You may agree or disagree and that’s fine either way. Feel free to ask a question when appropriate.
Please comment in a post or reply to another readers comments.
We can’t control what others do and we can’t stop misfortune from striking. But we can control our own actions. Those who are financially prudent will most likely enjoy success, even if events don’t always go their way.
QUINNSCOMMENTARY 
Could I get someone to give me the instructions oh how exactly to post a reply to one of the postings? I wrote the same reply twice yesterday and after writing it, WordPress asked me to sign in which I did and I hit reply and then the reply has never posted. I don’t know what I’m doing wrong? I’m trying to post this and can’t seem to do even this. Below now it says “Type / to choose a block” ??? Any help? R.Blanchard
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Quite impressed Mr. Quinn with your art skills.
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Hi
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Got it
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I enjoyed seeing your artwork !
So beautifully done I love to zoom in and see all the detail. Thank you for sharing, I hope you will post more !
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Why does our company allow After Tax contributions in the 401K before ones reaches the yearly limit of $22,500 for those under 50 years old (at which time it gets redirected to After Tax). Shouldn’t the company “just” provide the option for the Roth 401K for these contributions? I know so many people that contribute during the year to the After Tax category. I do not understand…as all the compounded earnings/growth on this money will be subject to income tax when withdrawn. If they only checked the other box, this money’s future growth will be tax FREE. There is such a lack of knowledge with the Roth 401K program. In my opinion, the ROTH is better than sliced bread. Another trick employees should do is review any After Tax money in their 401K and do an in service roll over into a ROTH IRA. Again, to get this future growth tax free. No matter how small this amount may be, the compounded return over 20 or 30 years can be significant !!!
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Richard,
Regarding this paragraph from Today:
1. The pause that refreshes. It amazes me how much soda makes its way into shopping carts. Americans consume 39 gallons of soda per person per year. Who needs all of that? Where I live, a case of 12-ounce cans is about $25. Skip one case a month and you can accumulate $38,000 in 40 years.
Are you kidding, what kind of soda cost $25 for 24 of the 12 ounce cans. It should be about $10 for cost of 24 cans of Pepsi, unless your soda is Beer that is more like $25. Just saying.
Bill
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As a matter of fact on Amazon today a case of 20oz of Coke is $46.99, but the point is not the price, but the concept that saving a little can add up to a lot.
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Quinn, I have been giving some thought about possible future directions that might help the Social Security program. Do you publish guest writers, or write articles based on what someone sends? Thanks,
Al
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hi richard
i follow you @ humble dollar.com, and enjoy johnathan’s ideas as well as your own
your recent post – it took decades – stimulated my thinking
you seem to have it all together- years of hard work, investing regularly, frugality within reason, providing for family, etc
your comments on how you accumulated your wealth, and in particular how it is positioned caught my eye
you comment that you have both your pension, and a fair amount of your equity holdings, with your former utility provider
if you were looking at another individuals portfolio would you endorse having both in the same place?
without you revealing (understandably) the name of said former employer onlookers cannot assess it’s financial stability –
however these days anything goes, and what was once very stable can become unstable in short order, particularly with all the fiat money the fed continues to print and the amount of unsustainable leverage carried by even the most flush of companies
unless significant capital gains taxes would be incurred, should you perhaps consider decreasing your equity holdings with your former employer since your pension, and your spousal portion should you pre decease her, will continue coming from there as well?
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I surely agree about putting all ones eggs in one basket, but in my case that chunk of my assets in former employer stock equals about 13% of the total and I have no employer stock in my 401k. The employer is one of the largest utilities in the US and has been around for well over 100 years. I would never advise an employee to invest in their employer as part of retirement assets (think Enron). But many still do and in my old employers plan and the irony is over many years it has outperformed other investments
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thanks for the clarification richard
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I read your article on “Should you feel guilty because you retired wealthy” and wanted to share a few thoughts. First, no, you absolutely shouldn’t, but there’s a caveat. I’ve worked hard my entire life. I’m very frugal, and I have tried my hardest to get into a position where I can retire and survive. Unfortunately, sometimes there are far more lemons in life than the amount of sugar to sweeten the lemonade. I have an affluent circle of friends. They have very secure retirements and, I realize they are not trying to be mean, they tend to say…. You should have done this or that. Well, sometimes life just happens and you either learn to roll with it or you just crumble. I started my life as an Army wife. Unfortunately, after 15 years of sacrifice you don’t get any benefits when you get divorced. You do find out how harshly living over seas impacts your social security though. As a very successful realtor in 2005 in Detroit, the recession that kicked off the great recession destroyed my SEP, and getting back to the possibility of having a stable retirement has become elusive. I’m not looking for anyone who has a solid retirement to do anything for me, but I do think that most people, even close friends, who have been able to retain what they worked for need to have empathy for and be less critical of someone like me. If I’d had a crystal ball, I’d have done things differently, but I didn’t and no one can change the past. That doesn’t mean I haven’t worked just as hard (if not harder, because sales is a grind), and the fact that I don’t have a solid retirement shouldn’t become a criticism of my work ethic. Sometimes life just doesn’t go the way you plan.
