Social Security tax that deduct out of husband weekly paychecks. And when he Retire, - Talk About Marriage
Financial Problems in Marriage When financial times are tough, it adds to the stress we deal with on a daily basis. This section is for talking about how financial problems affect our relationships and ways to cope.

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post #1 of 10 (permalink) Old 03-19-2017, 11:38 PM Thread Starter
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Social Security tax that deduct out of husband weekly paychecks. And when he Retire,

Hello, and hope everyone hree in TAM have a great week ahead with your family and loved ones.

Hi, for starter I just want to say I know this section of the forum is title "Financial problems in marriage". We Don't have a financial problem, I just have a financial question. I think it go here because it financial related, my apology if I posted it in the wrong section of the forum.
I have a question below about Social Security tax and Social Security payment when a person retire at the retirement age. If anyone can help answer my question, thank you very very much for your help.

Husband work a dangerous job, he does loves what he do, and he does make decent income. He make a six-figures income (low six figures). He Debt-free.
Life is comfy for us. Husband he Debt-free (we both are. We both have zero debt). Plus we both are not big spender, and we do live BELOW our means; and it helps us alot with saving up, cash liquid assets and retirement savings. We do live BELOW our means.
Husband he work all his life, eversince his teens age. But it wasn't until he 23 (when he was working with Crude oil), that was when he started making a six-figures income. He is 31 now.
He very responsible with money, and due to he Debt-free which helps alot in saving up. He currently have a six-figures in his Retirement savings,--as in 401k/IRA.

Here is my question: I know yearly my husband max out his Retirement savings. I know the 401k and IRA are SEPARATE from Social Security taxes right?
I ask this because I see my husband paychecks (he gets pay weekly), and in his paychecks it automatically deduct for Social Security tax.
So when he retire, he can collect BOTH--simultaneously both his Social Security retirement (the Social Security tax that deduct from his paychecks), AND his 401k and IRA right?
The IRA/401k are his, he max it out every year. That is SEPARATE from the Social Security tax that deduct from his paycheck, so he should get BOTH simultaneously when he retire right? I mean it his hard work money, Social Security tax--the goverment deducted out of his paychecks.
.........
The thing is I heard that the government might say No and not give him his Social Security payment, due to his income and the six-figures he has in his 401k/IRA.. Can the goverment just do that to someone? Just due to they have more than decent money in their 401k/IRA?
(This is what I heard from one poster told me while was help give me advice, that the government can do that, I don't know how accurate.)--But I heard the goverment have the rights to eleminate someone Social Security payment when they retire, eventhough it is the government that deduct their hard work money out of their paycheck every week for Social Security tax.. BUT if the goverment see you have alot of money in your 401k/IRA, they will cut/eliminate your Social Security payment. (Government will keep that money and give it to those who make much less income and have much less in their retirement).

Can anyone help confirm that above, how accurate is this? Can the government do that to you?
So the government have the rights to cut your Social Security payment and not give it to you when you retire? Despite that it them that deduct the Social Security tax out of my husband weekly paychecks? ugh.. it my husband hard work money, and we can't get some back when he retire? Just because he has a six-figures in his Retirement savings 401k/IRA, so government decided that you have alot for your retirement already, so no Social Security payment for you?
ugh..
See, this is another reason why we save up and continue saving up as much 'cash' as we can in our Savings to help us in our old age, just in case the government decide to cut his Social Security payment. He still have is IRA, 401k, AND his saving accounts (the government can't touch his saving accounts).
Plus we need the money (Cash liquids) in our savings just in case for Medical bills in our old age, nobody can remain stay a perfect health in their old age.
We at the age (32 and 31), we don't have medical expense right now, but for sure when we old hit our retirement age we going to need those cash, because Health insurance can't pay 100% fully of every single medical expenses for us (and specially old age medical expense too), and we all know old age people when they get sick it can be very very expensive.

I want to make this clear. No, we not depending on Social Security payment. Ofcourse not. That is why we saving up as much 'cash liquids' as we can in our Savings accounts.. My husband do have a six-figures in his Saving accounts (yes, he has me as Joint on both his Saving accounts). In addition to a six-figures in his Retirement savings, his 401k/IRA (yes, he has me as the Primary beneficiary on his 401k and IRA). He is doing fine by himself alone with his income.
The thing is I hope he get 'some' of the Social Security tax that he been paying to the government all his life, at least get some back when he at old age. This is his hard working money, it the government that deduct it own of his weekly paychecks.
Personally,
I find it not fair if the government decide to cut his Social Security payment when he old and retire, just because he has a six-figures in his saving accounts, and a six-figures in his Retirement savings (his 401k/IRA).. It his hard work money that he work for, and he work a dangerous job too (day to day dealing Fuel which is highly flammable. Or Hydrofluoric Acid which is highly corrosive). Government deduct Social Security tax out of his weekly paychecks. I hope they at least give him 'some' back in his retirement old age. Arg! GOD DAMN IT!


