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If people who work for 45 years earning $50,000/year were allowed to invest half of their Social Security taxes in personal accounts with returns equal to the worst 45-year period of the S&P 500 from 1926-2013, how much money would each of them have?

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From 1926-2013, the worst 45-year period of the S&P 500 yielded an annual real return of 4.6% per year. Given this return and relatively high administrative costs, each person would have $427,892. If the return reflected the average performance of the S&P 500 and average administrative costs, each person would have $879,800.

DocumentationSocial Security Personal Accounts




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