GOP Tax Plan: are they insane or are they saviors?
As the days pass, the GOP continues to tinker with tax reform trying to create a new tax plan for the nation. The latest idea floated is another alteration to 401(k)plans. This is not the first time the GOP proposed […]Read more
Income in retirement is not what you think when your health is on the line
For those in and heading towards retirement when it comes to generating income there may be some hard truths that may appear along the way as federal regulations surrounding health coverage tend, at times, to not be planned for adequately. […]Read more
U.S. Debt is over $20 Trillion…don’t worry about it, you will pay it down…really.
- 401(k), Fidelity Health Care, financial planning, Hold Harmless Act, IRMAA, Medicare, Part B, Retirement, Roth, Social Security
It is being reported that the U.S. debt is over $20 Trillion and for many there is a belief that there is no turning back as there would appear to be no ability to even attempt to pay off this huge amount […]Read more
The Traditional 401(k)…The Big Lie!
Through the years there have been lies said on almost a daily basis. Today, one of the biggest just happens to come when the advice of investing for retirement is to take advantage of an employer’s Traditional 401(k) plan. The […]Read more
Traditional 401(k) or Roth 401(k)? It may all come down to planning for your health
The choice of investing into a Traditional 401(k) or a Roth 401(k) has been a debate since the Roth was designed and consensus tells us that they way to go is with the Traditional 401(k) as that is how many […]Read more
Planning for healthcare in retirement – some pros & cons of investment products
- 401(k), financial planning, Health Care, Healthcare Costs, Life Insurance, Medicare, Retirement, Roth, Roth 401(k), Roth 403(b), Social Security
As you may already know by now, you will have a mandatory expense in retirement known as health coverage, and surprise! – it will be determined by the amount of income you will have in retirement.
In 1993 there were changes to Social Security’s Program Operations Manual System (POMS). A person receiving Social Security Retirement benefits must also accept Medicare Part A, or else face the penalty of having to forfeit all current, future, and even past Social Security benefits.
Granted, Medicare Part A is free if you meet the same 40 quarters definition for Social Security. But Medicare Parts B & D are not free, and they both come with a late penalty for delaying enrollment past age 65. There are also surcharges to the Part B & D premiums for anyone earning “too much” income.
The income test that is used, as defined by Social Security, is “your adjusted gross income plus any tax exempt interest you may have or everything on line 37 and 8b on the IRS form 1040.” The technical term for this income is Modified Adjusted Growth Income, or MAGI.
Some examples of income that are part of MAGI: Wages, Social Security, most Capital Gains, all Dividends, Rental & Pension Income, withdrawals from most retirement savings plans, and even most Annuities.
Unfortunately, certain Medicare premiums and all surcharges due to income, along with any late penalties, are automatically deducted from any Social Security benefit you may receive. So what you think you may be getting in terms of a benefit may not actually be what you ultimately receive.
Below is a list of some of the popular retirement options, and how they may or may not affect your future health costs. (more…)Read more
Chris Christie’s plan to save Social Security by taking away your benefit. Unfortunately it has already be done!!!
- 401(k), Chris Christie, Dan McGrath, Fidelity Health Care, Healthcare Costs, Medicare, Medicare Modernization Act, Social Security
Do you ever get the feeling that the country has either checked out as a whole, or has been brought back to life by Dr. Frankenstein using Abby Normal’s brain?
New Jersey Governor Chris Christie announced his steps to save the Social Security program for the entire country the other day in New Hampshire, and the frightening part is that he’s either just laughing his ample arse off because he knows that too many Americans have no idea what has already happened to them, or he too is truly Abby Normal.
Mr. Normal’s plan – that is, Gov. Chris Christie’s plan – is to “reduce Social Security benefits for retired seniors earning more than $80,000 and eliminating the benefit entirely for individuals making $200,000 and up in other income, along with raising the retirement age to 69 from 67”.
Here is the punchline, folks: IT HAS ALREADY HAPPENED! (more…)Read more
And the Regulations will be Televised
- 401(k), ACA, Affordable Care Act, Congress, Dan McGrath, Fidelity Health Care, financial planning, Healthcare, Healthcare Costs, Healthview, Medicare, Modern Healthcare, Obamacare, Part B, Part D, Retirement, Social Security, the Budget
Back in 1997, our government began its quest to tackle the unsustainable increase in healthcare spending by enacting legislation which created a formula, aptly titled “the Medicare Sustainable Growth formula”, through the Balanced Budget Act of 1997 (BBA).
This formula was designed to limit the “growth in spending for physicians’ services by linking updates to target rates of spending growth. The law provides for a mechanism for enforcement of the target rate of growth. When spending increases exceed the targeted rate of growth, payments are automatically reduced across the board”. (more…)Read more
That Traditional 401(k) is bad for your health when it comes to retirement
Americans who are planning and saving for retirement can often expect to hear financial experts dole out the following advice: Invest in your company’s Traditional 401(k), but the problem, though, is that a Traditional 401(k) is bad for your health.
The advice resonates well. Where else can one have the advantage of taking pre-tax dollars and investing them into the stock market, and with the possibility of receiving a “company match”? A company match is where the employer also invests “free money” into your account under some agreed-upon formula (e.g., dollar for dollar up to 6% of your contributions). This does have a lot of appeal.
Americans, for the most part, have seized upon this retirement savings vehicle in bold fashion. According to the Investment Council Institute (ICI), as of June 2014 there was roughly $4.4 trillion in these accounts alone. This is a growth of 50% in just 9.5 short years!
Amazingly, 401(k)’s make up just under 20% of all assets earmarked for retirement. The total retirement allocation is just over $24 trillion. One has to start to believe that all of the doom and gloom about Americans not saving enough may just be a tad bit overblown. It would almost appear that a good chunk of the majority has actually done the responsible thing and saved for their futures. (more…)Read more
4 reasons why you need life insurance that no financial firm will tell you
When it comes to retirement planning, investing and insurance there is no shortage of financial (*cough*) “experts” who espouse the supposed sage advice of eschewing permanent life insurance vehicles such as Whole Life Insurance, Universal Life, or Indexed Universal Life in favor of Term Life Insurance.
They recommend taking the premium savings and investing the difference in the stock market. All one needs to do is scan the internet for quotes from the likes of Suze Orman, who is on record as stating that she “HATES WHOLE LIFE INSURANCE”, and that everyone should just buy Term Insurance.Read more