If need live translation, I be more than happy to help. Chinese here & here. Vietnamese here.
LONG& TMI(Regard something my DH did 10 years ago); just so hard for me to understand

Last edited by jasmine31; 03-20-2017 at 04:22 AM.
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post #2 of 10 (permalink) Old 03-20-2017, 12:03 AM
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Re: Social Security tax that deduct out of husband weekly paychecks. And when he Reti

Quote:
Originally Posted by jasmine31 View Post
Here is my question: I know yearly my husband max out his Retirement savings. I know the 401k and IRA are SEPARATE from Social Security taxes right?
I ask this because I see my husband paychecks (he gets pay weekly), and in his paychecks it automatically deduct for Social Security tax.
Yes 401K, IRA and SS taxes are separate things. He pays 6.2% Social Security tax (old age, survivor, and disability insurance) on the first $127,200 he earns. His employer also pay Social Security another 6.2%.

They also withhold some for Medicare that he will be able to get when he’s retired or on disability.


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Originally Posted by jasmine31 View Post
So when he retire, he can collect BOTH--simultaneously both his Social Security retirement (the Social Security tax that deduct from his paychecks), AND his 401k and IRA right?
Yes

And as his wife, if you are married to him for 10 years or more, can draw social security on his account. While he is alive you will get 50% of what he gets. So let’s say he gets $2,600 a month.

You will get $1,300 a month. If he passes away before you, you will get his entire amount, or $2,600.

Quote:
Originally Posted by jasmine31 View Post
The IRA/401k are his, he max it out every year. That is SEPARATE from the Social Security tax that deduct from his paycheck, so he should get BOTH simultaneously when he retire right? I mean it his hard work money, Social Security tax--the goverment deducted out of his paychecks.
Yes

Quote:
Originally Posted by jasmine31 View Post
The thing is I heard that the government might say No and not give him his Social Security payment, due to his income and the six-figures he has in his 401k/IRA.. Can the goverment just do that to someone? Just due to they have more than decent money in their 401k/IRA?
The above is wrong. He is entitled to social security. His 401k & IRA savings will not impact what he gets from social security.


Quote:
Originally Posted by jasmine31 View Post
(This is what I heard only from one poster told me, that the government can do that, I don't know how accurate.)--But I heard the goverment have the rights to eleminate someone Social Security payment when they retire, eventhough it is the government that deduct their hard work money out of their paycheck every week for Social Security tax.. BUT if the goverment see you have alot of money in your 401k/IRA, they will cut/eliminate your Social Security payment. (Government will keep that money and give it to those who make much less income and have much less in their retirement).
Wrong

There has been talk about Social Security not paying monthly benefits to the super wealthy, like people who earn millions a year. But that’s not how it works wright now. And I as it stands right now, you two do not earn millions a year.

Quote:
Originally Posted by jasmine31 View Post
Can anyone help confirm that above, how accurate is this? Can the government do that to you?

So the government have the rights to cut your Social Security payment and not give it to you when you retire?

Despite that it them that deduct the Social Security tax out of my husband weekly paychecks? ugh.. it my husband hard work money, and we can't get some back when he retire? Just because he has a six-figures in his Retirement savings 401k/IRA, so government decided that you have alot for your retirement already, so no Social Security payment for you?

ugh..

See, this is another reason why we save up and continue saving up as much 'cash' as we can in our Savings to help us in our old age, just in case the government decide to cut his Social Security payment. He still have is IRA, 401k, AND his saving accounts (the government can't touch his saving accounts).

Plus we need the money (Cash liquids) in our savings just in case for Medical bills in our old age, nobody can remain stay a perfect health in their old age.
At this time there is Medicare for the elderly. You both have paid into Medicare and will continue to pay as long as you work. When you retire, you will get:

Medicare A for free. That’s hospital insurance. It covers most costs if you are in a hospital.

Then you sign up for Medicare Part B. That’s about $134 a month right now. It has something like a $180 a year deductible and then copays.

