Setting Every Community Up for Retirement Enhancement (SECURE) Act

[ckelly78z]

I must be one of the "Haves" on this site. I will have a 28 year pension at 62 years old. I will also have ^^$500K in my 401K, and both my wife, and I will be able to take SS early, and enjoy ourselves immensely. It has taken ALOT of discipline, and work to get to this point, but some still say I am lucky.

They had the same opportunities I had, but chose the new cars, and designer clothes, along with that daily Starbux latte, while I drank water with my packed lunch, drive 15 year old, used cars, and wear jeans/tshirts. We also didn't hit all the nightclubs, or take fancy resort vacations....we camped.

None of these people calling me lucky survived cancer twice, and conjestive heart failure (CHF from chemo drug adriamicin) 3 different times finally culminating in a new pace maker 2 years ago....So, CONSTANT medical expenses was also part of my equation with quarterly visits to 3 specialists.

 

[bullfrog]

I think most people here have realized that housing and maintaining the "American Dream" costs most Americans all of their income including what they should save for retirement. Many do not make enough to make it to social security age without losing their homes and going bankrupt. Many people come here looking for a way to survive by living simply and making compromises or changing lifestyles living in a way that they can afford. Thank goodness those of us that have been "lucky" and discovered the many tips and tricks to living this lifestyle participate in this forum to help those that haven't and maybe even those that are young enough to plan and prevent becoming a casualty of the "American Dream". I believe I read that 40% of college graduates will end up working in low wage jobs carrying a huge student debt. I hope this forum and HOWA is more successful in educating and helping these individuals find a way to not only survive but live happily better than our society and government has.

 

[Tony's Dream]

This is an interesting topic for those wanting to live off the land. I too was consumed with the idea of what was expected of us....school, family, and putting away for retirement. When I hit 50 I found myself asking soul searching questions about my life and future. Was I so consumed with putting away money that I didn't live my life? Now I am within a couple of years of retirement and wondering if I have put away enough to live my life the way I planned? Why is life so challenging, it should be a lot more simply. The sad thing is...that once I get there the government is going to screw things up and destroy my dreams. I am not fully counting on SS but is part of the plan. I fear it will soon be a means test...and I will only have it if I need it....instead of it being a right. I hope all works out.

 

[Qxxx]

I am not fully counting on SS but is part of the plan. I fear it will soon be a means test...and I will only have it if I need it....instead of it being a right.  I hope all works out.

SS should be means tested, but I doubt that people receiving on the low to middle side of things will be the targets. And then it would likely be on a "gradated, faising out" scale like everything else when it comes to money matters and taxes.

OTOH, the Natl Debt is so huge and growing so fast, ya never know what will happen.

 

[B and C]

I must be ones of the haves too. We always lived well below our means so we could take trips and save for retirement. After marriage, new cars went bye bye and we drove older cars. No closet full of clothes we would hardly ever wear. We ate out at the most once a week. Living below your means does not have to be painful. From what I have observed, most people spend more than they make racking up a lot of debt.

 

[bullfrog]

Most low wage jobs can be hard on you physically but there are some that are not so bad. I retired at 53 years old after beating cancer by giving up maintaining a house and receiving a very reduced government pension with health benefits for me but not my wife so we took minimum wage jobs to pay for her health insurance and traveled. Now at 68 years old we only travel a few months a year and my younger wife has taken a job that has low cost health insurance for most of the year. I now only work 6 months or so a year and may soon quit that if it stops being enjoyable, but so far I have found I like working still. It actually seems to help me stay healthy. I took social security at 62 years old so that we didn't have to work more than 6 months a year. It allowed us to travel and enjoy work more as the pressure to pay the bills went away and we could leave and find new minimum wage jobs whenever we wanted. Learning to live simply at a young age really makes a difference, even learning camping skills but especially basic mechanic skills will enable you to increase your donations to a savings plan. Government employment/military service pays much less than private companies but in my case the benefits along with living simply have made this life possible. Just something for young people to consider but it is not for everyone and I do consider myself very lucky.

 

[Qxxx]

It took a while but I was finally able to track down the graphic I was after. Shows that about 11 million people get less than $1000 a month from SS, which is more or less a basic survival amount these days. My feeling is, SS payments should be adjusted so that everyone gets at least a basic "minimum" safety net, around $12,000 a year, otherwise what's the point. Despite what people say, I think FDR would be rolling over in his grave to see this.

https://g.foolcdn.com/image/?url=ht...ution-of-monthly-benefits.PNG&w=700&op=resize

I also love it how they have a section called "How Social Security Works", and then a picture of 2 codgers sitting on their yacht in the Caribbean. Utterly priceless.

https://www.fool.com/retirement/2018/10/21/heres-the-maximum-social-security-benefit-in-2019.aspx

 

[IGBT]

The problem is SS should not have been or be the sole safety net for low income.

