Retirement questions

judypilot said:
(For the record, I think Medicare and Social Security should be means tested, which means I'd get a lot less, but for the time being, they are not, so I'm doing well on that front.)
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What would be the justification for that ? The people who made more in their lifetime already paid a larger amount into the system, why do you want to soak them in retirement ?

A few years ago, my wife saw a billionaire as a patient at the University hospital. I did her billing at the time and expected some type of private pay arrangement. No, medicare part-B and a plan F from AARP. This was someone who actually built her business and you don't get to that place by being wasteful.
 
weilke said:
What would be the justification for that ?...
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Not fair for sure but something needs to be done to make up for overall gov't financial malfeasance.

Tangentially related, my daughter is thinking of paying off her student loans early. I recommended she wait a year to see if the Dems get anywhere with their student debt forgiveness drive. With her luck, she would payoff the balance the day before a gov't announced forgiveness program.
 
MICHAEL MAHN said:
Tangentially related, my daughter is thinking of paying off her student loans early. I recommended she wait a year to see if the Dems get anywhere with their student debt forgiveness drive. With her luck, she would payoff the balance the day before a gov't announced forgiveness program.
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I anticipate that some kind of bribe to the young and indebted will happen right before the election.
Crazy concept that the people who chose to go in debt for a degree in underwater basketweaving are going to get a massive payday while the guy who went to the pipefitters union for an apprenticeship gets a massive 'eff you'.

I am all for targeted loan forgiveness to those who work in jobs that we want filled with qualified people like teachers and healthcare. But that needs to be tied to working, not a blanket bailout.
 
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judypilot said:
I think I'm living on about the same amount I did before I retired
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Agree. When I calculated/tracked expenses prior to retirement I split my expenses into different categories. When I retired I was able to separate my work expenses, investment expenses, vehicle expenses, etc from my true “living” expenses. At present my “living” expenses are basically the same from pre/post-retire just as yours. However, that will change once I hit 65 and go medicare as then I will pay off my mortgage over a 2 or 3 year period which will dramatically drop those “living” expenses. At least that is the plan at the moment.
judypilot said:
I think Medicare and Social Security should be means tested,
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FWIW: I don’t agree with this either as I paid into those systems. Both are not outright subsidies like welfare and Medicaid where there was no prior payment by the users.
 
FastEddieB said:
Is that pre-Medicare age? Medicare with a supplement is far cheaper that straight health insurance.
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Not if your stuck with IRMAA. Work all your life to provide for a decent retirement. In my case I worked more than one job. My normal job, and I invested in rental property. So try to get out of some of the work, and sell the property.(tremendous amount of work in that endeavor) Capital gains, IRMAA etc kills you. I would not have done the work if I had known the consequences. That's pretty sad, when you think about it. Don't be productive, don't take care of yourself and your future, don''t be responsible for your future, or you will get royally SCREWED!!!! Pretty sad incentive to try and improve your lot in life!
 
judypilot said:
(For the record, I think Medicare and Social Security should be means tested, which means I'd get a lot less, but for the time being, they are not, so I'm doing well on that front.)
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Really? Over my career, I've paid in (and the company has matched) quite a bit of money. I'd like to get that back with interest, or some reasonable facsimile thereof.
 
SS and Medicare means testing is just another way to screw people who were responsible enough to look out for their own future. SS one of the biggest rip offs ever! What would you get every month if you put you SS tax in a coffee can and buried in the back yard. Base your estimate on the SS actuarial tables. If the gubermint takes your money and invests it in your future for you, shouldn't they provide you some kind of positive return on your investment? But you lose every month on that "investment" The big screw job! Means testing will only make it worse.
 
Oldmanb777 said:
Not if your stuck with IRMAA.
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We’ve managed a very comfortable retirement. But IRMAA (I was aware of the concept but had to look up the abbreviation) doesn’t presently kick in until $182,000 in income for joint filers, and we’re a long way from that amount.
 
