Dr. Steve Finger for Congress
                                          "A Campaign of Ideas"                       


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Social Security

Astonishingly, the return on Social Security contributions for workers entering the workforce today is estimated to be approximately 2% per year, lower than that on the poorest performing bank account. For this reason, as well as for a variety of others, many people believe that it is time for a partial privatization of the Social Security system. I would urge Congress to develop this program as a "LIBERTY ACCOUNT."

Social Security is financed by a 6.2% tax withheld from every worker's pay as well as a matching contribution made by his or her employer. 

Under partial  privatization, the employer's contribution will be unchanged and will be deposited with the government as always. The worker, however, will have a

At the end of each year, every worker will be able to decide to either allow his contribution to stay with the government, as is now the case, or to transfer it to a Social SecurityLiberty Account which could be held in any regulated financial institution such as a bank or brokerage firm and which would be controlled  by  the  worker. These funds would be limited to investment in bank C.D.'s, stocks, bonds, mutual funds, Treasury Securities or in a combination of these instruments.

Workers who choose not to participate in partial privatization would leave their full contribution with the government and be entitled to a full Social Security pension upon retirement. 

Workers who choose to have their contributions transferred to a Liberty Account will receive one half of the normal Social Security pension and will, upon retirement, be able to use the accumulated funds in their Liberty Account as  they  see  fit. either withdrawing them in whole or in part or withdrawing only the interest or purchasing an annuity or whatever else the account holder chooses.

Each Social Security Liberty Account would, unlike a conventional Social Security account, be owned by the account holder. Funds remaining in the account would, upon the death of the account holder, become part of his or her estate and could be willed to an heir, spouse, partner, etc.

I strongly support partial privatization of Social Security.

Want to see what your Social Security Liberty Account would grow to thru the miracle of compounding:

Start with 0, estimate the number of years you will be working (40?), estimate your annual salary and multiply by .062 (your Social Security contribution).

Pick a rate of return (maybe 5% for bank C.D.'s or Treasury Securities, 10% for stocks or stock mutual funds, 7% for a combination) and see what you'll have at retirement. And this is in addition to one half of a regularSocialSecurity pension.