You can buy a Medicare supplemental policy. I have one that covers my Medicare deductible, all co-pays and things that Medicare does not pay. That’s about $130 a month.

Then you also get Medicare Part D – that’s drug insurance. Mine is under $30 a month. And I have to pay co-pays on the drugs.

Quote:
Originally Posted by jasmine31 View Post
We at the age (32 and 31), we don't have medical expense right now, but for sure when we old hit our retirement age we going to need those cash, because Health insurance can't pay 100% fully of every single medical expenses for us (and specially old age medical expense too), and we all know old age people when they get sick it can be very very expensive.
You can really cut down your out of pocket expenses… see by response above about Medicaid.

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Originally Posted by jasmine31 View Post
I want to make this clear. No, we not depending on Social Security payment. Ofcourse not. That is why we saving up as much 'cash liquids' as we can in our Savings accounts.. My husband do have a six-figures in his Saving accounts. In addition to a six-figures in his Retirement savings (his 401k/IRA). He is doing fine by himself alone with his income.

The thing is I hope he get 'some' of the Social Security tax that he been paying to the government all his life, at least get some back when he at old age. This is his hard working money, it the government that deduct it own of his weekly paychecks.

Personally, I find it not fair if the government decide to cut his Social Security payment when he old and retire, just because he has a six-figures in his Saving accounts, and a six-figures in his Retirement savings (his 401k/IRA).. It his hard work money that he work for, and he work a dangerous job too (day to day dealing Fuel which is highly flammable. Or Hydrofluoric Acid which is highly corrosive). Government deduct Social Security tax out of his weekly paychecks. I hope they at least give him 'some' back in his retirement old age. Arg! God damn it.
Someone has been telling you a lot of things that are not true.
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post #3 of 10 (permalink) Old 03-20-2017, 10:01 AM
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Re: Social Security tax that deduct out of husband weekly paychecks. And when he Reti

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The above is wrong. He is entitled to social security. His 401k & IRA savings will not impact what he gets from social security.


Wrong

There has been talk about Social Security not paying monthly benefits to the super wealthy, like people who earn millions a year. But that’s not how it works wright now. And I as it stands right now, you two do not earn millions a year.
Well, yes BUT - If you retire before 70 and have substantial non SS income you will have to give back $1 for every $2 you earn over a certain dollar threshhold, they are taking back some of the social security. Once you hit 70 that goes away but you get taxed on 85% of SS if I have it all straight.

There is also the actuarial problem the social security is only taking in enough to pay roughly 75% of the benefits 10-20 years or down the line. So it is somewhat likely you will collect 75% of the current benefit and have 15-39% of 85% of the remainder that taxed away.
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post #4 of 10 (permalink) Old 03-20-2017, 11:18 AM
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Re: Social Security tax that deduct out of husband weekly paychecks. And when he Reti

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Well, yes BUT - If you retire before 70 and have substantial non SS income you will have to give back $1 for every $2 you earn over a certain dollar threshhold, they are taking back some of the social security.
Full retirement age is between 66 and 67 depending on the year you were born, not 70.

https://www.ssa.gov/planners/retire/retirechart.html

If you are under*full retirement age*for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit.

For 2017*that limit is*$16,920.

In the year you reach*full retirement age, we deduct $1 in benefits for every $3 you earn above a different limit, but we only count earnings before the month you reach your full retirement age.

If you will reach full retirement age in 2017, the limit on your earnings for the*months before full retirement age is*$44,880.

Starting with the month you reach full retirement age, you can get your benefits with no limit on your earnings.

https://faq.ssa.gov/link/portal/3401...ement-benefits

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Once you hit 70 that goes away but you get taxed on 85% of SS if I have it all straight.
No one pays federal income tax on more than 85 percent of his or her Social Security benefits based on Internal
Revenue Service (IRS) rules. If you:
• file a federal tax return as an "individual" and your combined income* is
o between $25,000 and $34,000, you may have to pay income tax on up to 50 percent of your benefits.

o more than $34,000, up to 85 percent of your benefits may be taxable.
• file a joint return, and you and your spouse have a combined income* that is
o between $32,000 and $44,000, you may have to pay income tax on up to 50 percent of your benefits
o more than $44,000, up to 85 percent of your benefits may be taxable.
https://www.ssa.gov/planners/taxes.html

Quote:
Originally Posted by anonmd View Post
There is also the actuarial problem the social security is only taking in enough to pay roughly 75% of the benefits 10-20 years or down the line. So it is somewhat likely you will collect 75% of the current benefit and have 15-39% of 85% of the remainder that taxed away.
I'm answering for what it is today. We have no idea what will be done in the future. The reason that there is not enough in the SS fund is that the crooks in Congress (both parties) took the money and blew it on their pet projects instead of investing it, and saving it, like they were supposed to.