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Of course you have some valid points, sometimes things happen over which we have no control. But I am curious about your SEP being destroyed. In 2008 and again in 2020, the market decline was followed by a big rise and in both cases there was opportunity for significant growth.
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The market didn’t kill my SEP. Trying to keep bills paid along with desk fees, I did the typical thing and withdrew my SEP 100% commission on $0 is always 0! If I knew then what I know now…. The worst part was about 60k was invested in this little pharmacy called CaremarkRX. Hindsight is always 20/20. I do my best not to think about it. If I’d have cut my losses and moved out of Michigan right away, my retirement would be set just from Caremark. Since then jobs simply haven’t paid enough to get good footing. I moved to Arizona in 2006, and I by the end of 2008 I was at a car dealership doing fantastic, but it took 9 months to build a serious pipeline. Then the country wide recession hit. I just started doing anything I possibly could, but admin work doesn’t cover much. I was finally getting some money in my 401k again and then Covid happened. A large part of my 401k was company stock. I was far too heavy on company stock, but I worked for Dish Network and I was waiting for the big bump Dish was going to experience with the Boost Mobil and Sprint Spectrum licenses about to close, but covid happened so my gamble ended up hurting, a lot! That gamble I wouldn’t change. But if I could change cashing out my SEP (or at least just keeping the Caremark piece alone) I certainly would. Sigh…. Life is a hell of a thing to happen to someone!
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I’m so glad to see you do make a point to invite comments as read and loved your article on what retirement really is like! It’s one of the clearest interesting articles on the subject and I saved it. Why? Because I am in a retirement program that Last 5 Years and I have two years left and I always thought it was important 2 have a direction after retirement and not really retire one’s life but change direction! I want retirement to be fun and full of things I haven’t been able to do while working for too long! I subscribe to your newsletter as well. There’s just something about the information that was worth it for me thank you
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I appreciate your blog Mr Quinn, even tho I don’t always agree with everything. As a future blog post, could you please explain why Bernie Sanders repeatedly states that “Americans pay twice as much for health care as the rest of the world”? Is that a true apples/apples comparison for the same medical procedures and quality? Or are Americans twice as sick therefore spending twice as much? Or is he talking about health insurance? I am not interested in politics, but the facts. Thx for considering!
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Sanders problem is that he doesn’t distinguish between actual health care spending and insurance premiums. Two different things. Americans do pay more, but there are many reasons including we are one of the most obese countries in the world. He also fails to point out all the constraints and limitations other countries use to contain costs, things that Americans may not accept. I was just speaking with a friend last night whose mother lives in England. She had to wait six months to get a cataract operation. In Spain they assign you doctors and a hospital and you have to get government permission to change. In the UK the standard is a four bed hospital room, not two. It goes on and on while all the other systems also use insurance in some manner and yet they all still struggle with costs on an ongoing basis. Imagine if we have a M4A system with a budget. What happens if we go over budget. Sanders is no doubt well meaning, but incredibly naive as well and so are his young supporters IMO
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Richard, found your blog/commentary by way of “Humble Dollar”. Have now read several of your posts, and have enjoyed them greatly. I’ve been a “saver” all of my life, and I’m now approaching retirement after 34 years with my employer. Of course I’ve been reading any and all books and blogs on personal finance and retirement for several years. I was curious, are there any books or blogs that you would recommend? Thanks for all the blogging and tremendous amount of information you provide.
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The last two I read were “From Here to Financial Happiness, by Jonathan Clements.
and Retirement Reality Check by Jalinski. Both are available on Amazon
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In memory of Edmund Burke, who initiated the Paymaster General Act of 1782, which disallowed government paymasters to draw on money from the Treasury at will, a sculpture by Michael German came to mind of a wiseman bending to pick up a hitherto unnoticed corroded penny he is standing on. I find it sociologically significant that this sculpture was not produced for decades and has been reinstated only in 2013. Dr. G.Heath King
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Quinn, you’re an idiot! Worse. You are acting like a shill for bought-and-paid-for conservatives, healthcare companies and Wall Street. Why are you doing this? You are trying to convince people that they should be happy struggling to make ends meet in the wealthiest country in the world; that they should be happy that the wealth is “trickling down” to them. In your world view, senior citizens and teachers are living rich, luxurious lives and healthcare costs are not bankrupting families and that social security is enough for seniors to live on in comfort. This is not so. Stop lying to your readers.
I’m guessing that you have lived your life in a bubble of privilege and entitlement and so have no clue what the real world is like for middle class families and the working poor.
