Social Security Voyeurism

Today’s post is about “me,” although I guess you could say it still falls within the theme of social impact as it deals with our social safety net in this country and one of its pillars, Social Security.

I just received my first social security check – waiting until the maximum benefit kicks in at 66 and 2/3 years of age – and I thought you might be interested in the path and particulars of it.

According to Social Security records, I started on this journey 50 years ago in 1975 when I had taxed social security earnings of $14.  Fourteen dollars!  I’m trying to resurrect how I may have earned that?  Raspberry picking out in the fields is one possibility.

Over the course of 50 years, I had taxed social security earnings of $3.1 million.

Of that total, $2.9 million were wages I earned working for myself via my business, Oliver Russell.

That’s important because I was both the employee and employer, so I picked up the entire tax myself.  (Rather than simply being the employee and having someone else as employer who would then pick up half the FICA tax for you.)

All told, those taxes amounted to just over $400,000.

And my monthly Social Security benefit is $3,749.

Not bad.

I’m happy to have it. 

Through a career of diligent payroll deductions with employer matching contributions to an Individual Retirement Account (IRA), I managed to save about $1 million over the course 40 years.

That mil was reduced by a couple hundred thousand through a withdrawal to help fund an ill-fated start-up venture back when I was 50.  (Not only did the capital investment go down the drain, but I also incurred a penalty and had to pay taxes on the withdrawal. Very. Bad. Move. Russ!)

So, I wound up with $800,000 in my retirement fund.

Over my career at OR I have donated more than 2.5 million to nonprofits and social enterprises.

So, with some quick math, you can see that I donated far more than I saved over my career, another reason I’m grateful for that social security check.

I wouldn’t change a thing about those donations.  They went to worthy organizations ranging from the Good Samaritan retirement home (for air conditioners) to human rights NGOs to the U.S. Women’s Olympic Fencing Team. 

I’d also be lying if I didn’t say I’d had thoughts of how some of those donations back could have helped me at times when things got entrepreneurially tight, if you know what I mean!

Now I do have equity in real estate assets (house, office building) that likely squares up that deficit between savings and donations.

So, that makes my career a one-for-one: For every dollar accumulated or saved, one was donated.

Factor in personal giving beyond what I did through business, and it's >1:1.

>That's what I like to call "regenerative energy" – creating more energy than you consume.

And I’ll be A-OK in retirement if I can continue to remain healthy.

The point of all this – aside from what I think might be an interesting glimpse into how retirement savings work for one person – is to draw attention to Social Security as it is the bedrock of finances for many Americans in their later years. 

Social Security provides more than 90% of income for one in four Americans. In all, it lifts 16 million older Americans out of poverty each year, making it one of the most effective anti-poverty programs in U.S. history.

For sure, the program has funding challenges ahead.  But I can’t imagine where our older citizens would be right now without the foresight of a government who created this program in 1935 as part of the “New Deal.” 

And I can’t fathom that the middle-age children of elderly parents would be happy about the prospect of picking up this financial commitment if this income stream were to go away.

Oh, in case any of you think I’ve retired, I haven’t – there’s too much work to be done.  I still consult on branding, operate a coworking space, and write this newsletter.

Thanks for taking a tour of Social Security with me.

Godspeed, friends.

Russ

💬 Think About It

"Be yourself. Everyone else is already taken." Oscar Wilde

💥 Quick Hits: Social Security Edition

• Ida May hit the jackpot – Social Security’s first beneficiary was Ida May Fuller, a legal secretary in Vermont who paid in $24.75 in taxes and collected more than $22,000 in benefits by the time of her death at age 100.
• It’s not just for retirees –  One-third of beneficiaries are disabled workers, surviving spouses, or children of deceased workers.
• Your number tells a story – Originally, the first three digits indicated the state where you applied (mine was 543, for Oregon), the middle two were group numbers, and the last four were sequential. This system was abandoned in 2011 in favor of randomized number for security reasons.

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