Silver Lifetime
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For me, it is kind of the other way around.On the positive side, because of Social Security few people in our society contribute financially to the support of their aged parents. Nor do we need to have large families in order to guarantee someone will support us in our old age. Instead of thinking about the system as "getting back what I paid in," it might be less painful to think of the payroll tax as "my contribution to the support of my parents in their old age." In countries without such a system, children are expected to provide for their parents if not actually take them into their homes and care for them in their "golden years."
First, my parents did fine financially. Between the inheritance from selling the family farm, and then selling their own farm, and both of them working for most of their careers - they did okay, and left a bit of their wealth to us three boys.
My dad died first and I encouraged my mom to not think about an inheritance for us boys - but to spend her $ being happy - plus she lost a chunk in the housing bubble (a lot of people did), so while I inherited a nice sum, it did not make me rich.
Both my parents worked for the state and my dad got a pension, so I am not sure if they paid into SS (I think my mom might have). We (my brothers and I) were a bit concerned about her expenses though - because the last years of her life she was in a somewhat expensive assisted living facility, but she died before it became an issue.
But for me - my kids can't really support me if they had to - the best they could do for me financially would be for me to move in with them - which I would not want to do - I like being independent and living alone. Plus, I don't need to as SS covers my expenses (barely). I am now pulling about 2% per year from my IRAs, but SS means that I don't need to pull more - I think my IRAs would cover my expenses indefinitely though.
The plan is to leave my IRAs for my daughter as she may have to retire early due to health issues, and even with their two incomes, they barely make their expenses.
IIRC, half of the self-employment tax is deductible?I do admit, however, that the Self-employment Tax, the "other half" of the payroll tax, or the employer contribution, is oppressive and burdensome for those with a small business. I personally experienced the painfulness of this when my wife had her own small business. Although her business was fairly successful, it seemed like .gov took an awfully big bite, which goes unnoticed when one is on a payroll.
I always consider both halves (employee & employer) as something that should just be paid outright to the employee. I have always advocated for no income tax on anybody, but rather a FLAT sales tax on every good and service, with no exceptions, no deductions, no rebates, no minimums and every entity is taxed (i.e., no exceptions for non-profits/et. al.). I would also advocate for a balanced budget - i.e., no deficit spending - only spend what the gov gets in revenue.