Help me battle my teacher's indoctrination

[Seether]

The other class he teaches is an introduction to foreign relations class. I am not trying to get him fired, but I would like for some of my classmates to understand that maybe they shouldn't take his words as gospel simply for the sake that he is a teacher (which I feel many do).

He happens to be Hungarian and immigrated many years ago, so I feel that his roots likely have a huge effect on his opinions.

[PLOlover]

SS is a good question.

can I answer this. first in dollars then in inflation adjusted dollars maybe.

a guy works and pays SS from 1960-90, retires and draws benefits from 1990-2005, then dies.

how much he pay in at max rate? min rate?
how much he draw out if he paid max? min?

single?married?

in actual dollar amounts? in inflation constant dollars?

[PLOlover]

not sure if this is in inflation adjusted dollars.

http://www.heritage.org/Research/feature...;CL_FIRSTTIME=1

[ QUOTE ]
You can expect to pay $290,392 in Social Security taxes over your working life for retirement and survivors benefits. For those taxes, you can expect to receive $2,088 a month in Social Security retirement benefits. Your rate of return under today's Social Security is 1.03%.

[/ QUOTE ]
[ QUOTE ]
Customize your data for better results by clicking on the pencil icons in the "Your Information" box.
Information Value Edit
Age: 65 Edit
Gender: Male Edit
Zip Code: — Edit
Current Earnings: $100,000 Edit
Life Expectancy: 81.00 yrs Edit
Retirement Age: 66.00 Edit

[/ QUOTE ]

http://www.heritage.org/Research/feature...;CL_FIRSTTIME=1

[ QUOTE ]
You can expect to pay $61,931 in Social Security taxes over your working life for retirement and survivors benefits. For those taxes, you can expect to receive $855 a month in Social Security retirement benefits. Your rate of return under today's Social Security is 3.38%.

[/ QUOTE ]

[ QUOTE ]
Customize your data for better results by clicking on the pencil icons in the "Your Information" box.
Information Value Edit
Age: 65 Edit
Gender: Male Edit
Zip Code: — Edit
Current Earnings: $15,000 Edit
Life Expectancy: 81.00 yrs Edit
Retirement Age: 66.00 Edit

[/ QUOTE ]

so 15 years retirement
paid in max min
290k 61k
15 year payout max min
376k 154k

so 10 years retirement
paid in max min
290k 61k
10 year payout max min
250k 103k

[AlexM]

[ QUOTE ]
SS is a good question.

can I answer this. first in dollars then in inflation adjusted dollars maybe.

a guy works and pays SS from 1960-90, retires and draws benefits from 1990-2005, then dies.

how much he pay in at max rate? min rate?
how much he draw out if he paid max? min?

single?married?

in actual dollar amounts? in inflation constant dollars?

[/ QUOTE ]

Starts working at 20 and retires 30 years later at 50? That's some damned early retirement.

[PLOlover]

[ QUOTE ]
Starts working at 20 and retires 30 years later at 50? That's some damned early retirement.

[/ QUOTE ]

I think it's just your top ten earning years. but in the example I just made it a 2:1 ratio.

[Copernicus]

[ QUOTE ]
[ QUOTE ]
Starts working at 20 and retires 30 years later at 50? That's some damned early retirement.

[/ QUOTE ]

I think it's just your top ten earning years. but in the example I just made it a 2:1 ratio.

[/ QUOTE ]

thought I responded to this but my comp froze and I dont see it. Benefits are based on all years of earnings back to 1951, adjusted for inflation.

In the heritage example you arent taking into account post-retirement cost of living adjusments, which increase the payouts.

In your original quesiton (1990 retiree, 30 years earnings and 15 years of payout), my comp froze before I could save the spreadsheet but the ROR that exactly exhausted his theoretical "self savings" on his date of death was 7.76%. And that doesnt take into account the potential for a lower earning or non-working spouse increasing the value.

[PLOlover]

[ QUOTE ]
In the heritage example you arent taking into account post-retirement cost of living adjusments, which increase the payouts.

[/ QUOTE ]

[ QUOTE ]
so 15 years retirement
paid in max min
290k 61k
15 year payout max min
376k 154k

so 10 years retirement
paid in max min
290k 61k
10 year payout max min
250k 103k

[/ QUOTE ]

lets take the max contrib, 10 year retirement. guy pays in 290k. now some of those dollars are 1960 dollars, some are 1980 dollars, etc. right or wrong? i'm not sure.

now take the payout of 250k. those are all in 2008 dollars. I'm pretty sure of that.

so my question is, can we convert the contributed to constant dollars? hard I know cause they're from all different years. now the payout dollars are already in constant 2008 dollars, which would be easy to convert to the standard constant 1982 dollars or whataever the benchmark is.

so it seems to me that
a) contrib 290k already in constant dollars in which case if they're in constant 2008 dollars then it's a simple 290:250 ratio in which case obviously you're getting a negative rate of return cause you're getting less back than you put in. also note if they are in constant dollars of any other (earlier) year, they will be worth more in constant 2008 dollars, so this is lowest possible.


b) contrib 290k is simple the sum of the dollars paid in at the time, which, when converted to constant 2008 dollars, would make it way bigger, at least 500k, which means the ratio would be 500:250, which means that in constant dollars for every dollar you put in you will get 50 cents back.

see where I'm going with this?

[ QUOTE ]
In the heritage example you arent taking into account post-retirement cost of living adjusments, which increase the payouts.

