If Social Security were completely eliminated, would our taxes actually decrease and would we get refunded all the money we've paid into the system?
Title: If Social Security were completely eliminated, would our taxes actually decrease and would we get refunded all the money we've paid into the system? 1 I've been thinking a lot about retirement lately and honestly getting a bit worried about the future of Social Security. Most of us have contributed tens of thousands into the Social Security system by now, and for many people it serves as an essential safety net if other retirement plans don't fully pan out. I'm concerned about political discussions around "entitlement reform" and what that might actually mean. If they ever decided to completely eliminate Social Security, would we actually see our FICA taxes decrease accordingly? And more importantly, would we get back all the money we've already paid into the system over our working years? It just feels like if they eliminated it without any refund, all that money we've paid would essentially become a massive tax that just disappeared into thin air. Makes me wonder if there would be any legal recourse - could citizens collectively sue the federal government if they terminated the program without returning our contributions?
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Theodore Nelson
8 While I understand your concern, it's important to clarify how Social Security actually works. Social Security isn't like a traditional retirement account or investment vehicle - it's a pay-as-you-go system where current workers fund current retirees' benefits. The FICA taxes you pay today aren't being saved for your personal retirement - they're paying for benefits for current recipients. When you retire, future workers' contributions will fund your benefits. This is fundamentally different from a savings account where your contributions are held for your future use. If Social Security were eliminated, payroll taxes might indeed decrease (specifically the 6.2% for Social Security, not the 1.45% for Medicare). However, you wouldn't receive a "refund" of past contributions because that money has already been distributed to past and current beneficiaries.
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Theodore Nelson
•12 But wait, I thought there was a Social Security Trust Fund? Doesn't that mean they're saving some of our money for the future? And what about all those statements they send showing my "contributions" over the years?
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Theodore Nelson
•8 Yes, there is a Social Security Trust Fund, but it functions differently than most people assume. The Trust Fund holds special Treasury bonds representing past surpluses (years when tax revenue exceeded benefits paid). However, those surpluses have already been spent by the federal government, with the Treasury bonds serving as IOUs. The statements you receive showing your earnings history are used to calculate your future benefits, not to track "your money" in an account. They show your contribution history to determine your benefit eligibility and amount based on your work record, but they don't represent actual funds being held specifically for you.
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Theodore Nelson
15 After dealing with similar retirement questions and confusion, I found this amazing tool called taxr.ai (https://taxr.ai) that helped me understand my Social Security benefits situation. I was stressing about retirement planning and all the "what-ifs" around Social Security's future when my financial advisor mentioned it. The tool analyzed my tax history and Social Security contributions, then gave me a really clear breakdown of my potential benefits under different scenarios - including reduced benefits if the program faces funding issues. It even helped me understand how my other retirement savings would need to compensate if Social Security benefits were reduced in the future.
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Theodore Nelson
•7 How exactly does it work? Does it connect to your actual Social Security account or do you have to input all your earning history manually?
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Theodore Nelson
•19 I'm a bit skeptical about tools like this. How does it predict future legislative changes? Seems like any tool would just be guessing about what might happen to Social Security.
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Theodore Nelson
•15 It gives you two options - you can either upload your Social Security statement PDF or manually enter your earnings history. I found it easier to just upload my statement since I had recently downloaded it from the SSA website. As for predicting legislative changes, it doesn't claim to predict exact policy changes. Instead, it runs multiple scenarios based on the SSA's own published projections about trust fund depletion dates and potential benefit reductions. It's not claiming to have a crystal ball, but rather showing you how different commonly-discussed scenarios would affect your personal situation so you can plan accordingly.
