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I say it all the time , im not convinced middle americas income taxes will be touched for decades. With 80 million retiring baby boomers i cant imagine any political group telling them they are raising income taxes.
In fact at the 3% a year that income taxes have been falling for decades pretty soon 25% will be 100k .
I do see payroll taxes , sales taxes ,real estate taxes and anything else that they can tax rising big time.
But non the less it cant hurt to do a roth in the mix covering tat base too
oh i agree! won't be touched for decades. just another way my generation will get screwed into paying for the baby boomer generation that enjoyed deflated tax rates. i'm 3 decades from retirement, so i understand the risk that i'll be in a higher income tax bracket, and even if i'm not, that at least all brackets will have higher % tax rates.
maybe i'll get lucky and it will happen to the generation slightly behind me instead of to me. but i doubt it.
but that's a personal choice. like i said...it depends on the OP's goals.
its definitely a personal choice. if someone likes to personally get screwed over, then they should invest heavily in tax deferred accounts. but thats my opinion, i just think people are being told how wonderful these tax deferred accounts are and they have no concept of the risks involved.
i dont put any money into an IRA and i have access to all my money whenever i want to access it and i dont have to worry about what my tax rate will be 30 years from now.
its definitely a personal choice. if someone likes to personally get screwed over, then they should invest heavily in tax deferred accounts. but thats my opinion, i just think people are being told how wonderful these tax deferred accounts are and they have no concept of the risks involved.
i dont put any money into an IRA and i have access to all my money whenever i want to access it and i dont have to worry about what my tax rate will be 30 years from now.
you're probably right that a lof of people aren't looking at the downsides and risks to investing in only tax deferred accounts.
but, if you're "guess" is wrong, and it is just a guess...then your investment choices of avoiding tax deferred exposes you to risks that your money won't be worth as much due to higher taxes.
i agree that's unlikely, but i personally like the diversified approach that hedges both possibilities. that doesn't mean i'll get screwed over, i just miss out on the benefits of either outcome.
For most of america that can't save a dime on their own a 401k is most likely the best thing going for them. it may not be for you but without the forced savings they would really be screwed .
For most of america that can't save a dime on their own a 401k is most likely the best thing going for them. it may not be for you but without the forced savings they would really be screwed .
its in an interesting concept that you have to put your money into a horrible investment (we are already forced to do that via social security) in order to guarantee some kind of savings. intelligent people should know better, i know many dont.
its in an interesting concept that you have to put your money into a horrible investment (we are already forced to do that via social security) in order to guarantee some kind of savings. intelligent people should know better, i know many dont.
1. social security is not an investment.
2. why is a 401k a horrible investment? do you feel that way only because it is tax deferred?
its in an interesting concept that you have to put your money into a horrible investment (we are already forced to do that via social security) in order to guarantee some kind of savings. intelligent people should know better, i know many dont.
You keep saying that but that is only your opinion.. the fact is that most retirees who have done it, had a plan and stuck to it are retiring with very nice amounts. my self included.......
want proof, google the fidelity study that found their average 401k for those over 55 who contributed from 1/2 to full max and did so only the last decade went from 96k to 216k.... 2/3 contributions from employers and themselves and 1/3 gains. not to shabby in a decade with 2 back to back recessions.
most of those folks would have zip listening to you. if you think its horrible dont take part but thats not the way many of us see it.
2. why is a 401k a horrible investment? do you feel that way only because it is tax deferred?
12% of your income goes into social security on your behalf while you work. you expect some return when you retire and you also expect certain insurance benefits. it sounds like an investment to me. its a bad one because the government can ********* on it at any time.
You keep saying that but that is only your opinion.. the fact is that most retirees who have done it, had a plan and stuck to it are retiring with very nice amounts. my self included.......
want proof, google the fidelity study that found their average 401k for those over 55 who contributed from 1/2 to full max and did so only the last decade went from 96k to 216k.... 2/3 contributions from employers and themselves and 1/3 gains. not to shabby in a decade with 2 back to back recessions.
most of those folks would have zip listening to you. if you think its horrible dont take part but thats not the way many of us see it.
i think its a fact that its a bad investment. but i agree it probably benefits stupid people who otherwise wouldnt save for themselves. those numbers from that fidelity study dont look impressive to me, plus it appears they will then have to pay income taxes from that 216k.
especially with a longer time horizon to when you can withdraw, the risks of the tax deferred account far outweigh any potential benefits.
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