re: re: chronic

[Javier Jimenez <jimenj@yahoo.com>]

> seeming to have little understanding of cost of living in the
> working middle class, or are we "rich" at $45,000 per year, especially
> when we may have sold our house and are battling to pay off debts
> incurred while trying to keep going after a medical disaster,
> compounded by loss of income, increased work load on the healthy
> family member(s) and increased costs, and debt, caused by the
> disabling condition itself.
>
>------------------------------------

This is the problem with government dependence.  People think that
when in need the all benevolent government will hurry to assist.
People don't realize that disability benefits kick in after a
long-term disability, and only when that disability prevents the
beneficiary from performing any kind of work.  Currently I carry
personal disability coverage for replacement of income of $2500/month
at a cost of $606/year with a guaranteed yearly increase in benefit
of $700/Year (of course, with an additional premium), a waiting
period of 90 days, and be considered disabled to perform the duties
of my current profession.

Now consider, a portion of SS is earmarked for disability coverage.
Consider the following example:

         $2500.00       Monthly Income
        $30000.00       Annual Income
         $1860.00       Annual Employee SS Tax
         $1860.00       Annual Employer SS Tax

         $3720.00       Total SS Tax
          $606.00       Annual Disability Premium
          $400.00       $300,000 20 Year Term Life Insurance Policy
                        (Compare to $255.00 Death benefit under SS)
        ---------
         $2714.00       Approx. investment under privatized system.

After 35 years of work, a nest egg of $230,932 can be accumulated
(assumes 8% annual return, the 20 year average return on stocks,
and a 3% inflation, total in today's dollars, with contributions
inflated at the rate of inflation); at 6% annual return (equivalent
to a bank CD) a nest egg of $156,643 can be accumulated.  This nest
egg would provide a level of economic protection greater than that
of SS.  Coupled with other savings and investment vehicles, not
only will workers enjoy greater retirement income and freedom, but
they will be able to transfer wealth to their heirs that will enable
future generations to prosper in ways that the current SS can't
equal.  Under a private system, not only will the workers own their
capital, they will be less dependent on the government in time of
need.  As a regulator, the government can provide a better service
than our insurer, investor, educator, etc...

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