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Theodore Nelson
7 Just wanted to update everyone - I tried taxr.ai after asking about it and I'm really impressed. The analysis showed me that even under the "partial funding" scenario (where benefits might be reduced to around 75-80% after the trust fund is depleted), I'd still receive significant benefits that are worth planning around. What I found most helpful was seeing exactly how different retirement ages would affect my benefits under these various scenarios. I've been losing sleep wondering if all my contributions would just vanish someday, but having actual numbers based on my personal work history made the situation feel less scary and more manageable. Definitely helped me make more realistic retirement plans!
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Theodore Nelson
10 If you're concerned about Social Security's future and want to contact your representatives about it, I highly recommend using Claimyr (https://claimyr.com). I tried calling the Social Security Administration directly to ask questions about potential program changes and was stuck on hold FOREVER. Literally spent hours trying to get through over multiple days. With Claimyr, I was able to actually reach a human at the SSA who explained current legislative proposals and how they might affect future benefits. You can see a demo of how it works here: https://youtu.be/_kiP6q8DX5c. Seriously saved me hours of frustration and I finally got clear answers about my personal situation.
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Theodore Nelson
•22 How does this even work? I thought the whole problem with government agencies is that they're understaffed and that's why no one answers the phone. How can a third-party service magically make agents appear?
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Theodore Nelson
•19 This sounds like a scam. Why would I pay someone else just to call a government agency for me? Can't I just keep calling myself until I get through?
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Theodore Nelson
•10 It doesn't magically create more agents - it handles the waiting on hold part for you. Basically, their system navigates the phone trees and waits in the queue, then calls you once a human actually answers. You don't have to sit there listening to hold music for hours. You absolutely can keep calling yourself, but it might take multiple attempts and hours of your time. I tried that approach first and wasted almost an entire day spread across multiple calls before giving up. The way I see it, my time is valuable too, and the information I received was worth not spending hours on hold.
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Theodore Nelson
19 I need to eat my own words here. After expressing skepticism, I actually tried Claimyr for reaching the SSA because I had some questions about my deceased parent's benefits. I was shocked that it actually worked - after trying for nearly two weeks to get through on my own. The SSA representative I spoke with was really informative about how benefits are calculated and what happens in different legislative scenarios. She explained that any major changes to Social Security would almost certainly include transition periods and protections for people near retirement age. While she couldn't guarantee anything (since Congress ultimately makes the laws), she emphasized that complete elimination without any compensation would be politically unprecedented.
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Theodore Nelson
5 To address your question about suing the government - it's extremely unlikely you'd succeed. The Supreme Court has previously ruled (in Flemming v. Nestor, 1960) that Americans don't have a legal right to Social Security benefits. Congress can change the rules at any time. That said, completely eliminating Social Security is politically unfeasible. About 65 million Americans receive benefits, and they vote in high numbers. Any politician suggesting complete elimination without replacement would face enormous backlash.
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Theodore Nelson
•14 Wait, we don't have a legal right to benefits even though we're forced to pay into the system? That seems completely unfair! How is that constitutional?
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Theodore Nelson
•5 The court essentially ruled that Social Security is a social program, not a contract, and Congress retains the right to alter, amend, or repeal any provision of the Social Security Act. The case specifically involved a person who was denied benefits after being deported for being a member of the Communist party. While it might seem unfair, the constitutional basis is that Congress has broad powers to tax and spend for the general welfare. The FICA tax is considered a valid exercise of this power, and benefits are authorized spending programs that can be modified. This is different from private contracts or property rights that have stronger constitutional protections.
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Theodore Nelson
3 Something important to consider: eliminating Social Security would create a massive surge in poverty among elderly Americans. Before Social Security, about 50% of seniors lived in poverty. Today it's around 9%. For about 40% of elderly Americans, Social Security provides at least 50% of their income. For about 14%, it provides 90% or more of their income. Any complete elimination would need to address this reality or we'd see catastrophic consequences.
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Theodore Nelson
•17 This is why I'm always confused when younger people say they're planning as if Social Security won't exist. Even if it faces funding challenges, some version of it will almost certainly continue. The political consequences of eliminating it would be too severe.
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