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Could you be a bit more specific as to what you are talking about? I never said it implied any of what you mention. What don’t you agree with?
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Quinn… while much of what you say is true, much of it is highly misinformed as well. For example, in a recent article you stated that the average adult spends $161/month on clothing. I went to the article you cited, and your source was all over the board in terms of its assertions. The very same article states that the average man spends $323/year ( $27/month) and the average woman spends $571/year ( $48/month) Later, it indicates that a family of 4 with an above average income spends approx $2440 or $51/person per month. I have no idea where they came up with $161/month.
Many, or rather most, of your other assertions were equally uninformed.
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I was not making assertions, merely reflecting a variety of surveys which is about as good as it gets in understanding some spending. Clearly all surveys have their shortcomings. The real point is not that each number is correct, but rather that Americans spend above their means as a group and accumulate a lot of unnecessary stuff in the process. Heck, I just read we spend $550 million a year on Twinkies
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I like all his info. I believe he states in his writings that his approach may be coming a slightly privileged life view, but I would suggest then to at least imagine what the point is for such a person and learn something if possible, to apply to the not-so-privileged view….its something to aspire to dream about isn’t it??? Take care.
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This comment btw was in response to Ms. Ankita’s
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I enjoyed your article (Blog?) on “14 lies about money that Americans can’t seem to shake” that appeared on msn under Market Watch on June 6 2019. I would like to make one comment on #4:
4. “Teachers are underpaid.” It isn’t possible to pay good teachers commensurate with the value they bring to a community or a child. But generally, they aren’t underpaid. Yes, you need to consider their salary. But you also need to consider vacation time, benefits while working and benefits received once retired, notably pension benefits.
Under #4 “Teachers are underpaid.” Your thinking is very good, but there is one common misconception that is perpetuated: that is that teachers get “vacation time.” When I worked as County Planner for some 8 years I did get paid vacation and holiday benefits. After I went into teaching for the next 25 years, I got no paid vacation nor paid holidays. That, I believe is very standard in almost every teacher contract. We used to jokingly call it an annual contract as a (decently paid) day laborer. Also, most school districts pay their teachers only 9 or 10 times a year. The smart teacher’s would take and divide the annual salary by twelve and set up a savings plan to balance the usable funds to cover every month of the year. The medical benefits usually cover the entire calendar year and in many districts continue until the retiree is eligible for Medicare.
Thanks for listening! And I’m going to start following your blog.
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I think if you look at the teacher salary (and benefits) on an annual basis and consider the days and weeks of no school during the year plus the summer break, that would constitute paid time off or vacation. But I can see that if the paycheck actually comes only for 10 months it could be perceived differently, but it is annually salary. If a teacher earns $60,000 and a private worker earns $60,000, the private worker works 262 days less say 15 days vacation That should be compared with a teachers actual work days, right?
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I’d like to add one more money waster to your list: pets. I have two cats who seem to be requiring more and more veterinary care as they age. Once they pass, I won’t be replacing them.
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I also have a problem with some of your points in Market Watch on June 6, 2019. For one, teachers are underpaid. Once, long ago I graduated thinking I wanted to teach elementary school. Then I learned what I would be paid vs what the same degree would earn me in Corporate America. (Spoiler, 2X that of a teacher plus at the time a pension and a 401K.) Even working summers, I was going to have to have 3 roommates vs instead flipping to the dark side and purchasing a house within a year of graduation.
These days I sit on a school accountability board and get to see the balance sheets. In business, I’m paying kids out of school (so like still in diapers needing their nose wiped they are so young) more than teachers at our local school who are 20 yr veterans of education. (60K BTW.) While no one goes into teaching for the money, the pay cannot be so low as to not being able to afford the cost of living, daycare, etc in the communities they serve. Also, my degree in education did not cost less than other degrees. I’m just very lucky financially I decided to not use it.
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First you need to consider total compensation and time worked in a 12 month period. And then you need to consider that the revenue to pay teachers comes from taxpayers who rarely have a total compensation package like teachers and other government employees. There is no real valid comparison with the private sector. Teachers are dedicated people no question, but all things considered I still say they are not underpaid especially relative to the incomes in their communities. In my town the bulk of the tax bill is for education and 60% of that is for pay and benefits.
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Your article had some good and bad points and I hate politics so I’m going to comment on your last item — Shopping carts. With the way most stores are automaticing and cutting workers’ hours and numbers, leaving the shopping cart in the middle of the parking lot means one of the employees has to come pick them up –can have a machine do that!! — so for the little guy it just may be job security for them.
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I think you also get this one wrong:
“Social Security is going bankrupt.” Wrong again. As long as there are taxes coming in, Social Security can’t go bankrupt. But when the Social Security trust fund is depleted, the incoming taxes won’t be sufficient to pay 100% of promised benefits.
