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