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Joined 1 year ago
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Cake day: June 15th, 2023

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  • Apologies, but your specific example is incorrect. The cap on social security taxes is adjusted every year not by act of congress, but by existing law that indexes the cap to inflation. Therefore, it is already baked into the way it is scored and is not ignored.

    You are correct that scoring cannot take into account any actions congress may take.

    This time is a little different though than history. From 1984-2020, Social Security took in more in revenue than it paid out on benefits. It is now running at a deficit. Since being formed, it has run at a deficit less than 15 total years, and most of them earlier on. The social security trust fund has never been depleted during that time either. Without any changes to law, it will continue to run at a deficit until the late 2030s when the trust fund would be depleted and taxes alone would cover a projected 80% of benefits.

    That 80% is why it’s bullshit to your point. There are so many simple, easy ways to solve this and if they do nothing, we could continue to pay out 80% of benefits with no other changes but that’ll never happen. It would be political suicide to literally starve our retired population. My favorite way to address it is removing the cap, but there’s other small adjustments that make a huge difference. Things like changing the inflation adjustment to a similar but lower index, raising the retirement age, raising the tax by less than a percent, means testing, etc … and the thing that pisses me off is the sooner we take one of these actions, the more of the trust fund is preserved, and the impact is so much greater. I don’t like the other solutions and would strongly prefer raising the cap, but I’d take most of them over inaction, depleting the trust fund, and reducing benefits.





  • Welcome to a life of investing. I started investing in '08 and everything that was a once in a generation crash. And in '10 when the market recovered, so many thought it wasn’t real. And as the market kept going up '11-'15, so many kept claiming the crash was coming so it was smart to change your investments. I saw so many run for the hills in the dips in '15 and '16 and then completely miss the run up over the next few years. I have some colleagues that panicked following the COVID19 dip, and never got back in and missed the recovery and new all time highs.

    The truth is your entire lifetime of investing, it will always feel like this time is different. This time it’s obvious we’re about to crash or it’s obvious we’re about to go on a run or it’s riskier than it’s always been. I’m not going to tell you the market is going to be up in the next year, or next five years, or next ten. But since the late 1800s, a great strategy has been to just keeping investing over time and not trying to time the market.

    Initially, your swings of hundreds of dollars will keep you up at night, but if you keep at it, eventually those swings will be in the thousands or tens of thousands and you’ll be able to handle them better. I can’t promise you you’ll win with this type of set it and forget it strategy, but there has yet to be a period of a couple of decades in US History than you haven’t ended up a winner if you have that long term horizon.