That gets us back to your main point (here and in other articles). The US has a progressive tax and health care system - mostly. Tax rates increase with income. Medicare costs increase with income / wealth withdrawals from retirement accounts. We don't have great healthcare options for younger people who aren't covered by work-sponsored insurance or who qualify for an assistance program of some sort. If this was the result of a reasoned policy debate or election results, we'd say that's our choice v. Europe's choice. Sadly, the general sense from HD readers is that our tax / health system has been cobbled together over years without much thought. We just deal with the results.
Yup, there ain't any free. The sales tax / VAT in the UK is 20% on most things (other than food and children's clothing). Tell an American that they have to pay that much and loads of tea go into the harbor. . . .
Um, I can't think of any retail store that (a) isn't based on / doesn't encourage impulse buying or (b) only sells wholesome, healthy products. We're empty-nesters, and just bought a cartload of fresh berries, seafood, imported cheese, etc. at Costco today. Great savings over a local chain store. And the annual fee is easily covered over the cost of a year or by a major purchase. Take a look at the interesting article in the Wall Street Journal this week about how well employees are treated, too. Yup, I'm a fan.
Good example, Mr. Q., and good to give perspective on the tax system. And no doubt but that there are taxpayers in the situation you described. But tweak it slightly - single person instead of a family, married couple with two salaries and no kids - and the tax burden gets considerably higher. Open question about which is more representative of the country. And I'd politely suggest that HD readers are in a different situation / stage of life too. But the main point that federal income tax is reasonably low (as compared to other nations) holds true.
What allowed me to plan and act on that plan? The set-it-and-forget-it of payroll deductions into the Thrift Savings Program (the 401k for federal workers). Saving money you never see, and investing it into low cost index funds. It helped to have steady, decent-paying professional work for most of my career as a fed - something that today's younger gig workers may not have. Saving the maximum amount plus the 5% match plus over-50 additional contributions just added up over the years. Nothing sexy, but it matches the HD approach.
Well, quick solutions are either an equal weight fund (not quite 493, but minimizes the concentration issue) or an S+P fund plus 7 put options. The risk is real; are you willing to pull the trigger on a change, though?
Any reasoned decision is likely a good one. This was well reasoned, so don't second-guess yourself! My only quibble is with the ever-present use of the term "full retirement age." I know that it's in the statute, but it's pretty meaningless. A person can claim anywhere along the line from 62 to 70 with correlating benefit amounts. There's just nothing significant about the FRA number. As other HD writers have noted, it gives a false impression that the average / typical / smart person should stop work at 66ish. That's plain misleading. And confusing, when you consider the different (and more meaningful) age parameters for Medicare (65) and RMDs (72).
First world issues here - pay for biz class instead of waiting for an upgrade earned by other travel? Buy a disabled kid a house free and clear? Sure, generosity and grace from the super-prosperous is to be encouraged. But I agree with Richard Quinn below. This is not the circumstance of the typical American retiree. Nor is it representative of the typical reader of this website, I suspect. I value Prof. Statman's published scholarly work a great deal. This article reads much more like a HumbleBrag than a practical piece of HumbleDollar advice.
Comments
That gets us back to your main point (here and in other articles). The US has a progressive tax and health care system - mostly. Tax rates increase with income. Medicare costs increase with income / wealth withdrawals from retirement accounts. We don't have great healthcare options for younger people who aren't covered by work-sponsored insurance or who qualify for an assistance program of some sort. If this was the result of a reasoned policy debate or election results, we'd say that's our choice v. Europe's choice. Sadly, the general sense from HD readers is that our tax / health system has been cobbled together over years without much thought. We just deal with the results.
Post: A taxing situation, but is it reality?
Link to comment from July 12, 2026
Yup, there ain't any free. The sales tax / VAT in the UK is 20% on most things (other than food and children's clothing). Tell an American that they have to pay that much and loads of tea go into the harbor. . . .
Post: A taxing situation, but is it reality?
Link to comment from July 12, 2026
I'll make sure not to invite you to breakfast at any diner that offers a stack of three pancakes on the menu. Only one for you, Mr. Q!
Post: Frittering away Frugality
Link to comment from July 12, 2026
Um, I can't think of any retail store that (a) isn't based on / doesn't encourage impulse buying or (b) only sells wholesome, healthy products. We're empty-nesters, and just bought a cartload of fresh berries, seafood, imported cheese, etc. at Costco today. Great savings over a local chain store. And the annual fee is easily covered over the cost of a year or by a major purchase. Take a look at the interesting article in the Wall Street Journal this week about how well employees are treated, too. Yup, I'm a fan.
Post: Frittering away Frugality
Link to comment from July 11, 2026
Good example, Mr. Q., and good to give perspective on the tax system. And no doubt but that there are taxpayers in the situation you described. But tweak it slightly - single person instead of a family, married couple with two salaries and no kids - and the tax burden gets considerably higher. Open question about which is more representative of the country. And I'd politely suggest that HD readers are in a different situation / stage of life too. But the main point that federal income tax is reasonably low (as compared to other nations) holds true.
Post: A taxing situation, but is it reality?
Link to comment from July 11, 2026
Yes. Increases the amount contributed by about one-third. In a rising market, the catch-up contributions really accelerated the investing.
Post: Why can’t more people plan for their retirement future?
Link to comment from June 28, 2026
What allowed me to plan and act on that plan? The set-it-and-forget-it of payroll deductions into the Thrift Savings Program (the 401k for federal workers). Saving money you never see, and investing it into low cost index funds. It helped to have steady, decent-paying professional work for most of my career as a fed - something that today's younger gig workers may not have. Saving the maximum amount plus the 5% match plus over-50 additional contributions just added up over the years. Nothing sexy, but it matches the HD approach.
Post: Why can’t more people plan for their retirement future?
Link to comment from June 27, 2026
Well, quick solutions are either an equal weight fund (not quite 493, but minimizes the concentration issue) or an S+P fund plus 7 put options. The risk is real; are you willing to pull the trigger on a change, though?
Post: Does Vanguard Know Something?
Link to comment from June 27, 2026
Any reasoned decision is likely a good one. This was well reasoned, so don't second-guess yourself! My only quibble is with the ever-present use of the term "full retirement age." I know that it's in the statute, but it's pretty meaningless. A person can claim anywhere along the line from 62 to 70 with correlating benefit amounts. There's just nothing significant about the FRA number. As other HD writers have noted, it gives a false impression that the average / typical / smart person should stop work at 66ish. That's plain misleading. And confusing, when you consider the different (and more meaningful) age parameters for Medicare (65) and RMDs (72).
Post: Ten Reasons to Claim
Link to comment from September 13, 2022
First world issues here - pay for biz class instead of waiting for an upgrade earned by other travel? Buy a disabled kid a house free and clear? Sure, generosity and grace from the super-prosperous is to be encouraged. But I agree with Richard Quinn below. This is not the circumstance of the typical American retiree. Nor is it representative of the typical reader of this website, I suspect. I value Prof. Statman's published scholarly work a great deal. This article reads much more like a HumbleBrag than a practical piece of HumbleDollar advice.
Post: Retire Those Fears
Link to comment from February 9, 2022