It depends, of course, on what you mean by “bankrupt”. That’s a legal term that doesn’t really apply to a government, particularly one capable printing money.
But, colloquially, I think a fair definition of “bankrupt” is whether Social Security will be able to keep the promises it has made to retirees (without inflating it away). And, in that sense, Social Security not only CAN go bankrupt — it is almost guaranteed, given the demographic trends of fewer children and longer life spans.
Will Social Security be able to pay *something* of what was promised? Sure. But, that’s just fudging the definition of bankrupt — if a business can only pay part of its debts, it’s bankrupt!
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I read your “lies about money that Americans can’t seem to shake”.
Some of them were good. If I may suggest, though, I think you’re missing a very big part of the Social Security picture.
Consider your statement: “Nobody stole the Social Security trust fund. It’s invested in special interest-generating Treasury bonds. Last year, those bonds paid $80 billion in interest, which was then used to pay Social Security benefits.”
OK, but tell me…where does the interest on those bonds come from? In other words, who pays the cash to pay the interest? The answer is…current taxpayers!
So, imagine there was no “fund”. Where would the money to pay benefits come from? Um, that’s right, from taxpayers.
So, what difference does having the fund make? Zero, zilch, nada. The bonds the trust fund holds can’t even be traded (that’s what makes them “special”).
Where did the bonds come from? Well, historically, Social Security tax revenue exceeded the benefits needing to be paid. Congress took the cash from that surplus and “bought” these bonds from the Treasury. Then, they spent the cash in the Treasury! The trickery is that they “bought” something they can, themselves, print as much of as they want (these special bonds).
It’s not inaccurate to say that the “fund” is simply an accounting measure of the taxes received by Social Security, but used to pay for other things. It’s incredibly dishonest and almost completely misunderstood by taxpayers.
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I read your article “14 Lies about money that Americans can’t shake” and I must take exception to number 10 Members of Congress are paid too much. You state that they have to either move to D.C. or have two residences which they can’t do on their salaries. I worked in D.C and lived in Norther VA while keeping my permanent residence in Southeastern PA on far less that the salary of a member of congress. I was making $98,500.00 and didn’t have any trouble managing. At the time I had just built a new home and had 2 children, so do blow smoke up my butt about what it takes to keep 2 residences.
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And would you do it knowing you might be out of a job in two years? Or give up running a business for an unknown period? I don’t know when you did what you did, but paying rent and all others expenses, property taxes, etc on net of $98,500 seems unlikely today. What expenses were covered by your employer, if any? In any case, it seems to me if we want quality people focused on the job and not personal gain we should pay more.
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What’s makes them special is they can’t fluctuate in value. The point being made was that nobody stole the SS trust fund.
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What makes them special is that they’re untradable on the open market — that’s why they don’t fluctuate in value.
Any surplus the government received in Social Security taxes was *immediately spent by Congress*. Then, they put pieces of paper into a “fund” and said future taxpayers would pay those pieces of paper off — the same taxpayers that would pay the benefits if the fund wasn’t there. The “fund”, in no way, reduced the financial burden on those future taxpayers.
Do you disagree with any of that?
You can assert over and over again that what they did wasn’t “stealing”. At the very least, I think it’s dishonest. Even when you try to explain it to people, they resist the explanation because it’s so absurd.
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Another way to see how meaningless the “Trust Fund” is:
How Congress takes all government revenue, this year, and “puts it in the trust fund”. That is, they give the money to the Treasury in exchange for 4 trillion or so in “special bonds”. Then, they spend the money in the Treasury as they normally would. We can do that every year! The trust fund will never run out!
Absurd? Well, that’s no different than what’s been happening for the last 50 years.
Did Congress steal the money? Well, depends on what you mean by steal. But, they certainly didn’t do anything that would ease the burden on future taxpayers.
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Funding has been the same way since the start in 1935. Without the interest on those bonds full benefits wouldn’t paid today. Some have proposed a portion of the trust be invested in stocks and bonds and all hell breaks lose. Where can trillions of dollars be invested and safe at the same time?
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Hi,
Read your article article “10 retirement lessons from a retired retirement pro” I would like to ask a few questions.
In bullet 2 about emergency funds you mention that you must replenish it if used. Well, if not working how is that done?
Bullet 5 about inflation, I don’t understand the pool of money concept. I start with a desired salary at 1st yr of retirement and increase each year by inflation…well what my model does…does this accomplish the same thing?
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Thank for your comment. Regarding emergency funds, they are replenished the same way as when working. A portion of your retirement income goes into an emergency fund each month. In other words, you never actually stop saving. Regarding inflation it sounds like you are following the 4% rule and as long as your assets are sufficient to keep up with inflation, I’d say you are fine. My income is fixed, so I use the pool concept as a hedge for the future. For ten years so far my fixed income stream plus SS has been adequate, mostly because I live below my means.
