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A Little More Security in Growing Old

Come clean now; do you really expect to collect on Social Security when you hit retirement?

I can’t recall when I first heard it, but it’s been at least a decade since we were warned Social Security may not exist when we retire. Retirees were quickly outnumbering the workers paying in, and it was just a matter of time until the system went broke.

It quickly became the mantra of any financial planner or real estate agent worth his or her salt: Invest now in Universal Life-401(k)-IRA-the stock market-real estate-you pick the investment, because Social Security’s well was running dry, and how would you expect to live off the government’s $15,000 a year anyway?

I have been conditioned not to expect a plug nickel from the government when I retire, and I suspect to some extent, you have too.

So, much to my delight and relief, it looks like the Bush administration is planning to revamp Social Security so that I will indeed get a few bucks as a reward for fortysome years of faithfully paying into an arcane, bureaucratic system that for years has warned there’s no guarantee of getting anything back at the end. The flags unfurled, the band struck up “Stars and Stripes Forever” and fireworks that would dwarf the KGB Sky Show shot into the air all around me. Hallelujah, I’ll be getting a check when I’m 65.

Better still, like the insurance salesman who hit me up when I was 21 and newly married , ironically, his last name also was Bell , President Bush will pitch the overhaul of Social Security by saying we can control our own financial destiny.

Basing retiree benefits on inflation rates rather than the increase in wages over one’s career means a lot of us won’t get back what we put in. It’s estimated that I’ll see a 10 percent cut in my guaranteed benefits if I retire in 2022. Some 20 years later , about the time my kids are nearing retirement age , the figure is cut by more than a quarter.

Bush’s plan to make up the difference hangs on personal investment accounts , hoping to harness returns on stocks and bonds. His moxy as a salesman will be tested. Bush will need a high-pressure sales pitch to help us forget being burned the last several years on our 401(k)’s and a volatile stock market.

From the Internet to prime-time television, the president will be pulling out all the stops in the next couple of months to tell us Social Security is broke and in serious need of repair. No need for pop-ups on Forbes.com, full-page ads in the

Wall Street Journal

and 60-second spots on “American Idol” to convince us of that one.

Social Security is the feds’ No. 1 expense. In 2003, $479 billion was spent on Social Security. By comparison, the government spent about $375 billion on defense.

Social Security trustees believe the system will go into the red sometime late next decade; reserves, they believe, will last until 2042, though the Congressional Budget Office puts the depletion date at 2052.

For the record, I’ll be pushing 100 about then, which actually brings us to an interesting point. We baby boomers , I’m among the tail end of that creaky-kneed, achy-back demographic , aren’t just growing to become old codgers; we’re becoming

really

old codgers. Simple things like not smoking, avoiding double bacon pastrami cheeseburgers for lunch and chasing off the daughter’s boyfriends before they cause massive heart attacks is edging our lifespan ever closer to 80.

That, of course, means even bigger numbers of Americans will be living in mobile home parks, watching “Judge Judy,” and drawing government checks for a lot longer than FDR ever imagined when he set up Social Security in 1935.

Even if the Bush administration gets everything on its wish list and Social Security is tied to a price index , Democrats shiver at the prospect of privatizing government’s single-biggest expenditure , I consider it found money. If they’re still cutting me checks midway through the century, all the better.

Like that $5 bill you discover stashed in the pocket of a coat you haven’t worn in six months, something is better than nothing , especially when you don’t expect it.


Rick Bell is the

San Diego Business Journal’

s managing editor.

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