Privatizing Social Security Is A "Must"
May 18, 2000
More Americans than ever before are invested in stock markets. Yet many Americans have no pensions or savings at all. For the retired and those nearing retirement, Social Security is crucial.
But for younger workers who are as financially imprudent as their counterparts in prior generations were, allowing them to place a portion of their Social Security payroll taxes in market investments would mean much brighter retirement prospects.
- According to a survey sponsored by PaineWebber and Gallup, one-third of Americans have no savings.
- Another one-third have saved less than $2,500.
- Twenty percent spend their 401(k) distributions instead of rolling them over into another plan.
- Some 50 million Americans have no pensions at all.
Since 1983, the number of individuals who own stock has nearly doubled -- from 42.4 million to 78.7 million.
But it is those who have made no provisions for retirement, experts point out, who would greatly benefit from Social Security privatization. A higher rate of return and compounding of their investments would leave them with handsome nest eggs at retirement -- rather than having to rely on paltry Social Security returns.
Source: Donald B. Marron (PaineWebber Group Inc. and the National Commission on Retirement Policy), "Not Privatizing Social Security Is the Biggest Risk of All," Wall Street Journal, May 18, 2000.
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