Retirement Tax coming?

[BMBiology]

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"For the past two years, a commission made up of 19 high-profile people from the academic, political, business, and investment worlds has been busy devising a bipartisan plan to strengthen the retirement security and personal savings of Americans. The result, a comprehensive 146-page report from the Bipartisan Policy Center packed with ideas, came out today.

A lot of high earners are going to hate it.

One of the report's many proposals would raise the taxable level of Social Security earnings to $195,000 from the current $118,500 by 2020, part of a broader plan to "renew the promise of a comfortable retirement, across the income spectrum, for current and future generations of Americans."

http://bloom.bg/1Ycpj0f


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[Carol is Alpha]

"For the past two years, a commission made up of 19 high-profile people from the academic, political, business, and investment worlds has been busy devising a bipartisan plan to strengthen the retirement security and personal savings of Americans. The result, a comprehensive 146-page report from the Bipartisan Policy Center packed with ideas, came out today.

A lot of high earners are going to hate it.

One of the report's many proposals would raise the taxable level of Social Security earnings to $195,000 from the current $118,500 by 2020, part of a broader plan to "renew the promise of a comfortable retirement, across the income spectrum, for current and future generations of Americans."

http://bloom.bg/1Ycpj0f


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This is what I mean by that huge wave coming to delever the system--a combo of default, devaluation, and taxation-- covert and overt wealth confiscation.
There may be no winners left standing after this wave, at least anybody able to enjoy the fruits of their decisions during their remaining lifetime. Wealth may have to go into hiding to be passed on to clan members of the next generation or two. Financial cicadas.

 

[WVUPharm2007]

It's a long term necessity. With the death of labor as a means to provide for oneself due to automation and AI advancements, there will slowly be fewer and fewer ways to "get ahead" and make a nest egg or yourself. It's either this or millions and millions of old people in crippling poverty. There really isn't a middle class anymore and we are witness to what looks like the beginning of end-stage capitalism. i.e. Massive wealth stratification.

 

[Carol is Alpha]

It's a long term necessity. With the death of labor as a means to provide for oneself due to automation and AI advancements, there will slowly be fewer and fewer ways to "get ahead" and make a nest egg or yourself. It's either this or millions and millions of old people in crippling poverty. There really isn't a middle class anymore and we are witness to what looks like the beginning of end-stage capitalism. i.e. Massive wealth stratification.

Oh they've got plenty tricks up their sleeves. Can't you hear that thumping in the distance. What is that? ....heavy lift choppers methinks.
Helicopter money is coming in many different forms. Basic Guaranteed Income is one of them.

 

[wagrxm2000]

This is what I mean by that huge wave coming to delever the system--a combo of default, devaluation, and taxation-- covert and overt wealth confiscation.
There may be no winners left standing after this wave, at least anybody able to enjoy the fruits of their decisions during their remaining lifetime. Wealth may have to go into hiding to be passed on to clan members of the next generation or two. Financial cicadas.

Possibly the most annoying person on this forum and this includes anti-flu boy.

 

[wagrxm2000]

Just raise the retirement age and increase the tax by 1%, that's not going kill anyone's paycheck.

 

[WVUPharm2007]

Oh they've got plenty tricks up their sleeves. Can't you hear that thumping in the distance. What is that? ....heavy lift choppers methinks.
Helicopter money is coming in many different forms. Basic Guaranteed Income is one of them.

Something has to change. If the world carried on status quo into a dystopia where a small portion of people (and, trust me, that won't include you even though you appear to be delusional enough to think it will) have all the resources and everyone else (this will be you, me, and everyone else on here) fights over scraps, the world is going to go French Revolution on the rich people and they will get their **** taken, anyway. The rich aren't ****ing stupid. They are going to let BGI happen. It's the cost of doing business. They like their heads attached to their bodies.

 

[Carol is Alpha]

Something has to change. If the world carried on status quo into a dystopia where a small portion of people (and, trust me, that won't include you even though you appear to be delusional enough to think it will) have all the resources and everyone else (this will be you, me, and everyone else on here) fights over scraps, the world is going to go French Revolution on the rich people and they will get their **** taken, anyway. The rich aren't ****ing stupid. They are going to let BGI happen. It's the cost of doing business. They like their heads attached to their bodies.

