Time To Raise Retirement Age

[arnguy]

OMG! Nothing like a Sunday sermon on an insurance forum.

 

[Robert Barney]

I was responding to:

Robert, you know our society is one of "Instant Gratification".

Yes I do know and I know why.

 

[Norwayguy]

Getting back to the title of this thread...Why only raise the retirement age...especially how the government does it, it affects younger people...Why not also lower the retirement benefit....The older Generation has run this country and led us down this path but they need to raise the retirement age of younger people without touching the retirement benefit....there is another choice as well which would be to raise the FICA tax.

Now politicians like easy soundbites so only touching 1 part of the triangle is easier for them.

 

[Robert Barney]

Getting back to the title of this thread...Why only raise the retirement age...especially how the government does it, it affects younger people...Why not also lower the retirement benefit....The older Generation has run this country and led us down this path but they need to raise the retirement age of younger people without touching the retirement benefit....there is another choice as well which would be to raise the FICA tax.

Now politicians like easy soundbites so only touching 1 part of the triangle is easier for them.

I think the benefit should be means tested. If you have $70,000 or more of other retirement income, you don't get Social Security. If you have $30,000 or less, you get full Social Security. I would diminish the benefit for income in-between. $50,000 and you only get half.

I would raise retirement age immediately. I believe it is now 66. If you are 64, I would raise it to 67. If you are 63, I would raise it to 68. 62 means retiring at 69 and if you are 61 you must work until 70. No early retirement option.

I would allow a retirement benefit for people at 65 if they have a proven disability or inability to do the job for which they are trained.

Medicare should also be means tested. If you have a certain level of income, you should be responsible for a significant copay.

 

[GreenSky]

How about if your spouse is (in his words) "successful?" You are on disabililty and receiving Medicare benefits. You are also receiving permanent disability benefits from the state.

If you're a conservative, you accept but feel guilty. If you're a democrat you simply believe you are entitled and want to share taxpayer money with everyone.

Rick

 

[retread]

I think the benefit should be means tested. If you have $70,000 or more of other retirement income, you don't get Social Security. If you have $30,000 or less, you get full Social Security. I would diminish the benefit for income in-between. $50,000 and you only get half.

I would raise retirement age immediately. I believe it is now 66. If you are 64, I would raise it to 67. If you are 63, I would raise it to 68. 62 means retiring at 69 and if you are 61 you must work until 70. No early retirement option.

I would allow a retirement benefit for people at 65 if they have a proven disability or inability to do the job for which they are trained.

Medicare should also be means tested. If you have a certain level of income, you should be responsible for a significant copay.

A lot of talk in this thread about raising retirement age up to 70, but no one, especially you, Robert, have made one comment about the RMD.

I am pushing 70 and working my tail off.... trying desparately to rebuild my retirement savings decimated by Wall Street crooks, thieves, bandits, and just plain greedy scumbags.

But guess what happens in just a few years? I HAVE to start spending down that meager savings I am now trying to fund.

I think the government should raise the RMD to 80 or even do away with it all together. In just a few short years, a hole is going to be put in my savings bucket, so that I will lose a lot of what I will need to keep me off the welfare rolls in my later years when I can no longer work. Talk about elder abuse!... Go ahead... Handicap me when I am defenseless.

My point is that you must think beyond just a simple solution. I don't see raising retirement age as much a threat as the RMD.

 

[VolAgent]

A lot of talk in this thread about raising retirement age up to 70, but no one, especially you, Robert, have made one comment about the RMD.

I am pushing 70 and working my tail off.... trying desparately to rebuild my retirement savings decimated by Wall Street crooks, thieves, bandits, and just plain greedy scumbags.

But guess what happens in just a few years? I HAVE to start spending down that meager savings I am now trying to fund.

I think the government should raise the RMD to 80 or even do away with it all together. In just a few short years, a hole is going to be put in my savings bucket, so that I will lose a lot of what I will need to keep me off the welfare rolls in my later years when I can no longer work. Talk about elder abuse!... Go ahead... Handicap me when I am defenseless.

