WASHINGTON (May 22, 2000) – The National Center for Policy Analysis (NCPA) unveiled a new online benefits calculator that will allow workers to determine their personal investment in the growing debate to reform Social Security.
The calculator — found at www.mysocialsecurity.org – shows you what you will pay in taxes, what you will receive in benefits, and what you would have received if you were allowed to invest the same dollars in a private account. It also shows the rate of return you can expect from the current system, and how high the payroll tax rate will have to be by the time you retire to pay for all senior health benefits promised under current law.
"Find out what you're going to pay and what you're going to get," said NCPA president John C. Goodman. "The NCPA's calculator is more accurate than any existing calculator, including the estimates of the Social Security Administration, especially for younger workers."
The NCPA's calculator, for the first time anywhere, uses census data on nearly 500 different occupations to help project a user's future income growth, providing the most accurate benefit projection available. By contrast, most benefit projections, including those made by the Social Security Administration, fail to account for income growth over a person's working life.
Some representative examples using the NCPA's calculator:
- A 25-year old waitress under the current system can only expect to receive 49 cents in benefits for every dollar she pays in Social Security taxes. Her expected monthly Social Security benefit will be $926 in today's dollars. Yet if she were allowed to invest those dollars in real assets, she could have a private pension of $2,507.
- A 30-year old construction worker under the current system can only expect to receive 32 cents in benefits for every dollar he pays in Social Security taxes. His expected monthly Social Security benefit will be $1,353 compared to $5,661 if he had invested privately.
- A 40-year old male bus driver under the current system can only expect to receive 25 cents in benefits for every dollar he pays in Social Security taxes. His expected monthly Social Security benefit will be $1,306 compared to $7,007 if he had invested in stocks and bonds.