I wanted to get something basic up here since we tend to dive into niche topics. Perhaps some basic information could be useful, even if it's used as a check list. I find that when I'm focusing on very specific things, the basic stuff falls through the cracks sometimes. For those looking to retire, here are 5 basic things you shouldn't forget before you retire.
1. Assess your personal savings
2. Map out a retirement budget
3. Read up on healthcare costs
4. Develop a strategy for claiming Social Security
5. Figure out what you'll do with your time
Pretty simple, right? It's mostly financial, but that is the most crucial, and makes it easier for the rest to follow. I think the most important one is number four. There are so many guidelines and options when it comes to Social Security, depending on whether or not you are married, a widow/widower, and if you will continue to work part time or start your own business. I would say that one should almost be number 1. I think the list follows more like steps instead of rated by priority. What are some others that should have been included? Would number three be a higher priority as well?
Tell me about it. I can see this becoming a common thing in the near future.
It seems as though there's a proposal circulating in the White House pertaining to those who receive Social Security disability benefits. The proposal would let investigators use someone's Facebook and Twitter as evidence that they are no disabled but are collecting disability checks from the government. So pretty much if someone claimed benefits for a back injury but was shown in a photo playing Frisbee, they could use it as evidence. A quote from the New York times sums up my opinion.
“It may be difficult to tell when a photograph was taken,” said Lisa D. Ekman, a lawyer who is the chairwoman of the Consortium for Citizens with Disabilities, a coalition of advocacy groups. “Just because someone posted a photograph of them golfing or going fishing in February of 2019 does not mean that the activity occurred in 2019.”
Right now, disability examiners do not routinely use social media, but they can refer cases to the inspector general, who can use it to corroborate information. According to a financial report, Social Security estimated that it paid $3.4 billion in over payments to disability insurance beneficiaries back in 2017, mostly because they didn't report work activities. That's a lot of money going out, that's for sure. Still, I think that photos on social media can be deceiving, say your significant other or spouse takes a photo of you 2 years prior to your injury, but you don't post it until after. How can that be used as evidence then? Most of the time, people like to post photos of themselves when they're happy or enjoying something, and sometimes they're throwback photos. What does everyone else think of this? Do you think photos from social media is strong enough evidence to prove fraud?
I agree with your point. I think our country is much too large for something like that to be successful. If it did work, it would take a long time, and a lot of mental back flips for everyone on board.
The administrator for the Centers for Medicare and Medicaid Services(CMS) said that the agency is proposing a way of boosting reimbursements for a customized approach called CAR T-Cell Therapy. According to an article I found on the subject, it has revolutionized treatment for patients with hard-to-treat pediatric leukemia and adult lymphoma. This particular cancer therapy is very costly, to say the least. Reimbursements in this area would definitely revolutionize how patients with blood cancers such as these handle their medical bills.
The administrator for CMS said:
The proposed changes are necessary because “Medicare’s antiquated payment systems” have not kept up with the development of “transformative technologies.” She said she is concerned inadequate payments might be prompting hospitals to limit Medicare patients’ access to needed therapies.
"The agency will boost the size of extra payments it makes to help hospitals incorporate new technologies and treatments into their clinics. Medicare now pays 50 percent of the additional costs of these innovative treatments, but is proposing to increase that to 65 percent."
The only drawback I find is that the extra payments are only available for the first few years a new product is out on the market. I'm hoping this is a supplementary part of the proposal. Or one could only hope that the treatment or drugs get cheaper as they age on the market. I think it's a step in the right direction. Perhaps we can narrow the margin in which patients with certain cancers like these have a hard time finding the treatment they really need. Is this a legit next step to change such an antiquated payment system? Or is it not enough?
I myself would consider just owing the government a 100 bucks or so a victory.
True, but perhaps applying said strategies could make that victory more of a possibility. I think the W-4 slips people's minds. They fill them out so infrequently, that I think many forget to adjust their W-4s as financial and life changes occur.
With the tax burden shifting due to the Jobs Act and Tax cuts, perhaps we can prevent having any surprises going forward. Or should I say, at least be prepared for such surprises in the future. This may not be for everyone, but I think it's still possible to pay very close to, if not exactly how much you owe every year, and in advance. I remember when I was younger that I would look forward to tax season. I'd get some money back, and say "see you next year." Now I'm just trying to get to that magic '0'. I found a pretty interesting article on the subject.
