There are many good posts (and a few not so useful extremist posts) so I'm going to give you an anecdotal case and you can do as you like with the accurate information.
In my lifetime I earned about $6M. I paid $180K into SS and another $180K into Medicare. It took me almost 55 yars to do this.
I retired in my early 50s unofficially and I calimed my Medicare at 65 and my SS at 66. According to SS (those annual statements they send you), I have paid in the MAXIMUM and thus received the MAXIMUM check that a 66 year old could draw which was $2144 (it's gone all the way up to $2177 now
). So, assuming that I garnered no interest, it will take me 8 years to recover my "investment". If SS had bought me a T-Bill every year, at the current rate of the time, I figure I would have doubled my money by the time I started to draw. So, it will take 16 years for me to feel like I broke even on the deal.
That would mean I will be 82 when I hit break-even. As per the actuarial tables, I will die at 77. As per my family history, I will die in my early 90s (my Mom died voluntarily at 93 and my Dad died a natural death at 100). But they hadn't tried pot, smack, crck, speed and other stuff that I, a garbage-can junkie, have put in my system (in the past - I barely and rarely misbehave now
Now, I earn about $25K a year from investments and I get another $25K from SS. That's 50K a year total income. But I spend more than that - I support my ex-wife, I've gifted my son and I have a bst friend who is like a daughter to me and I've helped her buy a house and a car and such-like. So, I consume my savings at the rate of $25K a year. Tis means I will use up about $500K of my savings before the cats and I go to the Rainbow Bridge.
I'm not sure how losing my SS might affect me. Would I stop my generosity and live within my means as I did when I worked? Should I lose my SS because I did save more than $500K? If so, would that be because of the $25K I make on my own or because of my assets?
SS is not means tested which means that Mitt Romney and Specklebang get pretty much the same amount. Rumor has it that Mitt has saved more than I have - should we punish him for this? While I despise the term "slippery slope", it might just be appropriate here.
In the past, I've advocate a Mandatory Savings Account as an alternative to SS but I know this has about the chances of a snowball in hell. Why? Because those that are good at making money love the idea but those who don't make much are fearful they might not save up enough to get a lifetime of checks.
OK, I wrote this so either side can know exactly how this works. Hope it was helpful.