Last edited by EleGirl; 03-20-2017 at 11:27 AM.
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post #5 of 10 (permalink) Old 03-20-2017, 11:53 AM
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Re: Social Security tax that deduct out of husband weekly paychecks. And when he Reti

Thanks for clarifying the facts .

That is very generous of our government to let us get at least 15% of our social security 'tax free'.

My point remains, if your income is high you will pay tax on 85% of your social security. Since they've been extracting 12.4% of my income my entire working life (I count both my payment and the 'employer payment') taxing you again to me is taking away a benefit.

As for your last point, sure they spent it on something else over the years. What they spent was replaced by US Treasuries, it is only after those Treasuries are redeemed that the benefit cut needs to be implemented.
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post #6 of 10 (permalink) Old 03-20-2017, 03:20 PM
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Re: Social Security tax that deduct out of husband weekly paychecks. And when he Reti

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Thanks for clarifying the facts .

That is very generous of our government to let us get at least 15% of our social security 'tax free'.

My point remains, if your income is high you will pay tax on 85% of your social security. Since they've been extracting 12.4% of my income my entire working life (I count both my payment and the 'employer payment') taxing you again to me is taking away a benefit.
Yes a person will pay taxes on up to 85% of their SS based on their income level. I don't have a problem with that. Though, since I now get SS, I would of course prefer to pay no taxes. Who wants to pay taxes?

The average SS payment is $1,500.46 for men and $1,182.36 for women. For most people getting SS, it's all that they have as income. So the majority pay no income taxes at all.

https://www.fool.com/retirement/2016...-at-age-6.aspx


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As for your last point, sure they spent it on something else over the years. What they spent was replaced by US Treasuries, it is only after those Treasuries are redeemed that the benefit cut needs to be implemented.
My point was that had they invested the money that we all put in, the fund would have so much money that it would never run dry. Just giving by the amount put in makes no sense. IMO, our gov should be responsible to handle our money wisely. SS is our money.
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post #7 of 10 (permalink) Old 03-20-2017, 03:35 PM
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Re: Social Security tax that deduct out of husband weekly paychecks. And when he Reti

The treasuries paid interest which was credited to the fund, now it is being rapidly spent down. Fact.
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post #8 of 10 (permalink) Old 03-20-2017, 06:04 PM
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Re: Social Security tax that deduct out of husband weekly paychecks. And when he Reti

He gets the social security and retirement plan separately.

There is of course no knowing how laws might change in the future, but there are many other people in the same situation so I expect elected politicians will not make changes that will lose them a lot of votes.

The biggest risk to his retirement is probably not changes in how social security and retirement are treated, but large scale financial risks - economic collapse, run-away inflation etc. Those are risks that everyone in the country shares.

We have always been very conservative and spread our money out including some in foreign funds and some in physical gold. Other people manage their money in different ways, there is no single right answer.
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post #9 of 10 (permalink) Old 03-20-2017, 06:26 PM
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Re: Social Security tax that deduct out of husband weekly paychecks. And when he Reti

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Yes a person will pay taxes on up to 85% of their SS based on their income level. I don't have a problem with that. Though, since I now get SS, I would of course prefer to pay no taxes. Who wants to pay taxes?

The average SS payment is $1,500.46 for men and $1,182.36 for women. For most people getting SS, it's all that they have as income. So the majority pay no income taxes at all.

https://www.fool.com/retirement/2016...-at-age-6.aspx




My point was that had they invested the money that we all put in, the fund would have so much money that it would never run dry. Just giving by the amount put in makes no sense. IMO, our gov should be responsible to handle our money wisely. SS is our money.
Actually that is not correct. The amount of investing needed to pay promised benefits indefinitely would have forced them to buy up all the big companies in the US. Would it really be an improvement to have the government do that?

And of course, expecting the government to be careful with our money is like expecting a teenager to drive responsibly when drunk.

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post #10 of 10 (permalink) Old 03-20-2017, 06:27 PM
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Re: Social Security tax that deduct out of husband weekly paychecks. And when he Reti

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The treasuries paid interest which was credited to the fund, now it is being rapidly spent down. Fact.
Those "special non-marketable Treasurys" have the same value as an IOU that you write to yourself, because that's what they are, for the value of "yourself" = the federal government.


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