Experts expect the stock market to surge through the end of December.. Who doesn’t love an unexpected stock market rally? That’s if you’re invested in the market. Many people have made that mistake hoping that the Dow or S&P or NASDAQ could actually act rational.
In 2008 many people lost millions of dollars and many people still can’t retire. Smart people have said enough is enough – no more gambling for me. Scary times are ahead, but smart people actually welcome the next stock market crash. Everyone knows it’s going to happen. Asset classes are inflated until they burst. Who is going to get hurt? It’s the American people. By keeping money in a corrupt cycle you give bankers permission to pad their pockets even when the market crashes. A better way exists. If your storing your money in a 401K plan or IRA’s, you should consider privatizing your wealth with a “Cam IUL”. It grows tax deferred; it is protected from market crashes, and could provide you with a tax free cash flow for life.
Next week I will give you more details about this!!!
There were some minor changes made in 2015 for workers and retirees by the social security administration. Social security benefits increased starting January 2015, by 1.7% which is an average of $22.00 extra dollars per month. The average monthly payment is now $1,328 per month compared to $1,306 per month last year.
If you reach full retirement age in 2015, your maximum benefit will be $2,685.50 per month. If you delay receiving your social security benefits, your social security will increase approximately 8% per year until you reach age 70.
The amount of the base rate ($117,000) last year, is now $118,500 in 2015. The maximum in social security tax you pay is $7,347.
To qualify for social security benefits, you need to earn credits over your working career. Each credit you get is based on how much money you make. You are limited to 4 credits per year. You earn one credit for every $1,220 earned in 2015. If you take your retirement benefits before age 66 and you are working part time, the amount of your benefit is reduced based on the dollar amount you earn. For example, in 2015 you can earn $15,720 (gross pay) before your payments are reduced. If you earn more than $15,720 your payments will be reduced $1.00 for every $2.00 you earn. If you turn 66 in 2015 you can earn $41,880 (gross pay) before your benefits are reduced $1.00 for ever $2.00 you earn.
Medicare Part A deductible has increased from $1,216 to $1,260 for 2015. Premiums for Part D have increased on an average of 4% for 2015.
401K You can defer up to $18,000 of your income and another $6,000 if you reach 50 or older in 2015.
The total amount you can save (including employer contributions) is now $53,000 for 2015
Limits for IRA contributions are set at 2014 levels ($5,500 or $6,500, 50 and over)
The maximum income limit to qualify for a deduction on a traditional IRA is now $71,000 (single), $118,000 (married)
The maximum you can earn before being phased out of contributing to a Roth IRA is now $131,000 (single) $193,000 (Married).
The new “MyRA” is expected to come out this year as an alternative way for individuals to save. These accounts are similar to a Roth IRA and the annual income requirements will be under $129,000 (single) and under $191,000 (married).
You must know the difference between tax deferred and tax free. Most people have their money in a 401K, 403B and IRA’S. In these plans, money has not been taxed, but will be taxed at a later date. Our economy is in sad shape and make no mistake, taxes will go up in the future to pay for infrastructure and all the country’s needs that are being neglected. It will be the middle class (what’s left of it) who will foot the bill for this. Corporations and banks will not, because they have powerful lobbyists and they write the laws. The sooner you move your money to tax free territory, the longer it will last. People are generally more afraid of running out of money then dying. Under these plans, 401K, 403B and IRA’S, Uncle Sam is your partner. Every time your balance increases so does the government share. Your savings are being eroded with a tax mortgage. The sooner you get rid of your partner, (IRS), the sooner you will know how much money is yours to keep. Remember, there are 2 parts to managing your retirement money. The first part is building and investing your money and the second part is taking your money out and enjoying your retirement. The second part is where all the tax rules come into play. Managing the taxes will have the biggest impact.
You cannot afford to lose money going into retirement or in retirement. Now that you know there is a tax problem, you need a plan for your retirement savings. There will be a cost to this, but the cost will be far a greater if you ignore the problem. Converting your IRA to a Roth IRA eliminates the risk of what future taxes could do to your retirement savings. The best time to convert is between ages 59 ½ and 70 ½ when there are no IRA distribution penalties. In my next article, I will talk about life insurance, trusts and more details on how to set up a Roth IRA.