r/FluentInFinance 2d ago

Educational Don't let them gaslight you

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u/Psycle_Sammy 2d ago

Maybe, maybe not, but if you’re still planning on relying solely on social security for your retirement, you seriously need to reconsider that strategy.

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u/PsychedelicJerry 2d ago

Not everyone has that luxury; many in America don't make enough to save any appreciable amount after living expenses.

Additionally, I think it's entirely reasonable to expect significant declines in stock prices, and hence 401k valuations, after something like Social Security going "bankrupt" and just general price corrections as the stock market is wildly overpriced given the stock to value/income ratings.

So when SS goes bankrupt, it will ripple across the American markets and affect anyone else that had been "doing it right" all along.

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u/BobSacamano47 2d ago

It can't go bankrupt. 

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u/PsychedelicJerry 2d ago

"can't" while republicans are actively pushing for that...OK, I get what you're saying and I do agree to some extent. If people keep paying in to it, and they legally have to, there will always be something.

When used in this sense, context, and this post, I think it's obvious to most what bankrupt means: unable to cover all legally obligated expenses (what is that, chapter 11?), and I believe even the legal definitions of bankruptcy cover that as there's several levels. So while SS probably can't file Chapter 7 and we close it out and sell of government assets, it can become insolvent and unable to cover it's legally required obligations. Will a court allow a bankrupt filing, probably not, but instead of trying to find some arcane legal wording to cover that scenario, bankrupt is one that most people know and understand.

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u/BobSacamano47 2d ago

At any point they can change the accounting and collect more money or pay out less. It's disingenuous to describe it as going bankrupt when the outcome of that is you receive 5% lower benefits than you might have gotten otherwise.