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Oldmanb777 said:
SS and Medicare means testing is just another way to screw people who were responsible enough to look out for their own future. SS one of the biggest rip offs ever! What would you get every month if you put you SS tax in a coffee can and buried in the back yard. Base your estimate on the SS actuarial tables. If the gubermint takes your money and invests it in your future for you, shouldn't they provide you some kind of positive return on your investment? But you lose every month on that "investment" The big screw job! Means testing will only make it worse.
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Oldmanb777 said:
Not if your stuck with IRMAA. Work all your life to provide for a decent retirement. In my case I worked more than one job. My normal job, and I invested in rental property. So try to get out of some of the work, and sell the property.(tremendous amount of work in that endeavor) Capital gains, IRMAA etc kills you. I would not have done the work if I had known the consequences. That's pretty sad, when you think about it. Don't be productive, don't take care of yourself and your future, don''t be responsible for your future, or you will get royally SCREWED!!!! Pretty sad incentive to try and improve your lot in life!
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But wasn't that a one time thing since you sold the property(ies)? It wouldn't apply in subsequent years.

I also have a capital gains problem, but it's more about reinvested capital gains distributions from mutual funds. Seems like I should sell these investments for more tax-efficient ones, but that would create an even greater capital gains problem. I shouldn't complain, though. Better than capital losses.
 
The most recent pearl of wisdom I heard was to have enough cash equivalents to live on the first three years of your retirement, in order to weather a downturn in investments.
 
catmandu said:
The most recent pearl of wisdom I heard was to have enough cash equivalents to live on the first three years of your retirement, in order to weather a downturn in investments.
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So what do you do when the downturn happens three years in, after your cash reserves are depleted?

Better advice would be to maintain a 3-year cash reserve to be used when your investments tank. Spending the cash in the first three years regardless of investment performance seems silly.
 
Everskyward said:
But wasn't that a one time thing since you sold the property(ies)? It wouldn't apply in subsequent years.

It would seem so. But they "Generally" use 2 years in arears to figure IRMAA, but they have the ability to apply other years of AGI, at their discretion. So in our case, they have decided to go back a couple more years and apply that to other years as well. Thier statement says that "Other years MAGI isn't significantly different, so they are applying that IRMAA to other years" $165K+ isn't significantly different?????????
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The reason I think SS and Medicare should be means tested is people are living a LOT longer than they used to. The system as set up now is unsustainable, especially Medicare. Don't kid yourself. You didn't pay into the systems to support yourself in your old age. You paid in to support your parents! I suspect most of us are either Baby Boomers or whatever the BB kids' generation is. Baby Boomers supported our parents. Fortunately, there were a LOT of us, so the cost was spread around. I dislike that kind of generational cost-shifting, but it's already happened. Succeeding generations have been quite a bit smaller, meaning either us older folks who have done well are going to have to kick in by giving up some of our benefits or we're going to have to tax the heck out of the people who are still working. Or, more likely, both. Do you really want your kids' and grandkids' taxes to be a lot higher to support you in your old age?

Having said that, if I'd been able to take all the money I paid into SS and Medicare while working and invested it, I'd have approximately 3-4 times as much money as I have now and wouldn't need Medicare (I already don't "need" my SS payments to live on, but I'm sure not going to stop taking them, either).

By the way, one line I've been hearing from some politicians is that SS was intended as insurance, not as a retirement fund. That is a lie. My father was old enough to remember when SS was established and he said that it was definitely established as a federal retirement fund, NOT insurance.

So I don't buy the line "I paid in so I should get money out". Yeah, the government has screwed up, but that doesn't fix the situation. I'd rather have my benefits cut than taken away entirely, especially Medicare.

As far as loan forgiveness is concerned, I could not agree more. We know a young couple who worked their BUTTS off to pay off their student loans. To say they're ****ed that they could have dallied and have it all forgiven would be the understatement of the year. Forgive for teachers and nurses, maybe, but everyone else? No way!
 
Half Fast said:
So what do you do when the downturn happens three years in, after your cash reserves are depleted?

