Community Forums

FrankenRV · 01-26-2020, 06:40 PM

Regarding the Medicare IRMAA (Income Related Monthly Adjustment Amount):

First increase is when MAGI reaches approx $87K for singles and $174K for married joint. Premium increases from about $140 to about $190/month.

Next increase is when MAGI reaches approx $109K for singles and $218K for married joint. Premium increases from about $190/month to about $270/month.

Next increase is when MAGI reaches approx $136K for singles and $272K for married joint.
Premium increases from about $270/month to about $352.

Next increase is when MAGI reaches approx $163K for singles and $326K for married joint.
Premium increases from about $352/month to about $433.

Last increase is when MAGI reaches $500K for singles or $750K for married joint.
Premium increases to about $461. But really, if my MAGI is greater than $500K, $461 per month is fly excrement.

jacwjames · 01-26-2020, 06:47 PM

Quote:

Originally Posted by edegenhart

You are missing a few things to help you get information. What is your tax filing status Married filing jointly? Single? FYI, on the Social Security web site SSA.GOV, it will inform you about how you will be taxed based on your income. It will also tell you what your medicare will cost at 65 based on your income and filing status.

I went to the website and was able to find a flyer that explained the process and cost for higher earning beneficiaries.

I had approximately that amount in my current model. I also use a 15% inflation factor for any health insurance.

deserteagle5 · 01-26-2020, 06:56 PM

Whatever you do, don't underestimate how much you should have withheld once you retire.

I used one of those handy dandy calculators when I was preparing for retirement a couple years ago and followed the recommendations. Guess what? After having a small refund coming back after filing my taxes every year while I was working, at the end of my first year of my retirement I nearly passed out when my accountant told me I owed the feds $6000 more!

GuyG · 01-26-2020, 06:57 PM

Quote:

Originally Posted by Finance

For people with other assets like the OP, absolutely.

Investments will generally outperform the 8% SS increase. Spend the SS, preserve your capital.

Preserving the assets that you control means they can be included in your estate planning. You can’t leave your SS benefit to your heirs.

Sounds like really good advice.

jacwjames · 01-26-2020, 07:12 PM

With the passing of the Secure Act leaving anything to your heirs is getting harder and harder (except if it is left to your spouse). They will still get the money if it is an IRA but your heirs will have to withdraw with 10 years, which means either way Uncle Sam will be getting the taxes sooner then later either way, possibly in a higher tax bracket since it is combined with the heirs earned income!!!

I wonder if this will change the concept of the 4% rule on withdrawals.

Looking at my circumstances it might make sense to withdraw quicker, trying to stay in the lower tax brackets and then reinvesting in a ROTH which you can still pass it on. At least a ROTH can grow and earnings are not taxed.

RVPioneer · 01-26-2020, 07:29 PM

Quote:

Originally Posted by rv1993

If you retire before your full retirement age, then say at 62, then that is the rate you get from then on, it does not increase when you get to your full retirement age. Also if you retire before your full retirement age, then for 2019, max allowable income is $17,640 per year. your benefits are reduced by $1 for every $2 you earn over the limit. So $90,000 - $17,640 = $72,630, your benefit reduction would be $36,180 or $3,015 per month. So you would not receive any benefits. After you wait until your full retirement age then there is no reduction, I waited until 66, because still working part time did not want to loose all of that money. It is almost impossible but if you can get an appointment at Soc.Sec. and talk to someone there. I did and best decision I ever made, had to sit in office for 3 hours to talk to someone, but it was worth it. Semi retired still have 6 figure income and work all I want and still get full benefits with a maximum of 25% taken out for income tax....BUT no penalty...2 friends took it early and now wished they had not, but no one can be faulted as this is an individual decision. Was going to wait until 70 to get max, but calculated it would take me 11.75 years after 70 (almost 82) to get back that money and with some health problems decided to go ahead and do it at 66.....Normally do not leave this long a comment but I know so many people who did not understand the full ramifications of their actions, and the internet is full of bad and inaccurate info.

Still working and happy as all get out god bless to all,,,,fulltimer rver

As you boldly stated, SS benefits will be reduced once earned income exceeds a specific level. It is possible to have $90K of annual income while at the same time having no earned income. In this case there would be no benefit reduction.

FrankenRV · 01-26-2020, 07:35 PM

I doubt it will change the 4% rule. That concept related to determining a target withdrawal rate such that you would not run out of money before you die.

THenne1713 · 01-26-2020, 08:08 PM

Suspicion is that "taxable income" maybe pleasant surprise for you? (Unless Warren or Sanders get elected?)

Ruddoj · 01-26-2020, 08:15 PM

Quote:

Originally Posted by Finance

For people with other assets like the OP, absolutely.

Investments will generally outperform the 8% SS increase. Spend the SS, preserve your capital.

Preserving the assets that you control means they can be included in your estate planning. You can’t leave your SS benefit to your heirs.

bingo!!

spend and use the SS as early as possible and leave your 'goose laying the golden eggs' alone as long as possible (your 401k/savings/stocks/TSP).

SS will help bridge the gap from employment into full retirement where budgets matter more.....might as well 'start' retirement with another branch of income that is available.

mlpeloquin · 01-26-2020, 08:17 PM

Quote:

Originally Posted by jacwjames

With the passing of the Secure Act leaving anything to your heirs is getting harder and harder (except if it is left to your spouse).

401K's were established for the owner's retirement not the owner's children or anyone else with the exception of the spouce. So be happy and spend it. They are still getting what is left.

spleeft · 01-26-2020, 08:23 PM

Nevermind all this tax talk, lets hear about that awsum RV garage build !!!!!!!!
Seriously though, Im getting ready to retire from my shiftwork job and Ill be 56 and dont know what ill do as far as savings/ investments / pension / SS so thanks for all the great posts and info here !!!

RamblingRoze · 01-26-2020, 08:27 PM

Another consideration to determine whether to wait on taking SS until 70 is based on how much other income you have and how much you have saved. Waiting until 70 gives you higher "guaranteed" income for the rest of your life. Depending on how you are invested, if the market goes bad or you run out of savings or encounter a health or family issue that uses your savings faster that you thought, you will have more money to live on if SS becomes your only source (or SS and Pension).

I was looking at the break even and taking SS at 66 and my financial advisor suggested the above as another way to look at it. It is truly a personal decision as someone said and not really a mathematical one.

777 Driver · 01-26-2020, 08:34 PM

Quote:

Originally Posted by mlpeloquin

401K's were established for the owner's retirement not the owner's children or anyone else with the exception of the spouse. So be happy and spend it. They are still getting what is left.

I heard a respected Financial Adviser on the radio who made reference to a survey of millennials regarding their retirement plans. The conundrum they faced was that they weren't saving enough to fund their goal of retiring in their late 50's. Their plan to meet that deficit? Inheritance!

Now, consider that the oldest millennial is 39 and the youngest will turn 24 in 2020. That will make the oldest, by their retirement goal of retiring in their 50's, retirement eligible while their parents, quite possibly, are still alive!

A plausible solution? They're going to kill you to facilitate their retirement.

You've been warned!

Take care,
Stu

RVPioneer · 01-26-2020, 09:05 PM

Quote:

Originally Posted by spleeft

Nevermind all this tax talk, lets hear about that awsum RV garage build !!!!!!!!
Seriously though, Im getting ready to retire from my shiftwork job and Ill be 56 and dont know what ill do as far as savings/ investments / pension / SS so thanks for all the great posts and info here !!!

Did someone say RV Garage?