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Originally Posted by Superbelt
But that's what the plan does. If you sign up for the partial privatization you no longer get the advantage of the full SS insurance system.
You have to live with what you have saved to that point, and unless you die in your late 50's, your family won't have much to draw on.
It's a major drawback of privatization versus the SS insurance system.
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As I understand it one of the guiding principals Bush set up for SS was to preserve SS disability and survivor benefits. The benefits of being able to invest a large portion of our FICA tax in mutual funds like the government's Thrift Plan and retire with far more than SS would provide make these personal accounts well worth the effort.
http://www.ssa.gov/qa.htm
The bipartisan Commission he appointed put forward three models based on these principles. These models are in the process of being discussed, as are other alternatives
There are many possible ways to structure personal accounts. Several proposals recommend that a personal savings account plan for Social Security be modeled after the federal government's Thrift Savings Plan. This very popular plan for federal employees and members of Congress allows a choice of five highly diversified, low-cost mutual funds. In the Thrift Savings Plan, no direct investments in individual stocks are allowed.
Disability and SS
Reform proposals would affect only the retirement portion of Social Security.
The disability program (which provides payments to workers who become disabled) and the survivors program (which provides payments to children of workers who die) are separate parts of the Social Security program. Allowing workers to shift some of their payroll taxes to a personal retirement account would have no impact on these other programs.