Social Security Needs Help
In 1936 when Social Security took effect, the average wages per person in the U.S. was under $2,000 a year, the average cost of a new house was $4,100, and, "Hey Buddy, can you spare a dime?” Then you could choose between buying a loaf of bread and a gallon of gasoline.
Also in 1936, according to the U.S. Department of Commerce, the average birth rate was about 6,000 babies a day. Less than ten years later, after World War II, that rate would double to about 12,000 a day and remain at that level for almost twenty years. This became the Baby Boomer Generation; and under the GI Bill, this generation went to school and bought homes.
By the mid 1950’s, Congress knew they had a problem on their hands. Social Security was never designed to address these kinds of birth rate numbers or inflation prices and would not provide a workable stand-alone “national pension”. Starting in 1956, Congress, working with the Internal Revenue Service, began passing social legislation that was designed to entice Americans to save money for retirement to add to their Social Security benefits. This is why IRA, Keogh and 401K retirement plans were created, because today 10,000 Baby Boomers are turning age 62 every day!