My point is that you must think beyond just a simple solution. I don't see raising retirement age as much a threat as the RMD.

I understand how you feel, but you forget who RMDs serve. They exist to benefit the government. You deferred a portion of your paycheck, and then let it grow tax-deferred, hopefully accumulating a sum of money. Now the government wants its cut, and RMDs are its way of forcing you to remove it from the tax shelter.

 

[retread]

I understand how you feel, but you forget who RMDs serve. They exist to benefit the government. You deferred a portion of your paycheck, and then let it grow tax-deferred, hopefully accumulating a sum of money. Now the government wants its cut, and RMDs are its way of forcing you to remove it from the tax shelter.

I certainly understand that. The issue, however, is that because of RMDs, at least in my situation, puts a hole in my attempt to accumulate savings to avoid drawing against an unfunded liability.... i.e. Medicaid... if and when I get to that point in my life (should I live that long) and have no other alternative but to seek public welfare. RMDs work against my effort to avoid this situation.

You, and many like you, just don't seem to get beyond the general provision. I am calling for flexibility and sensitivity to things that go beyond the general. One size does not fit all.

In the situation I am referring to, the RMD is not for funds that I accumulated over my lifetime of savings... that is gone. Evaporated with the economic meltdown. Non-existant. I am now trying to REBUILD at a late age. With only a few years left to put away savings, I am confronted quite soon with the "age 70" rule, etched in stone. If you are able, try to put yourself in my shoes.

 

[Norwayguy]

I certainly understand that. The issue, however, is that because of RMDs, at least in my situation, puts a hole in my attempt to accumulate savings to avoid drawing against an unfunded liability.... i.e. Medicaid... if and when I get to that point in my life (should I live that long) and have no other alternative but to seek public welfare. RMDs work against my effort to avoid this situation.

You, and many like you, just don't seem to get beyond the general provision. I am calling for flexibility and sensitivity to things that go beyond the general. One size does not fit all.

In the situation I am referring to, the RMD is not for funds that I accumulated over my lifetime of savings... that is gone. Evaporated with the economic meltdown. Non-existant. I am now trying to REBUILD at a late age. With only a few years left to put away savings, I am confronted quite soon with the "age 70" rule, etched in stone. If you are able, try to put yourself in my shoes.

Not to be insensitive but RMDs only require you to pull money out of a qualified plan and pay the tax on it...You are free to reinvest it as you desire in a taxible account or can defer it again in an Annuity...At this point trying to build back up a qualified plan is going to be difficult and you can fund a plan that does not require RMD...such as non-qualified annuities, non-qual Investments or Roth if eligible.

There exists flexibility.

 

[VolAgent]

I certainly understand that. The issue, however, is that because of RMDs, at least in my situation, puts a hole in my attempt to accumulate savings to avoid drawing against an unfunded liability.... i.e. Medicaid... if and when I get to that point in my life (should I live that long) and have no other alternative but to seek public welfare. RMDs work against my effort to avoid this situation.

You, and many like you, just don't seem to get beyond the general provision. I am calling for flexibility and sensitivity to things that go beyond the general. One size does not fit all.

In the situation I am referring to, the RMD is not for funds that I accumulated over my lifetime of savings... that is gone. Evaporated with the economic meltdown. Non-existant. I am now trying to REBUILD at a late age. With only a few years left to put away savings, I am confronted quite soon with the "age 70" rule, etched in stone. If you are able, try to put yourself in my shoes.

I understand your anger at the situation, but I'm not the source of the problem. I didn't say I was for or against the 70 1/2 rule. I merely stated why it exists, and why it is unlikely to change any time soon. Congress needs revenue, and they need more of it, not less. Right or wrong, I don't see them relaxing the RMD rule anytime soon.

Remember, the 59 1/2 and 70 1/2 rules exist to serve Congress' purposes, not the investment community or investor.

As my CPA says, "Dying with money in a qualified account is generally an ugly situation."