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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sarabee1995 · 26-30, F

Interesting post. I don't know a whole lot about social security, but I do know that once it starts paying, it pays forever, right? In your 401, did you calculate the payment assuming you'd live only to 80? or 90? or 100?

My grandfather died at 70 and only took a few years of social security, but my grandmother died at 82 and had been taking it for a while. If they had both lived to 100, they would have continued getting their check the whole time.

Roadsterrider · 56-60, M

@sarabee1995 With a 401, you have a maximum sustainable rate. If you pull out "X" amount per year, it should regenerate and in theory last as long as you live. There are mandatory withdrawal limits established by the regulations of the government so there may be an problem with what you need to withdrawal and what the government requires you to withdrawal.

Yes, social security lasts until you die, the payments are considerably less than that of a lesser funded 401 though. I ran my numbers through the SS website and for the almost 40 years I have been with working they have pulled 15% of my salary, half from me and half from my employer, and my benefit at 62 will be about $1700 a month. Contributing 12% to a 401 will net me more than twice that amount and I have only contributed to the 401 for 20 years. Twice as long and more of an investment with much less of a return, that was the reason for the initial question.