What If….?

Income taxes were increased to 70% or more? This may be more of a reality than some people think. Many young people have only lived under relatively low tax rates, but some of us remember the burden of high progressive tax rates. [see chart here:]


Would you know how this would impact your retirement cashflow?

Will your money last as long as you do if inflation went into double digits, or God-forbid worse? Google Argentina’s inflation history ~ You’d think we would learn from other countries’ mistakes, but we’re following them right into hyper-inflation (they’ve recovered, but not without great damage to the middle class).

It appears that we are not going to see smaller government, perhaps for a long, long time, if ever again. If I were a betting man (gal), my money says income taxes go up. [Go back and look at that historical income tax chart again!] Our lawmakers are word game masters, and when raising taxes isn’t politically expedient, regulatory fees are often applied to just about everything in your fixed budget items. I.e. ever wondered about those “State Regulatory, PUC, Fed Universal Service, Local Video Franchise Service fees, and the long list of surcharges & fees on your cell phone bill??? The long-reaching arm of government regulation escapes most consumers’ attention. We are all too busy in our daily lives to notice these insidious changes.

When you add inflation to any tax increase, that further compounds the loss of your dollar’s purchasing power! There are many rumors circulating around the $800 billion Economic Stimulus Bill of 2008 and the Reauthorization of the Patriot Act, regarding stealth provisions that may allow the Feds to confiscate more of your money. I have attempted to read through the fine print of that one stimulus bill & concluded that it intends to confuse and confound the reader. No wonder many of our lawmakers haven’t even read this through! Suffice it to say, that we can only do our best, under the current circumstances, anticipating what we believe may happen, based on today’s laws and taxes, when we put plans together for retirement.

I don’t mean to cast a dark cloud of doom over our future. Rather, my humble wisdom is to encourage you to do some work, put a plan together and revisit it at least annually to adjust for changes. I am here to help ~ To your financial health & wealth!