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Thanks for the reply. Okay I had not thought about still contributing once retired. Also since I am not retired yet, I’m modeling what I need for 30 years of retirement. So I start with a Salary at year 1 and then increase it by inflation…not really using 4% rule as after 30 years basically run out of money….no kids LoL BTW the article is not posted on your website? I found it somewhere else.
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I write for HumbleDollar.com too. That’s where you may have seen it or on MarketWatch.
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We have A LOT! in common, I mean A LOT, including walking the streets in Newark NJ looking for a job. What is your email address?
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Rdquinn3@gmail.com
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16 Money Wasters – great article.
I’m sure everyone has additional items to add.
I would like to add payment for storage untis.
It only takes a little bit of time till the cumulative monthly payments exceed the value of the contents stored.
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Generally do not like the concept attached to the word retirement…
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WOW – You missed the really big money wasters – home improvements. We moved to a new
(used) house about 3 years ago. The house purchase price was $207,000. So far, my wife has
spent $20,000 on A/C upgrade so that she could be cool, $2,000 to get interior paint color just
right, $6,000 on a fancy stone patio, $4,000 for various yard improvements, $24,000 for tile floors
and counters in 2 1/2 bathrooms, $5,000 for new carpet (not needed, but not pretty). Just refinanced tp pay off almost $50,000 credit card debt due to the improvements, the appraisal
gave little credit for all the recent improvements, maybe $5,000.
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Can you advise what percent of withdrawal for retirement would be if one was working to age 80?
If the recommended percent is 4% at 65, what would the percentage be for 70,75,80?
I never see any information addressing this question beyond age 65.
Thank You
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That’s 4% rule is now in question. However, there are many factor involved as well as assumptions for earnings on accumulated assets. Also keep in mind that if money is in a qualified plan like a traditional IRA or 401k, the IRS mandates withdrawal rates that exceed 4% after age 70-1/2. In any case here is something from The Motley Fool. “Now contrast that retiree’s situation with that of an 80-year old retiree with the same annual return (6%) Unless he’s Methuselah, he doesn’t need to plan for a 30-year retirement window, so he can safely take a little more from his savings. A 5% withdrawal at this point would be safe; his portfolio might shrink a little as a result, but unless he’s having trouble supporting himself, this shrinkage won’t pose a significant risk to his financial future. However, if he’s determined to leave as much as possible to his heirs, he might stick to a 4% withdrawal for the year instead so that he can keep his portfolio flourishing for them.”
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When the social security retirement age is raised, people who work dangerous jobs are less likely to receive money from Social Security.
When the retirement age is raised, black men and black women are less likely to receive money from Social Security. 1st read this about 26 years ago – differences in life expectancy of black men verse white men.
Raising the Retirement Age: A Sneaky Way to Reduce Social Security Benefits
Some Republicans candidates are promoting a policy change that would hurt workers subsidizing it with a pleasant-sounding phrase
The Atlantic on net – 2015
Over 80,000 have died while on waitlist for Social Security Disability since 2003.
GAO discussed Social Security Disability backlog in 2003.
CBS discussed deaths while on waitlist for Social Security Disability in 2008.
Over $2 trillion of $21 trillion national debt is owed to Social Security.
Most Republicans in Congress chose to murder people. Republicans and Democrats took over $2 trillion from Social Security and then most Republicans in Congress refused to spend the billions needed to end the Social Security Disability backlog by hiring more Administrative Law Judges, other Social Security employees including those who investigate fraud.
Added Sales tax on mining to help pay for Social Security to help Social Security and help deal with harm caused by Mining Law of 1872. Keep in mind I wrote sales tax and not one time royalty fee.
https://www.linkedin.com/pulse/improving-social-security-disability-saving-lives-kenneth-stremsky/?published=t
It is most of my plan for Social Security. It includes ways to bring in new revenues to Social Security and help people save for retirement.
What we should have done in Puerto Rico is discussed using military history including Operation VARSITY World War 2.
Dear R.D. Quinn::
I wrote to GAO dealing with Social Security disability.
GAO wrote me back so I wrote back to GAO about Social Security and other topics.
If you want to get an email from me that includes the letters and some other info, please send me an e-mail.
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The first commandment for retirement should be “don’t use the term ‘retire’ — use ‘transition’, or something that denotes to your brain that you are not stopping, but moving forward to something else. ‘Retire’ denotes ‘stop’ and you don’t want your brain to grasp this thought.
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I’ll buy that. Retire in this sense actually means stop working at a job and most retirees find other activities (like writing blogs😃)
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My wife and I use the word”graduation”. It’s a major change – from what we had been doing to what we will be doing.
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I was surprised when I read your name.
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Good name, right?