Better advice would be to maintain a 3-year cash reserve to be used when your investments tank. Spending the cash in the first three years regardless of investment performance seems silly.
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Yes, basically that, I just did not word it correctly. The particular example I saw just showed that those who had to rely on investment draws and were unfortunate enough to enter retirement during a equity downturn never recovered, vs. those that had cash equivalents to use and could wait for equities to recover. Certainly more complex than that, but you get the point (I hope).
 
What medicare needs to do is to reduce the amount it spends in the last months of life. If you work in a hospital you see mindboggling behavior patterns where we blow 50-100k/month on futile care for people who are beyond the point where they can personally object to what is being done to them.
If we fix that and we are still out of money, we just need to raise the medicare tax until it covers the expenses , not take away the eligibility from those who already bankrolled the thing during their working life.

The only upside I can see with covid is that it improves the age distribution between the working and the beneficiaries. Economically, we will see whether the long term cost from lung and kidney damage in younger patients will be higher than the reduced size of the Medicare population.
 
MICHAEL MAHN said:
Not fair for sure but something needs to be done to make up for overall gov't financial malfeasance.

Tangentially related, my daughter is thinking of paying off her student loans early. I recommended she wait a year to see if the Dems get anywhere with their student debt forgiveness drive. With her luck, she would payoff the balance the day before a gov't announced forgiveness program.
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My daughter joined the Navy. No debt to forgive.
 
judypilot said:
The reason I think SS and Medicare should be means tested is people are living a LOT longer than they used to. The system as set up now is unsustainable, especially Medicare. Don't kid yourself. ...
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Indeed, don't kind yourself. the system was unsustainable from day one.
 
judypilot said:
You didn't pay into the systems to support yourself in your old age.
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True. And SS was never an active component of my retire plan for that reason. Regardless I totally believe no elected official will allow SS or medicare to fail if they want to be re-elected for the next 20 years. I'm a tailend boomer and think once the boomers are a minority then things will start to change. But only then.
judypilot said:
Do you really want your kids' and grandkids' taxes to be a lot higher to support you in your old age?
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Yes. Maybe then they will be motivated to fix the problem our generation couldn't or won't.;)
 
weilke said:
What medicare needs to do is to reduce the amount it spends in the last months of life. If you work in a hospital you see mindboggling behavior patterns where we blow 50-100k/month on futile care for people who are beyond the point where they can personally object to what is being done to them.
...
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How much is spent on people that are in Hospice or Pallative care?
 
MooneyDriver78 said:
Difference is the one is made by the person and the other is made by the parent(s).
I see no reason why someone else should control another’s life.
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I guess many have their beliefs and I have mine. I've always been taught that life is a very precious gift given to us of God and that it should be loved, cherished, protected and preserved at all possible cost. To do anything less trends towards evil.

But I'll leave this alone as we are getting into thread lock territory ... and that's not my intent.
 
Daleandee said:
I love life and believe it should be protected!
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And so do I. Except I do not define life as suffering through my final years. It should be my choice not yours unless you believe I should suffer? As to using that means as birth control, no. And FWIW, I've made arrangements in Switzerland just in case...;)
 
Bell206 said:
And so do I. Except I do not define life as suffering through my final years. It should be my choice not yours unless you believe I should suffer? As to using that means as birth control, no. And FWIW, I've made arrangements in Switzerland just in case...;)
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As I said ... I'm leaving this alone.
 
Bob Noel said:
How much is spent on people that are in Hospice or Pallative care?
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Too few people are in hospice or palliative care. If we had a reliable way to determine when 'the last 6 months' begin and had a way to move people to hospice or palliative, we would be spending quite a bit less.
 
weilke said:
Too few people are in hospice or palliative care. If we had a reliable way to determine when 'the last 6 months' begin and had a way to move people to hospice or palliative, we would be spending quite a bit less.
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We do, obviously maybe not in all cases, but for degenerative diseases we do. Hospice can be inexpensive IF they can keep you in your home.
Hospitals and nursing homes are expensive, but not hospice itself.
 
weilke said:
If we had a reliable way to determine when 'the last 6 months' begin
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We do, ask them. But a serious question, who determined "6 months" was the magic number? Why not 12 months for hospice and 2 years for palliative? I've yet to get a definitive answer.
 
