Which one will you make?
Which one will you make?
2 Major Mistakes
Inflation isn’t news anymore. It’s your daily battle. Now you get to appreciate the stress your parents or grandparents endured in the 1970s and early 1980s.
As you steam at the cunning shrinkflation in the grocery store or at the extra digit by the dollar sign on the gas pump, idling in the back forty is the taxation steamroller. Any adult conversation about the cost of living over the rest of your life must consider the consequences of accelerated federal spending. The inflation steamroller fueled by the federal checkbook is rolling in first gear. The taxation steamroller remains in park, poised to roll you from behind.
Living at a time where volume sadly gets more results than reason, how can you know if the taxation steamroller will bear down on you? After all, it’s the rich who “need to pay their fair share.”
It comes down to the loudest definition of “rich.”
Consider my hypothesis: “Rich” (or whatever it’s being called) will be the top 45% of income earners in the voter pool. Disregard for the moment how the voter pool will be determined. If aggressive tax policy ignores the majority of the voter pool, then those in the affected minority will lack voting power.
Of course this is overly simplistic. But it should get you thinking.
Planning decades ahead is largely a product of assumptions, some of which will be mistaken. Despite your mistakes, that you planned at all could put your retirement income in the top 45%. You’ll be rich in the eyes of the majority.
So, which taxation assumption mistake would you rather make?
A. Defer (postpone) your tax obligations because you assume that taxes will be lower during retirement, then discover during retirement that they are higher?
B. Pay your tax obligations sooner rather than later because you assume that taxes will be higher to discover that during retirement they are lower?
The outcome of mistake A is that you run out of money sooner.
The outcome of mistake B is that, even if you might have had more money with mistake A, you end up knowing with more certainty how much money you actually have to live on.
When you’re 90 years old, will you call certainty a mistake?
2 Major Mistakes
Inflation isn’t news anymore. It’s your daily battle. Now you get to appreciate the stress your parents or grandparents endured in the 1970s and early 1980s.
As you steam at the cunning shrinkflation in the grocery store or at the extra digit by the dollar sign on the gas pump, idling in the back forty is the taxation steamroller. Any adult conversation about the cost of living over the rest of your life must consider the consequences of accelerated federal spending. The inflation steamroller fueled by the federal checkbook is rolling in first gear. The taxation steamroller remains in park, poised to roll you from behind.
Living at a time where volume sadly gets more results than reason, how can you know if the taxation steamroller will bear down on you? After all, it’s the rich who “need to pay their fair share.”
It comes down to the loudest definition of “rich.”
Consider my hypothesis: “Rich” (or whatever it’s being called) will be the top 45% of income earners in the voter pool. Disregard for the moment how the voter pool will be determined. If aggressive tax policy ignores the majority of the voter pool, then those in the affected minority will lack voting power.
Of course this is overly simplistic. But it should get you thinking.
Planning decades ahead is largely a product of assumptions, some of which will be mistaken. Despite your mistakes, that you planned at all could put your retirement income in the top 45%. You’ll be rich in the eyes of the majority.
So, which taxation assumption mistake would you rather make?
A. Defer (postpone) your tax obligations because you assume that taxes will be lower during retirement, then discover during retirement that they are higher?
B. Pay your tax obligations sooner rather than later because you assume that taxes will be higher to discover that during retirement they are lower?
The outcome of mistake A is that you run out of money sooner.
The outcome of mistake B is that, even if you might have had more money with mistake A, you end up knowing with more certainty how much money you actually have to live on.
When you’re 90 years old, will you call certainty a mistake?
Just for answering, get Free access to Tom Hegna's Retire Happy U
Tom Hegna
Tom Hegna is an economist, author, and host of the PBS special, Don't Worry, Retire Happy, viewed in over 80 million homes across the U.S.
Just for answering, get Free access to Tom Hegna's Retire Happy U
Tom Hegna
Tom Hegna is an economist, author, and host of the PBS special, Don't Worry, Retire Happy, viewed in over 80 million homes across the U.S.
- garth@garthhassel.com
- (208) 497-5347
Garth Hassel
Retirement Income Strategist
Garth Hassel is a best-selling author, speaker, and wealth architect with over 15 years of experience in the financial services industry. As a navigator of the financial seas, he sees what others can't, charting safe conventional and alternate routes to his clients' destinations. He can be reached at garth@garthhassel.com.
- garth@garthhassel.com
- (208) 497-5347