In my Op-ed published on December 8 by Bloomberg News (at I suggested that the Social Security System could be made financially stronger while giving Social Security beneficiaries more choices about how and when their benefits are distributed.

Having already received questions about how this may be possible, this is the first of several blogs to provide more detail about elements of my reform proposal. Let me start with answering some of the critical questions.

  1. Does my proposal represent a privatization of Social Security and turning over $12 to $15 trillion to Wall Street? Definitely not! It simply involves giving beneficiaries more options with their promised benefits. When the article refers to a personal retirement program, it’s not about a private investment account, but how you could customize your Social Security benefits to meet your personal circumstances.
  2. Is the source of the projected savings the result of beneficiaries deferring the election of benefits until, say, age 75 and having Social Security recover their personal store of value at their death? Again, the answer is No, but requires a three-part answer:
    • While the headline writer changed the original headline above to “Cash in at Age 75 and Help Save Social Security”, there is nothing sinister about deferral. Under current Social Security rules, you can defer from age 66 to 70 and get a 40% increase in benefits. My proposal simply extends that concept.
    • The article states that any increase in the deferred payments reflects both interest and longevity credits. Thus deferred payments give you credit for the expected recovery to the System from deceased beneficiaries. To illustrate, deferral from age 70 to 75 might produce as much as a 70% increase in benefits.
    • While some few individuals will elect a 100% deferral, the more likely scenario under this reform is to stage retirement and coordinate the deferral with a savings drawdown and/or other income. A subsequent blog will show the advantages of such a strategy.
  3. Will the future demographics of the country really help when the ratio of active workers to retired workers seems to be decreasing, creating greater pressure on the Social Security system? The answer is yes, but you need to look far enough into the future. While there’s a period with baby boomers retiring when that ratio is decreasing, that phenomenon eventually begins to reverse itself, in quite a dramatic fashion, according to US Census projections. This is particularly true using the Census Bureau’s “high immigration” scenario.

As I wrote to one individual with serious doubts about the proposal, I’m used to some initial skepticism, and I’ve always had confidence in the often predictable stages of any new idea:


Hopefully, the information in this and future blog will help in beginning the path to the “self-evident” stage.

Jerry Golden