Chrysler Sailors Forum

Two things first. I'm no expert so take from this what ever you want.

Secondly advice or information spewed is generally usless without something to back up any stated facts.


So to follow up later on my comments for yourself,
click
http://finance.senate.gov/legislation/d ... 708697eff0
On that site, click the PDF labeled
Summary of Reid-McConnell Tax Relief, . . . .

in that document scroll to section labeled:
VI. Temporary Employee Payroll Tax Cut


These are my thoughts and not simply pulled from the many internet sites and pasted here.


OK,
bare with me and read on.
Everyone knows they SHOULD invest in their future however most folks think, NOT NOW, I can't afford it. Especially these days.
Well, that bill has been signed and everyone for all intensive purpose is going to get an unexpected effect of a 2% pay increase this year. This is for sure temporary and that fact is important so hang with me and follow along. YEAH! I highly recommend you increase your 401K contributions by . . . . say 2%!!! Net affect is no change in your current income, you are now saving if it is your first 2% or maybe you've simply increased your current contributions. Now some employers will match some of your contribution! YEAH!! Lets say you currently contribute nothing AND your employer will match up to 3% of your contribution ( this is pretty common ). If you take this 2% tax cut, instead of spending it, contribute it to your 401K, get a 2% match from your company, you can effectively be saving 4% for FREEEEEEE! WOW! Seriously, it is all how you look at things. OK, I know everyone is in a different situation and every has excellent reasons to NOT save for themselves. So this idea may not work for everyone. However, if you pay Social Security taxes in the US this will affect you. Yes, I have already changed my contributions so I'm not spewing crap. I'm sharing something I believe in and ACT ON for myself.

However there is a DOWNSIDE to this 2% tax cut or as I prefer to call it PAY RAISE. It is temporary. So lets say you take the money today and make no changes to your savings. YEAH free 2% increase in MONEY! Yeah I know, you're thinking that is not much . . . well it adds up over time. When the temporary bill goes away, you will no longer see this tax relief of 2% or in my books you'll get a decrease in pay by 2%! Now THAT hurts! especially 2 or 3 or 1 year from now when our grand politicians change their minds. YIKES! Oh wait if you started or increased your savings, 401K, 403B, roth or other savings tool by 2% now, when the tax relief goes away, you can decide to take the hit OR simply decrease your contributions by the same 2% and there, no impact to your income!!! YEAH! All the while the tax relief was in affect you were saving for your retirement FOR FREEEEEEE!

So, for all the folks who say they just can't save, here is a chance to not only save but prevent getting hurt when the relief goes away! Because you know as well as I, the tax relieve will simply get absorbed into your daily budget and will go generally go unnoticed if you do nothing. In a short time you'll, as I, will forget it was even there. When the relief goes away and you suddenly see a 2% decrease in income, you'll notice THAT for sure!!

I also understand that maybe 1 person in 100 will read, understand, and ACT on this concept to help themselves so I DO NOT believe I am under mining President Oboma's intent to stimulate the economy!!



Lastly:
If you already save for your future already you are probably reasonably versed in some concerns I will lay out:

1) if you get a company match, be aware of over saving in the 401K. Don't meet the yearly maximum to early in the year. You may loose company matching funds.
2) take a look at post tax and pre tax saving mechanisms. see what works best for you.
3) if married, consider your spouse and getting them to do the same.


So then, for all you folks in need of a chance to start saving, THERE. A free oppurtunity without impact to your budget.


Again, please note, I am no expert. I am not a tax consultant, CPA, or IRS employee! LOL!
I simply see a chance to create wealth for me and thought I'd share with my Chrysler buddies.


I'm very open to ANY comments, opinions, or rebutals against my thoughts.

EE: If I stepped out of line here please feel free to remove my entire post and chastise me publically so folks will not follow my methods! LOL!

Scott

PS: If you have any interest in my comments and want to discuss further, just PM me here. If you want explaination I'm happy to help but again. I'm no expert. I'm a simple kind of guy who acts on simple and sound concepts. Notice the key word "ACTS".

Right on! However, perhaps this type of conversation should be posted in the general discussion topic area, not in the sailing discussion area... Just a thought. Unless it helps me save for a bigger boat!

Nope Scott no problems here - you sent an email and asked the site admin about it, and you aren't selling anything that personally is in your "commercial" interests. And its good food for thought !

Anybody who wants any more info, send the man a PM like he asked and have some good conversation !

Scott....I am going to up my 401K contribution as suggested....That is a great idea that probably wouldn't have occurred to me...Thank You!!!


P.S. as far as the change going away any time soon, I believe that the Republicans will try their damnedest to extend it or make it permanent. That way they can keep Social Security underfunded and accomplish their dream of privatizing it by making sure it fails.

Awesome Bill!
I'm glad at least some folks see the advantages a person could take here!

Also with the utmost respect for you, I would caution about political comments. This forum is a wonderfull forum that has not been politically or religiously charged. I believe that is one of the major attributes of the forum! I really like it that way! I bet many folks feel the same way!



Did ya go for the full two percent? I did!!!
My company also allows you to set up an automatic increase of percentage on a yearly basis and you get to pick when! I set mine up to corrospond with pay raises!!! makes the increase simple and goes un noticed!

Scott

Scott...I haven't made the increase yet but will do it this week...and yes I will take the full 2 percent. I am fortunate to work for a corporation who does the match and it sure does add up over time.


I was just making a prediction as to where this legislation may go in the near future. I do realize that there are also some Democrats and other independents who view Social Security as a socialistic entitlement.

Those who can utilize this 2% increase as a way to save for retirement are truly fortunate...but unfortunately those who need it most for some sort of retirement savings are going to probably have to use it just to keep their heads above water for a little longer.

Thanks for all the good advice/info that you provide on the forum. We are lucky to have knowledgeable folks like you helping out us novice sailors.

Bill...wanna be seadog...

P.S. I have a pretty thick skin....LOL

Good deal on the savings plan!

Also good deal on the thick skin! No more Mr. Nice Guy from me! LOL!
I'm glad you understand!

Scott

...But yet we own these things called "SAILBOATS" that by the nature of the beast, I don't think will ever cost me less than 2%.
So save $ however you can, but sailing will always give you more than a 2% return...mentally

Well I looked at how much more I actually took home on my paycheck....$12 more in the bank.....I decided to stimulate the economy instead and ordered a new IDA Rudder for my C22....$ 479 and they said they would ship it free if I ordered this week...that's a savings of $55.

I think that stocks are going to revalue downward within the next 6 months anyway....might as well wait until they are cheaper so you get in low.

I agree astrodad. I don't believe we've seen the bottom of this market.

Good advice 69 and good tip on the new tax law. Take whatever you can get from the govt. any time you can. They sure take ours from us!

As my wife and I have always been self employed we started setting aside not long after we were married, 32 years ago, and increased it at every opportunity. Right now I don't know if there's anything left to set aside as it's a fair chunk every month. Still probably won't be able to retire til at least 65.

Whereas, I, on the other hand, spent 23 years working with the absolute dregs of society to earn a pension that was designed to lose 1% per year to inflation. And that was before this president decided not to give federal employees or annuitants any pay raise for the last two years. I find myself wondering just how long that pension will actually be good.

That's not the reason I started to get my teaching certificate but it sure does figure into things nowadays.