June 5, 2026 – Almost to the day, today, eight years ago, was my last day at work. One thing I always looked forward to in retirement was never having to pay those dreaded payroll taxes again. Alas, eight years into retirement, I’ve picked up a few side gigs to stay involved and now run my own small financial advisory business. Not only do I pay Social Security and Medicare taxes again, but I now pay the full 12.4% Social Security and 2.9% Medicare taxes, i.e., the employee and employer portions out of my pocket. Ouch! I had hoped I would never have to put money into that stupid Social Security Ponzi Scheme again. Oh, wait, what did I just say? I must have heard this somewhere, probably from Elon Musk on Joe Rogan’s show. He probably said this mostly for the shock value without thinking too much about the financial nuances.

Nevertheless, the Ponzi Scheme comparison got me thinking: While Social Security is certainly not a literal Ponzi Scheme, where some scam artist runs off with the money, and the investors lose all their funds, is Social Security a Ponzi Scheme, at least to a degree? Are the ways in which Social Security differs from a Ponzi Scheme really only distinctions without a difference? How much better could I have done if I had invested my personal payroll contributions into the stock market or some other financial asset portfolio? All interesting questions! Let’s take a look…