BGI will only buy time. Most of the income will be used to delever, not for consumption. The virtuous cycle of credit growth is no more. As evidenced by the data in China, we've passed the Schwarzschild radius of the deflationary black hole at the center of our financial milieu and the vicious cycle of debt deflation is upon us, Kralizec, The Typhoon Struggle of our epoch.

The evidence of this is all around you. Almost all the new threads are derivatives of this theme. Everything in our lives has been financialized, collateralized. That's why after the housing crash they went ahead with the student loan and subprime auto bubble in full gear. They are running out of things to collateralize. What we are seeing is the end of the central banking bubble that started in 1605.

PS. I enjoy the debate with you.

 

[genesis09]

To solve the social security problem you need to get rid of the cap and/or raise retirement age. You don't have to raise the tax if you just end the cap or even have a graduated tax.

 

[RPh Who]

Weaning the population off of socsec would be ideal. Perhaps they could give younger earners paying their socsec tax who wouldnt see paymenrs when they retire the ability to contribute more to Roth or tax advantaged accounts would be a good compromise.

 

[awval999]

Weaning the population off of socsec would be ideal. Perhaps they could give younger earners paying their socsec tax who wouldnt see paymenrs when they retire the ability to contribute more to Roth or tax advantaged accounts would be a good compromise.

You can't trust the people to save for retirement. If it's not mandatory like SS then we will just have to support them when they are old.

The people have decided we won't let the elderly die in the streets. So this is the next best thing.

 

[297point1]

we've passed the Schwarzschild radius of the deflationary black hole

Come again?

 

[wagrxm2000]

Weaning the population off of socsec would be ideal. Perhaps they could give younger earners paying their socsec tax who wouldnt see paymenrs when they retire the ability to contribute more to Roth or tax advantaged accounts would be a good compromise.

Horrible idea, I believe every time I read how much do people have saved its usually like $1000. I may not like being taxed to pay for everyone else but its better then the elderly dying on the streets.

 

[WVUPharm2007]

Come again?

People that are against he idea of a central banks have been calling for massive, massive inflation since 2009 or so. It didn't happen. We had deflation instead. Dude is saying that deflation is past its saturation point and inflation/collapse of money as a concept is inevitable.

Which I obviously disagree with, but whatever.

 

[Mad Jack]

You can't trust the people to save for retirement. If it's not mandatory like SS then we will just have to support them when they are old.

The people have decided we won't let the elderly die in the streets. So this is the next best thing.

Enforced retirement savings are another option, as is done in Australia. Instead of handing your cash off to the government to spend it on wars or whatever, you are forced to save and invest it, but it's yours to keep.

 

[BMBiology]

Social security is not welfare. You get whatever you put in. That is how the system works.

The problem is a lot of people don't know what is poverty. They don't want to save for retirement because they want to live today, not tomorrow. Certainly everyone can contribute an additional 1% of their income toward their retirement but they are not willing to give up their daily Starbucks, their cable, their nice cell phone. That is their choice but don't expect me to pay additional 6.2% and my employer to pay another 6.2% (geez, I wonder where is that money going to come from) so you don't have to save for retirement.


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[BMBiology]

Another thing...social security is taxable income. People who save a lot for retirement are already going to pay a good portion of their social security income to the government.


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[UofK]

Horrible idea, I believe every time I read how much do people have saved its usually like $1000. I may not like being taxed to pay for everyone else but its better then the elderly dying on the streets.

Personal responsibility...must have died several decades ago along with those that believe in it.

 

[Old Timer]

Another thing...social security is taxable income. People who save a lot for retirement are already going to pay a good portion of their social security income to the government.


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Really. I hate factually true statements that are really lies.

If your social security is $3k per month and you are married and earn 50K per year, then 50% of the SS is taxable. That's 18K. Bow you would be in the net 10% bracket so it would cost you $1800.00. Really. That's a hardship?

Yes it is taxable but the tax is so small as to be negligible. You would have to have an IRA or 401K at 70+1/2 of over 1.4 million to get 50K of taxable income. SO, my heart bleeds for you with the extra 1800 in taxes.....

 

[wagrxm2000]

Personal responsibility...must have died several decades ago along with those that believe in it.

If you work retail you'll know the answer to that, how many times do you hear I have to wait for my check before I can afford my meds?

Also, have you read some of these threads? Even pharmacists gave no clue how to save.

