Cash Now!

"It's your money, use it when you want it" -- so goes the late-night J.G. Wentworth TV commercial aimed at beneficiaries of "structured settlements," which are basically annuities paid over time.  You can cash out one of these settlements for a lump sum, but obviously at a discount.  Alex J. Pollock at the American Enterprise Institute asks if you'd take 80 cents on the dollar for your expectation of Social Security benefits.  Would I?  Does the Pope have lips?

The problem, of course, is that it's not your money.  It's not even money.  It doesn't exist at all.  So on that basis, heck, I'd take 10 cents on the dollar and feel like a successful bandit.
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8 comments:

  1. Grim11:32 AM

    I'd take nothing beyond not having to continue to contribute.

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  2. MikeD2:16 PM

    Amen to the, Grim. And if Social Security is there when the day comes for me to retire, I'll eat Grim's hat. And let me tell you, I don't look forward the fight I'll go through to try doing so. That's how sure I am it won't be there.

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  3. E Hines2:39 PM

    The problem, of course, is that it's not your money.

    Yes, it is. All money sent to government in the form of taxes is our money; we've just allocated it to government for purposes to which we've agreed.

    If we no longer find those purposes useful, or if we find government has reneged by using the money we've allocated for other purposes, it's entirely legitimate to demand it back, or to avoid hammering those who are currently dependent on government, to stop further payments.

    The way to achieve that reliably is to fire those representatives who've stopped following the instructions of their bosses--which is us--and keep turning them over until we get a crop that will.

    Of course that's harder when there's a lack of consensus, but that's a different story. The money we pay in taxes still is ours, even after we've sent it to government.

    As a result, I'd gladly take the future value of my "entitlement" stream in a current lump sum, but an added requirement would be that the rest of you also would be relieved of the need to keep making those tax allocations to my share.

    Eric Hines

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  4. Texan996:23 PM

    My point wasn't that you aren't entitled to it, but that it doesn't exist any more.

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  5. Donna B.8:47 AM

    Ha! You make it sound like J.G. Wentworth offers 80 cents on the dollar.

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  6. Texan999:18 AM

    I wish! No, I spent much of my career in court litigating present values of future income streams (a process that mostly involves arguing over the right assumptions for risk and inflation). I'm not sure what the SS administration is referring to when it values the SS trust fund at 80 cents on the dollar, but it can't literally be a cash-out number. Probably more like a future value number: an admission that the amount isn't at 100% even before you discount to present value.

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  7. Anonymous9:47 AM

    Hey, give J.G. Wentworth a few points for bringing bad opera (good voices, bad lyrics) back to TV! :)

    That said, I look at my SS contributions as an un-deductable donation to a non profit, and I'm stocking up on skills and an IRA for my retirement, should I ever retire.

    LittleRed1

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  8. BillT5:24 AM

    And Libs still buy into the lie that their contributions have been in a "lock-box"...

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