Your Tax Dollar – 12.4% In, 20% Out to Social Security

April 12th, 2007  |  Published in Social Security  |  3 Comments

Over 20% of every tax dollar paid by every American goes to paying out Social Security benefits to existing retirees. Twenty percent to existing retirees, not retirees that are going to retire in the future, just the ones collecting checks right now. Did you know that 6.2% of your salary goes towards Social Security and another 6.2% is paid by your employer? That’s only 12.4%, which means it looks like we have a shortfall of 6.6% each and every dollar for Social Security. Ouch.

I’m not complaining about what I have to pay or whatever, I’m just saying that the math doesn’t lie… Social Security is in trouble, right?

Source: Yahoo Finance

  

Responses

  1. fivecentnickel.com says:

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  3. Peter says:

    April 18th, 2007 at 11:31 pm (#)

    I have to say, your math is terrible. For one, I’ll assume that you arrived at the 6.6% shortfall by subtracting 12.4 from 20, which is not 6.6, but 7.6. However, the 12.4% is a percentage of Salary, whereas the 20% is a percentage of the taxes paid. You are comparing apples to oranges. If you round the percentage of your salary up to 40%, then 20% of that is 12.5%. There is no discrepency. In fact, these are estimates. Social Security is still bring in more money that it is paying out in benefits, and will continue to do so for at least 10 more years.