It says that only 6% of Americans actually get to the magic '0'. I just wonder if that percentage also includes those who received a refund. That's more than likely wishful thinking on my part.
Some of these things seem like a no-brainer. Perhaps it might get some of us thinking differently.
If you owe the IRS:
- Decrease the number of personal allowances on your W-4.
- Or, simply ask that a set amount be taken from each paycheck. To figure out how much, take the amount you owe and divide it by the number of pay periods remaining in the current year.
If you regularly get a big refund:
- Increase the number of personal allowances on your W-4.
- The adjustment will give you a bit more cash in each paycheck. Don’t just spend it, but consider opening an account — savings, money market or CD — that will earn you (not the federal government) interest instead.
The IRS provides a Withholding Calculator that could really help you clarify the exact amount of tax you want taken out of every paycheck. Of course, if there are significant life changes coming down the pipeline like marriage, buying a house etc, it may be a little difficult to figure out your precise tax burden in advance.
For those who pay estimated taxes, here's some advice to get you as close to the magic '0' as possible:
This is where meeting with a CPA in the final quarter of the year can be helpful; they can work with you to calculate that last estimated tax payment, taking business expenses and other deductions into account, so you don’t end up inadvertently underpaying or overpaying.
I think ending the tax year with having paid exactly what you owe the government is possible. With some extra effort, and the right tools, it can happen. Does anyone else agree, or has the tax code gotten so out of whack that it's impossible now? Any other tips are welcome as well.
I came a cross an article from the first of the year that I thought would be interesting. The Center for Medicare and Medicare Services (CMS) launched two new models in January. One is a new payment model and the other has updated an existing model which is aimed at lowering drug prices, and better serving patients of Medicare Part D and Medicare Advantage plans.
“Expanding choices for patients, aligning incentives, and providing new flexibility for insurers in Medicare Advantage and Medicare Part D will deliver better value from these programs,” said HHS Secretary Alex Azar.
The new Part D plan, called the Part D Payment Modernization Model, aims at creating incentives to lower drug prices, as well as out-of-pocket costs.
Another interesting point from the article:
Currently in Part D, when a patient’s prescription drug spending is high enough for the patient to enter the highest phase of the benefit, known as the “catastrophic phase,” Medicare is responsible for 80 percent of the drug costs.
With this rule in place, plans have little reason to negotiate lower costs for the highest-spending patients.
The new model would make it to where participating Part D plans would share in the savings if they stay below the target, but would be responsible for losses if they did. It would also provide tools to Part D plans to control drug costs and help enrollees choose more affordable drugs.
The update to the Medicare Advantage Value-Based Insurance Design model will allow plans to provide reduced cost sharing and other benefits to enrollees, in a much more targeted way.
The new model allows plans to boost the rewards and incentives programs that can help beneficiaries improve their health and increases access to telehealth services by allowing plans to use virtual services instead of in-person visits.
I think this is good news across both forms of Medicare. The main complaint about Medicare Advantage has been drug costs and limited networks. Think these new models could be better? What else should be implemented and reworked?
I'll admit, there have been times in the past where I have used a credit card to get me out of a financial pinch. I mean, that's one of the reasons why they are there, emergencies. I came across an article that weighed in on the pros and cons of using a credit card to pay your taxes, and I think it all comes down to your number of options and intent.
We pretty much all know that the IRS will take your taxes in a number of different ways, checks, electronic transfers, credit, debit, your first born, and blood. All joking aside, we have a number of options, but what if you only have one? See, there lies the predicament. You may be escaping a possible audit, but you're also trading one devil for another if you aren't careful. Paying your taxes with your credit card could really hurt your finances and credit score, especially if the balance sits long enough to accrue interest. According to the article, the average interest rate on a credit card is at 17.6%, which is a record high. Just remember, it isn't free to pay your taxes with a credit card.
For those who aren't limited to just their credit card, theres an upside to using it. Say you have enough cash to pay it and you have an open card just collecting dust and not rewards. You could use that opportunity to literally reap the rewards that you get on your card by quickly putting the balance on and paying it off.
That's certainly a good point. Thanks for adding that in there. I could see where in some areas of the country it would be beneficial to stay with Part D.