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Dick, My wife is turning 65 in October and I’m struggling to find information on whether she needs to purchase A Supplement Plan, Advantage Plan or keep her covered as a spouse under my retiree medical plan. All I can find are definitions of what Supplement Plans are versus Advantage Plans but no guides as to why you would choose one over the other. My wife has no medical conditions and takes no medications. Our out of pocket costs have been miniscule for years. Other that making sure her doctors are covered by a particular plan is there anything else we should consider? I understand that if you don’t sign up for a Supplement plan initially it may be difficult to coverage later for a serious condition. Is it worth paying for a supplement plan now just to ensure that she can get coverage at a later date should it become neccessary? Thanks
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Why wouldn’t you just keep her enrolled as a spouse under your retiree medical plan assuming you can do so for a person on Medicare. Compare what that will cost you with supplemental plan. Advantage plans are mostly like HMOs with restricted networks of doctors.
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Keeping her covered under my retiree plan currently costs $250/mo. Which does not change when she turns 65 and that plans becomes secondary to Medicare. I recently saw where the average supplement plan was about $246 but there are some much less. Since her doctors are covered by most of the networks in locally offered Advantage Plans, why wouldn’t they be a good choice, particularly when they have much lower premiums?
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They would be if you can use your doctors. But I would compare what is covered by your employer plan and other options, including and drug coverage.
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Are you sure that the $250 doesn’t drop considerably when she is covered by Medicare? It should by quite a lot given the plans liability is greatly reduced.
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No her rate doesn’t drop until I turn 65 next year. They won’t tell me what the lower rate would be so it is difficult to make good cost comparisons. I do have the option of dropping her spousal coverage when she turns 65 in Oct. , enrolling her in some something cheaper than $250/mo and waiting until 2019 to evaluate the cost of keeping my retiree coverage going forward.
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If you are still working and you cover your wife she doesn’t need to enroll in Medicare because the employer plan must remain primary coverage until you retire even if you work past age 65. Better check rules with your employer.
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I am retired and will be 65 in Nov 2018. I have checked with my employer and the plan says that our premium is based on my age not my wife’s.
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I really don’t understand how anyone can feel that traditional Medicare coverage in many cases would be a better alternative than a Medicare Advantage Plan if for no other reason is the fact that traditional Medicare has no out of pocket maximums and most Advantage Plans do (the ones that I have researched often max out at around $5-$6000…To me, this is extremely more important than anything else.
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The biggest difference in most cases is the physician and facility networks. Medicare is virtually unlimited and MA typically has relatively small networks.
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Maybe the solution to trying to find a health plan that fits all is Medicare! Everyone uses Medicare for their health plan and no one can sue a doctor!! (At least Medicare doesn’t discriminate against people with existing conditions!!)
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Thanks for your commentary today on drug companies and doctors. Once HR always HR thinking. I miss those tidbits you used to send out thru the company and on email. It’s true. We watch all these commercials and many ask their doctor for those drugs. I look at the commercials; hear all the side affects and think who would ever take that drug??? And Obamacare; they took $738 BILLION out of our Medicare $$ to pay for the plan and the credits given to mostly under 65’s and then tell us the plan is going broke. My one girlfriend works for RWJ and they changed over to the NEW Horizon plan; she needed orthopedic surgery and they have a group that works in EVERY one of RWJ hospitals but they are not on the plan. So she may have to pay 6000 for the surgery she had AFTER Horizon said they’d cover it.
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Yore right, my favorite one is the drug used to treat depression, but a side effect is to increase thoughts of suicide. 😱 I wish I was still sending out those e-mails. I like to think they helped some people.
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I am agreeing with you post on underfunded public pensions. Most long-seniority or retired public employees (the so-called “pension millionaires”) likely realize that promised pensions are unsustainable and THEIR current motive is to “get theirs” before the pension funds and tax aquifers run dry. Keep in mind that it takes $1 million or more set aside to pay a lifetime pension of $60,000 per year and that million increases as you reckon the cost of health benefits and early retirement.
There might be a possibility for a limited federal “guarantee” that states and municipalities could opt into. I am not talking about a “bailout” where federal money would be involved. I am talking about an insurance program that would protect those public pensions that had been actually earned through long service. The monthly amount guaranteed would be capped at a reasonable amount (say $3000) and pensions derived from spiking, double-dipping, etc. would NOT be covered. Furthermore, to have access to this program, the existing pension fund assets that had been accumulated would have to be turned over to the feds to manage (an independent agency free of congressional raids) plus the states or municipalities would have to pledge a guaranteed revenue stream going forward. The pension millionaires would sue, of course, but hopefully they would pay their own legal fees and the lower-paid employees would prevent use of the pension funds to pay plaintiffs’ lawyers. The main object would be to get the existing pension funds set aside to provide benefits over the long term for all employees rather than have those funds used up in the next 5-10 years.
