How Much Does SS Screw You?

Here are my results from Heritage’s Social Security Calculator:

You can expect to pay $350,881 in Social Security taxes over your working life for retirement and survivors benefits. For those taxes, you can expect to receive $2,467 a month in Social Security retirement benefits. Your rate of return under today’s Social Security is -3.56%.

However, if you had been able to invest your Social Security taxes in a Personal Retirement Account (PRA), you would have had a total of $1,401,434 when you retired. Your monthly benefits would have been $11,416. You lost $8,948 a month.

Now, what’s supposed to be the problem with this, exactly, especially when much poorer folk than me can also expect to be doing a lot better? Why are so many people so eager to oppose a program that makes almost everyone better off? I find it truly baffling.

Author: Will Wilkinson

Vice President for Research at the Niskanen Center