Oldmanb777 said:
It would seem so. But they "Generally" use 2 years in arears to figure IRMAA, but they have the ability to apply other years of AGI, at their discretion. So in our case, they have decided to go back a couple more years and apply that to other years as well. Thier statement says that "Other years MAGI isn't significantly different, so they are applying that IRMAA to other years" $165K+ isn't significantly different?????????
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That's just bizarre. Everything they publish (that I've seen anyway) says they use your MAGI from 2 years back (as in 2020 MAGI for 2022 IRMAA) unless that year isn't available. And they also say that single-year events, like your capital gain, will only affect IRMAA for a single year -- that's the rationale for not letting you appeal on that basis. You have the ability to appeal (actually 5 levels of appeals). I can't imagine you wouldn't have a good chance of success.
 
Bell206 said:
^^^^ This. FWIW: A common point among the majority of post-retire people I've talked to agree they should have retired earlier vs later as most of their fears were unfounded after retirement.
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I retired at 69. Also found things to be better after retirement than I expected. In my case I probably would not have retired earlier anyway, though.
 
weilke said:
What would be the justification for that ? The people who made more in their lifetime already paid a larger amount into the system, why do you want to soak them in retirement ?

A few years ago, my wife saw a billionaire as a patient at the University hospital. I did her billing at the time and expected some type of private pay arrangement. No, medicare part-B and a plan F from AARP. This was someone who actually built her business and you don't get to that place by being wasteful.
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Some of the most wasteful people I know started their own businesses. Some short sold houses in 2009 and stuck the bank with over a million.
 
MICHAEL MAHN said:
Not fair for sure but something needs to be done to make up for overall gov't financial malfeasance.

Tangentially related, my daughter is thinking of paying off her student loans early. I recommended she wait a year to see if the Dems get anywhere with their student debt forgiveness drive. With her luck, she would payoff the balance the day before a gov't announced forgiveness program.
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Student loans are a pretty safe debt, bad economy, lost your job, you can suspend your payments. If you go on the IDR payment plan, the loans are forgiven after a certain amount of years. There might be some federal forgiveness too. Whereas all your other debts won’t be forgiven for sure.
 
Oldmanb777 said:
Not if your stuck with IRMAA. Work all your life to provide for a decent retirement. In my case I worked more than one job. My normal job, and I invested in rental property. So try to get out of some of the work, and sell the property.(tremendous amount of work in that endeavor) Capital gains, IRMAA etc kills you. I would not have done the work if I had known the consequences. That's pretty sad, when you think about it. Don't be productive, don't take care of yourself and your future, don''t be responsible for your future, or you will get royally SCREWED!!!! Pretty sad incentive to try and improve your lot in life!
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No one is forcing you to take Part B and D Medicare. Go on the exchange and pony up $2000 each a month and maybe you will walk away with a different point of view.
 
Bob Noel said:
Indeed, don't kind yourself. the system was unsustainable from day one.
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Day one, literally:

Ida May Fuller paid in $24.75 into it, then retired and became the first person to get a SS check - for $22.54. She lived another 35 years and collected a total of $22,888.92.

https://www.ssa.gov/history/idapayroll.html

She probably thought it was a good deal.
 
Maybe the system was upside down from day one, but if it only was to pay out supplemental income, instead of all the other things it pays for but isn't related to retirement, we wouldn't be in this fix. And no, I don't have the list, but I've seen it, and it's extensive.

I've never really planned on getting SSI and will be fine without it. Howsomever, it is money I paid in (with a miniscule return) and I was never given a choice about whether or not I was going to participate in that program.

I could have a lot better income stream from just my "contributions" to SSI if I'd been allowed to invest them conservatively than I'll ever get from SSI.

I wouldn't be surprised if a case could be made against the Federal Government that they didn't meet their fiduciary responsibilities in the way they managed the SS trust "fund".
 
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