[/ QUOTE ]

yes but if 2088 monthly in 2008 is 3000 monthly in 2015, isn't that just another way of saying that in 2015 you get 2088 "2008" dollars?

[Low Key]

[ QUOTE ]
[ QUOTE ]
In the heritage example you arent taking into account post-retirement cost of living adjusments, which increase the payouts.

[/ QUOTE ]

[ QUOTE ]
so 15 years retirement
paid in max min
290k 61k
15 year payout max min
376k 154k

so 10 years retirement
paid in max min
290k 61k
10 year payout max min
250k 103k

[/ QUOTE ]

lets take the max contrib, 10 year retirement. guy pays in 290k. now some of those dollars are 1960 dollars, some are 1980 dollars, etc. right or wrong? i'm not sure.

now take the payout of 250k. those are all in 2008 dollars. I'm pretty sure of that.

so my question is, can we convert the contributed to constant dollars? hard I know cause they're from all different years. now the payout dollars are already in constant 2008 dollars, which would be easy to convert to the standard constant 1982 dollars or whataever the benchmark is.

so it seems to me that
a) contrib 290k already in constant dollars in which case if they're in constant 2008 dollars then it's a simple 290:250 ratio in which case obviously you're getting a negative rate of return cause you're getting less back than you put in. also note if they are in constant dollars of any other (earlier) year, they will be worth more in constant 2008 dollars, so this is lowest possible.


b) contrib 290k is simple the sum of the dollars paid in at the time, which, when converted to constant 2008 dollars, would make it way bigger, at least 500k, which means the ratio would be 500:250, which means that in constant dollars for every dollar you put in you will get 50 cents back.

see where I'm going with this?

[ QUOTE ]
In the heritage example you arent taking into account post-retirement cost of living adjusments, which increase the payouts.

[/ QUOTE ]

yes but if 2088 monthly in 2008 is 3000 monthly in 2015, isn't that just another way of saying that in 2015 you get 2088 "2008" dollars?

[/ QUOTE ]

You know what? I will paypal the OP $10 if he takes all this and reads it at his teacher, and videotapes the whole thing and puts it on youtube. Seriously. Ten bucks. And it could be any of the exceedingly long and detailed, broken down posts about social security, complete with numbers and everything. Ten bucks... Just something to consider.

If the teacher cuts him off and points out that it's not an Econ class, he only gets $5.

You'd have to include some footage proving it was the school you go to, but I'm not asking for much. Just a little proof.

[Copernicus]

[ QUOTE ]
[ QUOTE ]
In the heritage example you arent taking into account post-retirement cost of living adjusments, which increase the payouts.

[/ QUOTE ]

[ QUOTE ]
so 15 years retirement
paid in max min
290k 61k
15 year payout max min
376k 154k

so 10 years retirement
paid in max min
290k 61k
10 year payout max min
250k 103k

[/ QUOTE ]

lets take the max contrib, 10 year retirement. guy pays in 290k. now some of those dollars are 1960 dollars, some are 1980 dollars, etc. right or wrong? i'm not sure.

now take the payout of 250k. those are all in 2008 dollars. I'm pretty sure of that.

so my question is, can we convert the contributed to constant dollars? hard I know cause they're from all different years. now the payout dollars are already in constant 2008 dollars, which would be easy to convert to the standard constant 1982 dollars or whataever the benchmark is.

so it seems to me that
a) contrib 290k already in constant dollars in which case if they're in constant 2008 dollars then it's a simple 290:250 ratio in which case obviously you're getting a negative rate of return cause you're getting less back than you put in. also note if they are in constant dollars of any other (earlier) year, they will be worth more in constant 2008 dollars, so this is lowest possible.


b) contrib 290k is simple the sum of the dollars paid in at the time, which, when converted to constant 2008 dollars, would make it way bigger, at least 500k, which means the ratio would be 500:250, which means that in constant dollars for every dollar you put in you will get 50 cents back.

see where I'm going with this?

[ QUOTE ]
In the heritage example you arent taking into account post-retirement cost of living adjusments, which increase the payouts.

[/ QUOTE ]

yes but if 2088 monthly in 2008 is 3000 monthly in 2015, isn't that just another way of saying that in 2015 you get 2088 "2008" dollars?

[/ QUOTE ]

Truthfully Im not following your verbal math. the important thing is the ROR on the contributions that equates to the payouts. (An actuarial equivalence is preferable to a simple "he lives 15 years", but its close enough).

Once you get that ROR, you compare it to reasonable rates of return (which include compensation for inflation). Converting to "constant dollars" is irrelevant, because the invested dollars were subject to exactly the same inflation whether they were invested privately or "invested" through the SS system. If youre going to adjust both scenarios the same way, theres no reason to adjust at all.

[Low Key]

..Zomg I went to college and they tried to show me a point of view I don't already belive in! ZONOES!! Quick, call Sean Hannity and get that kid who had to watch An Inconvenient Truth on the air with me!

[ QUOTE ]
He happens to be Hungarian and immigrated many years ago, so I feel that his roots likely have a huge effect on his opinions.

[/ QUOTE ]

Just like yours do.

[ QUOTE ]
maybe they shouldn't take his words as gospel simply for the sake that he is a teacher (which I feel many do)

[/ QUOTE ]
If you really feel it's that important, why not just sit down with each of them and have that talk where you explain how one person can't possibly know everything.

My last PolSci class had a small hint of conservatives, a dab of liberals, a large cross section of people who really could care less what the teacher was talking about. (My teacher happened to be liberal, but he always pointed out when he was inserting his particular bias)