SS should be a retirement benefit for those who worked.  They paid into it separately from income tax.

People who are in poverty should get some other type of assistance not tied to SS, which gives them a living wage.  It could be money from the general tax fund, paid for by income, capital gains, and corporate taxes

Having someone live on $700 a month from SS and then saying SS is broken because of this is silly.   That person should be getting at least $1000 or $1200 a month from some other government program.

 

[Qxxx]

Yes, that's the common sentiment today because everyone thinks SS is a retirement program.

There actually is a separate $1 Trillion a year in direct handouts to the 40 million poor in this country, about 10 million of which are over 62 or so, and which amounts to $25,000 apiece, or $100,000 for a family of four. Comes straight out of our national debt. So why are there so many homeless? Where does all that money go?

 

[user 423]

Yes, that's the common sentiment today because everyone thinks SS is a retirement program.

There actually is a separate $1 Trillion a year in direct handouts to the 40 million poor in this country, about 10 million of which are over 62 or so, and which amounts to $25,000 apiece, or $100,000 for a family of four. Comes straight out of our national debt. So why are there so many homeless? Where does all that money go?

What program pays families $100,000 per year???

 

[bullfrog]

One of the candidates running for president has proposed a $1000 per month in addition to social security per individual and if too young for social security, in lew of some of the benefit programs that are temporary. He states, I believe too much is being spent administering the programs meant to help which are too slow to respond to needs caused by poverty.

 

[Qxxx]

What program pays families $100,000 per year???

That's what I asked. Where is all that money going to?

 

[bullfrog]

It probably got lost along with the 1.5 billion US tax dollars the Ukraine banks lost.

 

[highdesertranger]

this conversation is getting real close to being political. please be careful. highdesertranger

 

[Riverman]

I worked hard for 49-years, paid my taxes and tried to do the right thing.

Now, I'm so thankful for the SS that I get every month. It's not that much, but I had to adjust to what I get and do live on it pretty well.

If I received more like the $25k you mentioned above, I really would be so blessed.

 

[Riverman]

edit double post

 

[WanderingRose]

There actually is a separate $1 Trillion a year in direct handouts to the 40 million poor in this country, about 10 million of which are over 62 or so, and which amounts to $25,000 apiece, or $100,000 for a family of four. Comes straight out of our national debt. So why are there so many homeless? Where does all that money go?

I’ve never heard of such a program and don’t believe one exists, tho I could possibly be wrong.

Entities periodically total up potential benefits, such as from subsidized housing, food stamps, medical cards, etc., and come up with outrageous “cash equivalents”.

Not the same as receiving this in disposable income, and I also suspect a working family receiving benefits of any kind would beg to differ that they are living even comfortably.

 

[Travelmonkey]

RMD going up slightly is the biggest benefit of that law to the consumer that I see. I think the main reason for this law was to close the loophole that allowed passing wealth in retirement accounts across decades; now funds must be drawn down w/in 10 years (so they can me taxed).

Really not sure on other items:

* 529 to pay off college loans? If you had money in a 529, why would you take on debt and accrue interest in the first place?
* Raising the age of making contributions; how many people are working past 70.5 years old and can contribute? Plus under new plan you need to take a RMD at 72 (and get taxed).

 

[SLB_SA]

RMD going up slightly is the biggest benefit of that law to the consumer that I see.

For me, raising the age of required RMDs is the most important issue.  If I had earned income, I guess the option of putting some into an IRA (and so reducing my income taxes that year) might appeal to me???

If you have multiple IRAs or 403(b)s, you're allowed to combine the RMDs from the same type of account and take a single distribution from one of the accounts. You're not permitted, though, to withdraw an RMD for an IRA from a 403(b), or vice-versa. And you can't exercise such consolidation when it comes to 401(k)s.  Mixing Plan Types to Meet RMDs

 

[mpruet]

I agree that for the retired person raising the RMD to 72 is the biggest benefit.  For me that gives me two additional years that I can do partial transfers from my IRA into my Roth.  

But I think for the low end wage earner the biggest benefit is the fact that folks working in small companies can be part of a multi-business 401K is a huge win.  Up until now the only retirement account that those folks could save in was individual IRAs and Roths.

I don’t understand the business of having an annuity inside of a 401K.  A variable annuity is already tax deferred so it seems having one inside a 401K is kinda silly.  The only way that it makes sense is if you could move the annuity outside of the 401K and just use it as a means of controlling your distributions.  But since an annuity is generally not inherited other than your spouse, has a low growth rate, and rather high fees it’s still not something that I’d want to get.