Those who claim public pensions in excess of the guaranteed amounts would have their legal claims, of course and union leadership will go bonkers. They will sue once they miss a pension payment and some courts will say that it’s unconstitutional. However, due to the separation of powers doctrine, courts cannot order state legislatures to raise taxes or to appropriate funds for pension benefits for the few. So the pension millionaires will be suing pension plans whose funds have been set aside for everyone in the system. They will also sue cities and school districts that are essentially bankrupt and which (if necessary) can file for bankruptcy. Many of these plaintiffs may learn that their claims are uncollectable and decide to accept the guaranteed amount.
This idea is “not nice” of course and a lot of peoples’ expectations and plans will be upset. Generally we believe in keeping the promises that are made. However, in the public sector, it’s all the taxpayers who have to part with money to pay people who are retiring in their 50s with COLA-adjusted pensions and lifetime health insurance. These taxpayers have no expectation or hope of pensions and benefits comparable to what has been promised to the pension millionaires. The “fault” probably rests with former legislatures who made large promises to gain votes — but those people don’t have the resources to pay for the damages they have caused … and they probably have immunity from liability in any event. So as a society, we have to work this out in the fairest possible way to everyone.
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I just turned 65 and started Medicare. I am not collecting Social Security. When would I have to start taking Social security Benefits and Paying Part B from Social Security to avoid the Premium Increase.
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As I understand it before 1/1/15 assuming your total modified adjusted income is not above the threshold for the supplemental premium. You would have to check with SS for the exact date.
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Last year my daughter had insurance with Obamacare, we helped he by paying additional so she could have A silver plan. Any bronze plan she could have had paid did not have any doctors within 100miles that she could go to. This year she applied and has now dropped below their poverty level. Federal assistance in Obamacare will help only those 100% to 400% of poverty level. Below the Federal poverty level they want you on Medicaid. Medicaid in Florida denied her because she makes too much money working. She could be better off financially and have Medicaid if she quit her job, but wants to improve her situation, not be on relief, and do more with her life!
One benefit they did give her is an exemption number for her tax filing for 2015, they will not fine her if she has no insurance for the year. Moral here is don’t be too poor or you will get no help at all!
Another kicker for her is that her work will allow her only 28 hours max a week due to their avoiding providing health care as required for full time employees with the Obamacare law!
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You have pinpointed two of the significant flaws in the law. The coverage gap and the incentive to lower hours. No doctors within a 100 miles doesn’t seem right though. I can’t see how the state insurance laws would allow that.
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All of the doctors in the Florida Bronze plans are in the west coast area of the state, none on the east coast area where my daughter lives.
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HOW IN THE WORLD CAN YOU SHOW NO RESPECT FOR SENIORS IF YOU DO NOT GIVE US A 3% RAISE
WE ARE NOT MAKING IT WITH THE CURRENT STATUS Ralph
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Respect? What are you talking about? Working people aren’t getting raises in that range. Why do we seniors deserve more and more? Where will the money come from to pay higher COLAs from higher taxes on those trying to raise a family? Seniors had a lifetime to prepare for old age.
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FLORIDA CONGRESSMEN 2.9 BILL???? Food for Thought! The USA IS GETTING ABOUT $400 MILLION FROM THE BILLION DOLLAR LOTTERY? OK , I did some MATH from statistic from ssa gov web pages. $882,264,000 annual pay out to 65,098 SSA people. TIMES 2.9 percent equals $25,585,656??? is something wrong?? NO COLA 3 TIMES SINCE 2008 of 4 IN THE LAST 40 YRS. But Federal gets a COLA. JUST SAYING!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
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CORRECTION BENEFICIARIES ARE IN THOUSANDS– so that is about 65 million people. Sorry
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Not sure I understand all you are saying, but how do you equate a one-time payment in taxes with an ongoing COLA paid by the SS trust that continues year after year? What happens in year two?
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Obviously this writer voted for Obama and subscribes to the, less work more benefits from the government theory. The fact that she even posted that letter indicates how she perceives her worth and lack of abilities. What a wast of an education which I am sure she worked very hard for.
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I do not have a comment on the above. I wanted to get your thoughts on why everyone is only concentrating their concerns on the amount owed by the student in student loans and not on what I think is also very important…How much the parents take out and will have to pay back into their retirement years. I saved for my children’s college tuition but no where near what it takes now to put them through college. Every year that I get the bill, the amount we receive in aid is less and the cost of the tuition goes up by $5000.00. I figured if things keep going the way they have already, my wife and I will be indebt in the amount of $120,000.00 for my two kids to get a four year degree. Talk about a bubble waiting to happen!
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Very good point. I share your experience having put four children through college over ten consecutive years using home equity and then remortgaging and only paying off the loans last year, over ten years after the youngest child graduated ( and when I was age 70).
