony up another 7.5% for a total of 15%, or, 25% more than is contributed to my 401. If I start drawing social security at 62, my monthly check would be about $1700. The government has been collecting an amount equal to 15% of my salary for almost 40 years, twice as long as I have been putting a lesser amount into the 401. Not only has the government squandered the money they have taken, they threaten to further reduce benefits because of their poor investments. Then they are going to tax me again on the money they give back to me.I really can't see a reason not to push for privatization, future generations would benefit greatly if the government wasn't "holding their money" for them.

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Picklebobble2 · 56-60, M

No. Privatisation assumes there's a profit to be made.
And as we all know if you follow the stock market,all you need is an extended period of economic hardship and it can all turn to dust !

Quite what the answer is I don't know.

Roadsterrider · 56-60, M

@Picklebobble2 The longest downturn was the great depression, that was 10 years, it would only affect those who retired right before or during the downturn. Any investment like that is a long term proposition. During the recession of 2008, I watched my 401 drop by about 60%, after a few years, it was back to normal and growing. If you have 100 shares in a stock and the market drops, you still have 100 shares, they are just worth less till the market picks back up. I just can't help but think that if all the cash that the government got from my pay was invested properly, I would be a wealthy person when I retired.

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Roadsterrider · 56-60, M

@pismo I didn't know enough to even think about it when I was younger. I try to tell my kids now, start a 401 and don't cash it out when you change jobs, just roll it over.

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Picklebobble2 · 56-60, M

@Roadsterrider And yet the ONLY TWO consistent safe performers in ANY investment period are either Government Bonds or National savings.

Interest rate is never 'high' but it does secure your money.

Monkeying around in the stock market, again, ASSUMES the investor on your behalf knows what they're doing and when to withdraw and re-invest elsewhere.

If they were sat at a Blackjack table would you still trust them with it ?

Picklebobble2 · 56-60, M

@Roadsterrider Assuming the companies invested in don't go bust in the meantime !

Roadsterrider · 56-60, M

@Picklebobble2 No, I wouldn't trust them at a blackjack table, but, that isn't what they are doing with the money either. The history is there for any investment firm for as long as they have been doing business. When the account is set up, the owner of the investment decides how he wants his plan set up initially. I wanted my plan split 50% in stable returns, 25% moderate risk and 25% high risk. My plan is through T. Rowe Price and it has averaged 11% for the last 20 years. I assume it will continue to do the same for the next 7 till I retire. The recession of 2008 caused a loss of about 60% of the cash value to my portfolio, but in 1-2 years, it was back up to previous levels and has continued to grow. If the nation entered a long recession or a depression, do you really think that social security will remain solvent till 2040? The government will be collecting less and dispersing less.