AUTHOR: Howard Schwartz on 8/21/2025 FIRST: Mark Crothers on 8/21/2025 | RECENT: Mark Crothers on 8/21/2025
Comments
Social Security taxability is not based on MAGI. It is based on combined income which includes AGI plus non-taxable interest plus half of Social Security benefits.
My wife and I bought a new free-standing home in a NJ development that was started about 12 years ago. It will ultimately have 315 homes. We pay $367 per month to the HOA. If fact, there is an open meeting tonight. The HOA fee covers the usual maintenance items and the contingency fund is adequate. Unfortunately, the clubhouse flooded during the winter due to a frozen pipe in the fire suppression system and has been closed since. I hope to find out tonight which insurance company is going to pay for the repairs and remodeling. We assumed when we bought the home that we will have to absorb fee increases and also may have assessments if the need arises. Since we are not attached to any other homes, we are responsible for all repairs and maintenance of our home. The builder did provide a 10 year warranty on his work. It is tricky to predict the future. Something is bound to go wrong.
Your wife's planner was lucky. He performed a fixed income version of market timing. For every one like him who made the right call at the right time, there are 10 or 20 who did not. His chance of continuing the hot streak is very low. Having said that, tax planning and asset location are very important and probably worth the money.
I spent part of my career selling 401(k) plans to employers. I found even the executives at the companies I sold to were woefully ignorant about personal finance. One CFO of a company with thousands of employees asked me after my presentation what a mutual fund was. I also made presentations at enrollment meetings and found it difficult to engage the employees. Their attention span was just not up to listening to a topic they had not encountered before with strange language. One meeting that I still remember involved mostly Haitian employees who did not speak much English. The interpreter later told me that the foremen who the employees trusted told them that the employer was using the plan to steal their money, so no one participated even though there was a generous employer match. Depending on regular Americans to save enough for a retirement that is decades away is close to hopeless since they need to pay rent and buy food today. I wish we could reform the Social Security system to better serve the needs of the majority of people who need help. I do not think our politics will allow it as raising taxes is never popular. You need to take care of yourself and your family, because sadly, no one else will.
I am not an early adopter, and this product does not seem to offer me any benefit I can think of. The history of the financial services business is rife with new products that seemed to meet a need for a while and then did not. Of course, someone made money and others lost out. I remember portfolio insurance as one of the products that seemed like a great idea until everyone headed for the door at the same time. Also, any product promoted by Robinhood should immediately be suspect.
Best of luck with your new/old home. My wife and I sold our home of 32 years in September and moved 15 miles away to a 55+ community. I wish we had done it 10 years ago.
My wife and I are both collecting Social Security and enhance that with tax free munis in our taxable account and TIPs and senior loan funds in our traditional IRAs. The rest is in equity ETFs, mostly in the taxable accounts and Roth IRAs. Asset location is critical to managing taxes.
Very good post. I tried using CPAs twice and both of them used assistants to do my taxes who made many errors that I was responsible for finding. I do not think the CPAs even reviewed my taxes before delivering them to me for finalizing. I assumed they spent their limited time on business accounts who paid them real money, not my few hundred dollars. Anyway, this forced me to learn about taxes and do them myself using TurboTax which has worked pretty well for Federal and less well for NJ. So far, zero audits, so I guess I will keep it up.
Comments
Social Security taxability is not based on MAGI. It is based on combined income which includes AGI plus non-taxable interest plus half of Social Security benefits.
Post: Tax Free Income Trap, Dealing With MAGI
Link to comment from April 22, 2026
My wife and I bought a new free-standing home in a NJ development that was started about 12 years ago. It will ultimately have 315 homes. We pay $367 per month to the HOA. If fact, there is an open meeting tonight. The HOA fee covers the usual maintenance items and the contingency fund is adequate. Unfortunately, the clubhouse flooded during the winter due to a frozen pipe in the fire suppression system and has been closed since. I hope to find out tonight which insurance company is going to pay for the repairs and remodeling. We assumed when we bought the home that we will have to absorb fee increases and also may have assessments if the need arises. Since we are not attached to any other homes, we are responsible for all repairs and maintenance of our home. The builder did provide a 10 year warranty on his work. It is tricky to predict the future. Something is bound to go wrong.
Post: The condo, HOA, senior citizen conundrum
Link to comment from April 20, 2026
NJ gas tax is 49.1 cents per gallon. PA is 58.7.
Post: Penny Wise, Pound Foolish
Link to comment from April 16, 2026
Your wife's planner was lucky. He performed a fixed income version of market timing. For every one like him who made the right call at the right time, there are 10 or 20 who did not. His chance of continuing the hot streak is very low. Having said that, tax planning and asset location are very important and probably worth the money.
Post: One Good Call?
Link to comment from April 14, 2026
I spent part of my career selling 401(k) plans to employers. I found even the executives at the companies I sold to were woefully ignorant about personal finance. One CFO of a company with thousands of employees asked me after my presentation what a mutual fund was. I also made presentations at enrollment meetings and found it difficult to engage the employees. Their attention span was just not up to listening to a topic they had not encountered before with strange language. One meeting that I still remember involved mostly Haitian employees who did not speak much English. The interpreter later told me that the foremen who the employees trusted told them that the employer was using the plan to steal their money, so no one participated even though there was a generous employer match. Depending on regular Americans to save enough for a retirement that is decades away is close to hopeless since they need to pay rent and buy food today. I wish we could reform the Social Security system to better serve the needs of the majority of people who need help. I do not think our politics will allow it as raising taxes is never popular. You need to take care of yourself and your family, because sadly, no one else will.
Post: “We did everything right.” Maybe not. Retirement income should not be an unpleasant surprise.
Link to comment from April 12, 2026
I am not an early adopter, and this product does not seem to offer me any benefit I can think of. The history of the financial services business is rife with new products that seemed to meet a need for a while and then did not. Of course, someone made money and others lost out. I remember portfolio insurance as one of the products that seemed like a great idea until everyone headed for the door at the same time. Also, any product promoted by Robinhood should immediately be suspect.
Post: Stock Tokens
Link to comment from April 11, 2026
I'm in.
Post: Forum Rules
Link to comment from March 31, 2026
Best of luck with your new/old home. My wife and I sold our home of 32 years in September and moved 15 miles away to a 55+ community. I wish we had done it 10 years ago.
Post: A Big Little Move (by Dana/DrLefty)
Link to comment from March 30, 2026
My wife and I are both collecting Social Security and enhance that with tax free munis in our taxable account and TIPs and senior loan funds in our traditional IRAs. The rest is in equity ETFs, mostly in the taxable accounts and Roth IRAs. Asset location is critical to managing taxes.
Post: Coping with inflation in retirement, what’s the plan?
Link to comment from March 30, 2026
Very good post. I tried using CPAs twice and both of them used assistants to do my taxes who made many errors that I was responsible for finding. I do not think the CPAs even reviewed my taxes before delivering them to me for finalizing. I assumed they spent their limited time on business accounts who paid them real money, not my few hundred dollars. Anyway, this forced me to learn about taxes and do them myself using TurboTax which has worked pretty well for Federal and less well for NJ. So far, zero audits, so I guess I will keep it up.
Post: Wrapping It Up
Link to comment from March 29, 2026