"Jason's Riley's attempt to piggyback on Rep. Byron Donalds's astute assessment of Social Security's problems falls flat when he compares its returns with that of the S&P 500 ("Byron Donalds Schools Joy Reid on Social Security," Upward Mobility, Jan. 25).
With significantly lower volatility, returns uncorrelated to the market, caps and floors on returns and inflation protection, Social Security much more resembles a bond than stocks. In that light, a long-term return of "less than 6%," assuming an unchanging normal yield curve, is fine.
Those looking to amp up every last dollar of wealth can adjust their non-Social Security assets to reflect its fixed-income characteristics in their portfolio. The tens of millions relying on Social Security as their only retirement asset, however, can take comfort in the program's steady payments, which help keep them from starving in the cold and dark -- Social Security's original reason for existing." [1]
1. Social Security's Return Is Good Enough for Retirees
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 31 Jan 2023: A.14.
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