Missed blogging yesterday, had to get that tax return in. Then read this--
The average household pays $21,992 in Federal taxes. That is a pretty misleading number but we will go with it for simplicity's sake. The government spends $24,106 per household which means, I guess, we got a deficit. That can wait for another day. Where does that money go?
It goes to--
Social Security $8,301
Anti-Poverty Programs $3,550
$2,071 Interest on Federal Debt
$9,07 Federal Employee Benefits
$664 Health Research and Regulation
$627 Veteran's Benefits
I don't know if these numbers are real or made up but call the Heritage Foundation if you have a question.
Also, don't really want to talk about all those numbers. I have no problem with the defense numbers especially since it is paying my son's salary and hopefully keeping the planes of the 96th Bomb Squadron in good enough shape to stay in the air.
The one that bugs me is Social Security and it should bug you more than me. Take a look at your paycheck and don't be surprised if you pay more in Social Security (labeled as FICA on your paycheck) and Medicare tax than you do in Federal tax. According to one survey most of you think you have a better chance of going to the moon than getting paid Social Security when you retire. I think you may be right.
And here is why. If the guy running Social Security was working for a private company he would soon end up in jail because he is committing fraud. He (or she) is paying off liabilities with today's revenues. In other words, retirees are not getting the money they paid in. They're getting your money. You pay it in and the government pays it out. But wait a minute, that's my money you say. Of course it is but the retirees money got paid out a long time ago so if the government is going to pay them, and they are, they need the money now so they take yours. In finance and legal circles that is known as a Ponzi scheme and it is illegal.
But there is a Social Security surplus you say. You've read about it and it is going to run out sometime in 2040 or so. Sorry, the 'surplus' you read about is already being spent. It is being 'loaned' to the Federal government to meet other current needs. Isn't that illegal or at least unethical? If a private company did it probably but we're talking the Feds here. A short history lesson--there used to be a real Social Security surplus. It was outside the Federal budget. But it seems Lyndon Johnson was facing a bit of a shortfall because of Vietnam and the Great Society so he 'borrowed' the Social Security surplus and, amazingly enough, balanced his budget. It's been 'borrowed' ever since.
But anyway, how are you going to get your Social Security money back? I don't know. Either write it off or hope there are a bunch of young workers out there when you retire. Because remember, your money will be long gone to the old geezers that are collecting now and for the time before you retire. Or vote somebody in that will solve the mess. George tried and look how far he got.
The best thing to do is write it off and save for yourself. When it comes to personal finance, finance truly is personal.