But nobody cares about people like us because we are the great minority. Most people either can’t afford to do this or do not feel it’s their responsibility.
However, it is important to save for retirement first.
Dick
Richard D Quinn
Blog http://www.quinnscommentary.com Twitter @quinnscomments
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Yeah, parent who save get shafted. Still, the problem it too many folks who are willing to spend anything to send little Jonnie to whatever school they want, thus perpetuating the system. Prices go up with the availability of more money. There are many low to no debt options:
Community college for the first two years.
Do well and earn scholarships to offset tuition.
Work (there’s a novel idea!)
Schools that take a small percentage of one’s pay after graduation in exchange for tuition.
Join military then go to school on military benefits.
In-state vs. out of state schools.
Lower tier schools will often offer excellent financial packages to draw in excellent students.
No reason to go into debt
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Can you explain to me, then, how my grandma, who receives about $600/month in SS is now having about $400 taken out for insurance under Obamacare? She will have about $200 to live on for the entire month. This is not a “what’s gonna happen” rumor, but an “it is now a reality”.
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Not sure we have all the facts here. If your grandma is on Medicare, she can’t be on Obamacare and wouldn’t be paying more than the standard Medicare premium. Based on the income you state she may even be dual eligible with Medicaid depending on where she lives. Is she paying for some expensive supplemental coverage? I can see no way out of an income of $600 she is paying $400 for health insurance and certainly not the result of the Affordable Care Act. There appears to be more to this story.
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This is in regard to Took Time. I am one lucky guy. In our family if you wanted to have some money in your pocket, you worked for it. I do not remember getting any allowance. But I do remember, Grandma giving us a dime or quarter if we did some work like filling the bin to the furnace with Coal, or painting the fence about 90 feet long, all at age 8 or so. At 10, I could get a paper route and I had to collect 10¢ from each customer each week, and that took a lot of energy.
Learned a lot and at 16 worked at a Food Store chain, all through High School and College, married at 21, finished Engineering School at 22 and worked for Teletype a Subsidiary of AT&T. I actually started saving at 10 with a bank account, and loved getting interest on my money. Dad and Mom taught me well how to save, then the stock market, then IRA’s, and oh, since 16 years old Dad taught us how to do our own taxes, I still have a copy of the 1968 return, the rest are no PDF’s. Dad was an accounting clerk, with a High School education, and 44 years with a pension from a Gas utility company. I wanted to be like Dad, but that changed of course. I virtually have NO pension, but learned a few things along the way, compounding is how you grow your nest egg, and being stubborn during downturn of stocks. Luckily I learned indexing, and saved using our IRA’s, always taking all the free money given by our company, and always trying to save more than the minimum. It all worked out and I am semi retired since 60 and now 77 years old. I currently use the Buffett strategy, S&P500 for 90% of your money, and 10% in Treasuries, he said this is how his wife will save after his death. I modified it to 85% equities, and 15% Cash, my wife likes cash is king for those lean times, a compromise. Never sold stocks when they go down, they always come back. I lived through some rough periods, but only 11 down years through our 55 years of marriage. Last year 2022 was a 25% loss, years 2001, 2002, and 2003 accounted for a combined 48% loss, that was my depression years, but sold NOTHING during that time, one of the secrets of success. My personal average over the 55 years is 9.8%. There are no quick rich schemes, you have to save over time. Inflation is the killer of retirees, that is why no Annuities, and why I am so fully invested in 4 major indexes, with the goal of most will be the S&P 500 by the time I am 80, currently only 16 stocks, had 41 in 2021. Maxed SS, took the wife’s at 65, mine at near 70, as only have a $1000 pension, the rest comes from my SS and RMD each year, and we live comfortably after 50 years of hard work. We are the lucky ones, worked hard, raised 3 children and none of them had any student loans, due to partial scholarships and all of them working hard and helping pay their colleges, one private and the other two at State schools.
That is our journey, life throws curveballs at you, and that rainy day fund has to get you through the lean times. I took that $1000 pension since I was 55, that is 22 years, and have not spent one dime of it until not putting into stocks at 65, so used it as income, but that account never touched is now over $900,000 nice little nest egg. Save what you can, pay credit cards monthly, do not spend more than you have and only take loans for your home and car. You will then have a wonderful carefree retirement. Oh, I have worked from home after being let go in 1994, and used the Internet and a fax machine to start a resale business for inkjet printing inks and parts. Been involved in inkjet printing before any one knew what the word was in 1969. If you want to be paid what you are worth, you have to have your own business so you can control as much as you can. Tripled my salary as an electronic engineer during that time, never would have happened, so I thank my company for putting me out on the street to better myself and family. Of my 16 stocks 7 of them of the Magnificent 7 and although very late to Apple, I have a 780% gain there.
Thanks for you great real life articles, you are helping many prepare and do better in their retirement. God Bless you and your family. Bill
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