Talk of The Villages Florida - Rentals, Entertainment & More
Talk of The Villages Florida - Rentals, Entertainment & More
Closed Thread |
|
Thread Tools |
#1
|
||
|
||
IRMAA not worth getting excited over unless LARGE IRA
My financial expertise is in building models for future decision making about whatever the topic is, doesn't matter, there are thousands of financial decision topics.
So, since I (Sportsguy) am now retired and my wife (CoachK) is still working but will retire next year, I have built out the retirement model even further to include medical insurance premiums and Roth Conversions to understand when to take Social Security and what is the status of our IRA savings and investment savings to weather the future expenses in TV, for taxes and a cash flow statement to see when additional withdrawals may be required. (I have not factored in the latest increase in AUTO insurance premiums ) After researching IRMAA, a hot topic du jour for some, I modeled out a married couple, with both at current max social security, again maybe us , with IRAS with RMDs, as everyone has. With the model being dynamic, the starting point is we are both 65 at the end of this year, start taking Social security on Jan 2025, when I qualify for full retirement benefits for both. At that time, i am assuming 5 k in additional taxable income above SS from any other sources, investments, part time work, etc. Using inflation and other annual increasing assumptions (IRMAA threshold increased at nearly 6 % and Social security increased at 4%+ for CY24) and market returns for investments are 6% out for 20 years, the effect of RMDS can be seen in AGI and in taxes and tax brackets. By entering an CY22 ending IRA balance as a total for a married couple, here is the age and year we would have to pay IRMAA penalties based upon current RMD percentages, based on max SS, RMD and taxable income year by year Conclusion: Its not worth ROTH conversions and paying taxes now to save future IRMAA penalties in the future for married couples with IRAs less than $3,000,000 certainly its a non issue for us, and i suspect many others. I am more than willing to share the workbook after I detail out the IRMAA penalties by taxable income bracket, I just used the max penalty in the example, and since its per person for a couple, it gets a bit detailed to calculate out which person in a couple, so i just doubled the per person penalty. . (may need to research the married couple scenario a bit as well), however, i am still looking for a CFP willing to review it for reasonableness. There are a few financial types here who can PM me to discuss validation of formulas, but not assumptions) |
|
#2
|
||
|
||
Some of us are stuck paying confiscatory IRMAA Medicare premium surcharges no matter what we do or don't do short of giving most of our hard savings and investments to charity,.
__________________
"No one is more hated than he who speaks the truth." Plato “To argue with a person who has renounced the use of reason is like administering medicine to the dead.” Thomas Paine Last edited by manaboutown; 10-16-2023 at 02:57 PM. |
#3
|
||
|
||
Confiscatory? You are making so much money on your money that you are required to pay extra for government health insurance. Poor you. So much confiscation going on. Maybe they should rework the medicare premiums so the super rich get a better break and the average retiree pays more to make up the difference. Let them eat cake comes to mind.
__________________
Men plug the dikes of their most needed beliefs with whatever mud they can find. - Clifford Geertz |
#4
|
||
|
||
Quote:
|
#5
|
||
|
||
Quote:
Are the "super rich" actually on Medicare? Don' t they use some sort of Concierge System? |
#6
|
||
|
||
To me it is like going into a McDonalds and buying a hamburger. If one is 'poor' he pays $5.00; if he is upper middle class he pays $50.00. Health insurance should cost the same for folks of similar age and health regardless of their income. Successful folks who usually started with little, worked hard, saved their money and invested wisely should not be forced to pay health insurance for profligate wastrels and deadbeats. That is socialism. Now if someone is or becomes disabled through no fault of their own then that is an entirely different matter. They need to be assisted.
__________________
"No one is more hated than he who speaks the truth." Plato “To argue with a person who has renounced the use of reason is like administering medicine to the dead.” Thomas Paine Last edited by manaboutown; 10-16-2023 at 06:37 PM. |
#7
|
||
|
||
Sorry, guy, I do not nor will I ever like generic financial advice. Every situation is different.
This one is not just about IRAs. It could be about a large capital gain from a stock sale in a taxable account or a sale of a secondary residence or one not held for 2 years as the primary. I am not a high net worth woman. I just happen to be an aware woman and if IRMAA is lurking around the corner, I think people should know they have a choice — if they want it — to give the amount that crosses the threshold to charity by using QCDs for some or all of the amount of the RMD. As far as those sweet-spot conversions go, I remain a proponent of at least learning about what you might be able to do. A conversion could end up being money for yourself down the road, not just for your heirs. You might need it to pay for your own healthcare someday. Like a previous poster here, I, too, am appalled at the “I got mine. Too bad ya don’t got yours” philosophy of those who cannot see that especially for those younger than us, there are many hard-working people who have been hit with obscene medical insurance and pharmaceutical costs, student loans that often look like usury lending, and ridiculous costs of housing. And about that tax cut for high net worth taxpayers and corporations — well, how’s that working for us regular people now? I am not into giveaways, but I am waaaaay into fairness — and I am worried that as a country, we could collapse under greed — and hate. Ya know, sometimes it’s good to be old. er Oh my, I sure jumped the track on that one. Not mad at you, guy. Just plain mad right now.
__________________
Pogo was right. Last edited by Boomer; 10-16-2023 at 06:44 PM. |
#8
|
||
|
||
Quote:
" In total, about 59.9 percent of U.S. households paid income tax in 2022. The remaining 40.1 percent of households paid no individual income tax. In that same year, about 47.1 percent of U.S. households with an income between 40,000 and 50,000 U.S. dollars paid no individual income taxes." From: Households paying no income tax by income level U.S. 2022 | Statista
__________________
"No one is more hated than he who speaks the truth." Plato “To argue with a person who has renounced the use of reason is like administering medicine to the dead.” Thomas Paine Last edited by manaboutown; 10-16-2023 at 06:43 PM. |
#9
|
||
|
||
Quote:
|
#10
|
||
|
||
Quote:
But you with your portfolio and your bonds and your IRAs and your 401Ks which just make you money while you do nothing contribute to the GNP, you make so much from being rich that a little more gets asked of you so the workers who are actually paying your medical costs and the other people on Medicare put in a little less. It is not McDonalds. It never has been. And now you want to base health insurance premiums on the health and age of the insured. Thank your lucky stars that ACA and Medicare did away with such things. Decency, do onto others, share your toys... Did you miss those lessons in basic humanity before you decided dollars are so golden??
__________________
Men plug the dikes of their most needed beliefs with whatever mud they can find. - Clifford Geertz |
#11
|
||
|
||
This thread deviated quickly from the OP’s financial modeling post.
|
#12
|
||
|
||
Quote:
|
#13
|
||
|
||
This is spot on.
|
#14
|
||
|
||
Quote:
https://www.irs.gov/pub/irs-soi/20in41ts.xls |
#15
|
||
|
||
Boy, and I thought I was Anal-litical!!
|
Closed Thread |
|
|
|