While a waste of investable money, its still best for most people.

 

[BMBiology]

Really. I hate factually true statements that are really lies.

If your social security is $3k per month and you are married and earn 50K per year, then 50% of the SS is taxable. That's 18K. Bow you would be in the net 10% bracket so it would cost you $1800.00. Really. That's a hardship?

Yes it is taxable but the tax is so small as to be negligible. You would have to have an IRA or 401K at 70+1/2 of over 1.4 million to get 50K of taxable income. SO, my heart bleeds for you with the extra 1800 in taxes.....

Look at how things are going. Do you really think the government is not going to look at other ways to add more tax to people who save over the years so they can have a peace of mind when they retire? 401 k, IRA, social security, pension...all of them are taxable income.


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[pezdispenser]

Really. I hate factually true statements that are really lies.

If your social security is $3k per month and you are married and earn 50K per year, then 50% of the SS is taxable. That's 18K. Bow you would be in the net 10% bracket so it would cost you $1800.00. Really. That's a hardship?

Yes it is taxable but the tax is so small as to be negligible. You would have to have an IRA or 401K at 70+1/2 of over 1.4 million to get 50K of taxable income. SO, my heart bleeds for you with the extra 1800 in taxes.....

Actually that's not quite correct either.

https://www.ssa.gov/planners/taxes.html

If you're married and your income + half of your SS benefit itself is from $32k-44k, then 50% of your SS is taxable. If over $44k then 85% of your SS is taxable.

The 85% rule was added in OBRA 93. Furthermore, the $32k/44k thresholds do not increase with inflation, so eventually almost everyone will be paying taxes on their SS. I also think the government will try to find ways to further reduce SS or increase taxes on high income retirees.

 

[Old Timer]

Actually that's not quite correct either.

https://www.ssa.gov/planners/taxes.html

If you're married and your income + half of your SS benefit itself is from $32k-44k, then 50% of your SS is taxable. If over $44k then 85% of your SS is taxable.

The 85% rule was added in OBRA 93. Furthermore, the $32k/44k thresholds do not increase with inflation, so eventually almost everyone will be paying taxes on their SS. I also think the government will try to find ways to further reduce SS or increase taxes on high income retirees.

I'm aware of that, but most people over 70+1/2 are not making that money and then you still have deductions. So it's really not a big deal.

 

[BMBiology]

I'm aware of that, but most people over 70+1/2 are not making that money and then you still have deductions. So it's really not a big deal.

Remember you were born before the Internet was invented. Things are changing. Savers will be taxed heavily during their retirement. It is not inflated adjusted so many more will get hit.

It is just a number game now. Either tax everyone or just tax the top 10%. The part that I don't get is...we are not even in the top 10% if you include student loans and the years we spent in school.

Right now I am putting 18 k in my 401 k and with the match, that is about 25 k a year toward my retirement. This makes me wonder how much of my retirement money will go toward someone's else retirement.


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[Old Timer]

Remember you were born before the Internet was invented. Things are changing. Savers will be taxed heavily during their retirement. It is not inflated adjusted so many more will get hit.

It is just a number game now. Either tax everyone or just tax the top 10%. The part that I don't get is...we are not even in the top 10% if you include student loans and the years we spent in school.

Right now I am putting 18 k in my 401 k and with the match, that is about 25 k a year toward my retirement. This makes me wonder how much of my retirement money will go toward someone's else retirement.


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I have a hard time with your attitude. I graduated in 1982. I made $12.50 per hour and worked 45 hours per week. That's $29,250.00 per year. According to the BLS adjusted for inflation that's $72,522.12. Without bonus I make 169K per year. I have beaten inflation by almost 100K per year. The median US salary is a little over 50K per year. I am in the top 10%. You make a good living. Enjoy what you have. Remember what the wise man said. Who is rich? He who is satisfied with his portion.

 

[BMBiology]

Like I said you were born before the Internet was invented. You just needed a 4 year degree to work as a pharmacist. You didn't have much or any student loans.

Salary only jumped in the late 90s and 2000s because every retail chain wanted to get into the pharmacy business.

If you had graduated today, most likely you will have 200 k+ in student loans, will be 28-30 years old, and will be fighting for 40 hours a week while making 10% less than a pharmacist who graduated before 2010.

