It's Time For Medicare (whether I want it or not)

LouNY · Mar 12, 2022

Let's see if I can get this straight in my mind.
You are complaining that if you get $50,000 per year in SS that 85% is taxed, then because Medicare is deducted and if you are already in a high tax bracket the remaining is a pittance.

Part A premium

Most people don't pay a monthly premium for Part A (sometimes called "premium-free Part A"). If you buy Part A, you'll pay up to $499 each month in 2022. If you paid Medicare taxes for less than 30 quarters, the standard Part A premium is $499. If you paid Medicare taxes for 30-39 quarters, the standard Part A premium is $274.

Part B premium

The standard Part B premium amount is $170.10 (or higher depending on your income).

File individual tax return	File joint tax return	File married & separate tax return
If your yearly income in 2020 (for what you pay in 2022) was	You pay each month (in 2022)
$91,000 or less	$182,000 or less	$91,000 or less	$170.10
above $91,000 up to $114,000	above $182,000 up to $228,000	Not applicable	$238.10
above $114,000 up to $142,000	above $228,000 up to $284,000	Not applicable	$340.20
above $142,000 up to $170,000	above $284,000 up to $340,000	Not applicable	$442.30
above $170,000 and less than $500,000	above $340,000 and less than $750,000	above $91,000 and less than $409,000	$544.30
$500,000 or above	$750,000 or above	$409,000 or above	$578.30

So if you paid into Medicare for more than 40 quarters (only 10 years) no cost for part A,
then heck say under $200,000 for joint it would be $238.10 a month for part B,
so 12 times $238.10 is $2857.20 per year.
Then 85% of $50,000 is $42,500 is part of your taxable income even if taxed at 25% leaves $31,875 minus
the part B leaves $29,017.80 divided by 12, or $2418.15 per month.

To me that is a pretty decent pittance and certainly not to be sneezed at.

Now if you didn't pay in and have to pay the full part A and part B yes that would alter the numbers considerably,
of course if you didn't pay in what in the heck would you have to complain about.

So complain all you wish as far as I can see you have no grounds to gripe about anything.

Fuddy1952 · Mar 12, 2022

Sorry you went to all that trouble.
A pittance to one may not be to another.
Wife & I paid into SS well over 40 years. What we receive vs paid in was my point.
It's all moot point since everyone's lifestyle/expenses are different.
I'm not griping or complaining simply saying we could receive nothing in SS, it wouldn't amount to anything. In fact I'd be far ahead not getting it but investing that 40+ years paying into it myself.
Seniors relying on SS to live on, especially in these inflationary times I don't see how they manage.

LouNY · Mar 12, 2022

I'll certainly agree with that statement, if I had invested everything I have paid into SS over my lifetime
I could have a higher return by far. And I would expect that many people are in that situation.
However many people would not have put 7% plus the 7% the employer paid in, in safe investment accounts and not touched it
for many decades.
I would not want to live on only SS, but it was not meant to be the only retirement income it was to be a safety net for
lower income people.
So I would say it is doing as designed, it is as a very socialistic program and was even more so when put in place as none of the very early receivers had ever paid any thing into it.

Gale Hawkins · Mar 12, 2022

Our company matched up to 6% for retirement account and it was mind boggling how many would not participate. That 6% was bonus.

Jstpssng · Mar 12, 2022

Gale Hawkins said:
Our company matched up to 6% for retirement account and it was mind boggling how many would not participate. That 6% was bonus.

The company I work for was founded around 100 years ago, and survived many things including the depression. The founder set up a retirement account in the 50s, and always said "No former employee of mine is going to be in a bread line."
They match 50%, up to 6% of our income, plus profit sharing. If somebody isn't paying in, the comptroller will take the time to talk to him about it.

It was pretty discouraging to check my balance in January, and find that even after their annual contributions my balance went down, so I didn't hit my goal for 2021. I don't have a lot in the stock market or it would have been worse.

Gale Hawkins · Mar 12, 2022

How Much Can a Retired Person Earn Without Paying Taxes? - SmartAsset

Having an IRA or 401 plan is awesome but those deferred income taxes can trigger more taxes on SS . No complaints but until the wife retires there's little we can do to minimize taxes on SS receipts.

Roth IRA just didn't get much press early on.

Gale Hawkins · Mar 12, 2022

Jstpssng said:
The company I work for was founded around 100 years ago, and survived many things including the depression. The founder set up a retirement account in the 50s, and always said "No former employee of mine is going to be in a bread line."
They match 50%, up to 6% of our income, plus profit sharing. If somebody isn't paying in, the comptroller will take the time to talk to him about it.

It was pretty discouraging to check my balance in January, and find that even after their annual contributions my balance went down, so I didn't hit my goal for 2021. I don't have a lot in the stock market or it would have been worse.

I expect between inflation and bear market we may see a 50% reduction in our retirement accounts near term. In 2000 we had a depression era family member that lost 50% of a very large retirement account and it really impacted him in the negative way. I think we forget the money in our our IRA or 401 retirement account is not our money but it is the market's money is if we leave it in the market.

JethroB · Mar 13, 2022

Jstpssng said:
The company I work for was founded around 100 years ago, and survived many things including the depression. The founder set up a retirement account in the 50s, and always said "No former employee of mine is going to be in a bread line."
They match 50%, up to 6% of our income, plus profit sharing. If somebody isn't paying in, the comptroller will take the time to talk to him about it.

It was pretty discouraging to check my balance in January, and find that even after their annual contributions my balance went down, so I didn't hit my goal for 2021. I don't have a lot in the stock market or it would have been worse.

I had a similar experience. Early in my career I was tapped on my shoulder and turn to see our CEO. He was going around encouraging participation in the 401k plan. I was contributing 4% and he suggested I go to the full 6%. Learned later that our plan always struggled with being top-heavy (ERISA rules) due to not enough lower earners participating.

fishheadbob · Mar 13, 2022

"If I took all that money and invested it, I'd have a lot more now."
True that.
But then there are always people who get have life dump on them unexpectedly. My father-in-law broke his neck as a younger man and had SS, VA, and not much else, to carry him and his kids for the next 25 years. How about my son who died at 34. So far his widow and kids have pulled in well over $300,000 in SS with a few years left on the youngest one's eligibility. People figure those horrible things always happen to someone else.
You gotta have some sort of insurance.