Why is this hard to understand?


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[Old Timer]

Like I said you were born before the Internet was invented. You just needed a 4 year degree to work as a pharmacist. You didn't have much or any student loans.

Salary only jumped in the late 90s and 2000s because every retail chain wanted to get into the pharmacy business.

If you had graduated today, most likely you will have 200 k+ in student loans, will be 28-30 years old, and will be fighting for 40 hours a week while making 10% less than a pharmacist who graduated before 2010.

Why is this hard to understand?


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You still make six figures
All new hires are 40 hours a week
New hires are not making 10% less than grads from 2010.

Be grateful where you are. Enjoy your life. Or better yet, change careers.

 

[genesis09]

The internet was invented in the 1960s. The World Wide Web was invented in about 1990. We use the two terms interchangeably but they are actually two different things. I was born after the internet but before World Wide Web.

 

[BMBiology]

You still make six figures
All new hires are 40 hours a week
New hires are not making 10% less than grads from 2010.

Be grateful where you are. Enjoy your life. Or better yet, change careers.

You are right. I am grateful.


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[Old Timer]

You are right. I am grateful.


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Then stop whining......

 

[BMBiology]

Then stop whining......

You are about to retire. You got nothing to worry about. These changes won't affect you.


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[Old Timer]

You are about to retire. You got nothing to worry about. These changes won't affect you.


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Since you think everyone has it better than you. I hate to tell you that working for independents for the first 18 years of my career left me with no pension/401k/403B at all. So, I am well behind the 8 ball. Save as much as you can and don't worry about bogey men that only exist in your imagination

 

[BMBiology]

Since you think everyone has it better than you. I hate to tell you that working for independents for the first 18 years of my career left me with no pension/401k/403B at all. So, I am well behind the 8 ball. Save as much as you can and don't worry about bogey men that only exist in your imagination

Uhh you could have put money in an IRA. You didn't even know how social security is taxed so I am not surprise you didn't know.

And yes, I would like to keep as much of my retirement money as possible.

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[Old Timer]

Uhh you could have put money in an IRA. You didn't even know how social security is taxed so I am not surprise you didn't know.

And yes, I would like to keep as much of my retirement money as possible.

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I didn't say I didn't have an IRA. I made nothing and I had nobody matching 5% of my income like I do now.

I hope you keep all your money.

 

[Ackj]

Without bonus I make 169K per year.

New hires are not making 10% less than grads from 2010.

You're right, I'm not making 10% less. I'm making 30% less apparently.

 

[Carol is Alpha]

People that are against he idea of a central banks have been calling for massive, massive inflation since 2009 or so. It didn't happen. We had deflation instead. Dude is saying that deflation is past its saturation point and inflation/collapse of money as a concept is inevitable.

Which I obviously disagree with, but whatever.

No, I'm saying nothing can stop deflation now. Once you cross the Schwarzschild radius of a black hole , there is no coming back. Nothing they do can stop the deflationary contraction of too much debt. Inflation requires credit growth. Nobody wants to take out anymore loans. The world wants to pay back its loans, delever.
If left to nature, the bond markets would eventually realize the money is not going to be paid back and then bondholders would panic. The higher monetary aggregates collapse into the lower ones. Nobody wants to be a creditor. But we have central banks with balance sheets with no bounds. They will, if need be, vacuum up every debt instrument out there. Witness the ECB buying corporate debt now. Outrageous, but it's happening.
Nothing will stand in their way.

They will finish what they started by monetizing every bit of debt out there.



But they will fail and in the end turn the starkiller weapon that had elevated bond prices onto another asset on their balance sheet to save themselves.

 

[Old Timer]

You're right, I'm not making 10% less. I'm making 30% less apparently.

Except I graduated in 1982, not 2010. I also took every **** job my boss asked me to and racked up raises each time. That along with the shortage in the early 2000's drove my salary up.....

 

[ldiot]

Penalize those who save, reward those who don't. Demonize success, hard work, and responsibility. Convince yourself that you are a victim to cope with your personal shortcomings.

Another mechanism of increasing taxes, increasing government influence, and redistributing wealth. I personally would prefer to opt out of SS altogether and keep my money. Other people spending other people's money on other people is inherently inefficient.

It really is amazing... one of the top standards of living here in the USA and half the population believes that they are a "victim" of capitalism.