401k savings limit to increase in 2023

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I can't believe how bitter they are that some poor people are getting a larger proportional "payback" from Social Security. The vast, vast, VAST majority of these people aren't even people who can possibly put away the 401k savings limit, so the "advantage" they have over you is purely theoretical, and I'm reasonably sure you wouldn't trade for the lifestyle of someone whose primary income in retirement is from SS. (I have an HHI of $160k and day care bills, and I'm not sure we will be able to afford to max out with these new limits, so I know people making much less would have a very hard time with it, and the statistics on US retirement savings are pretty dismal.)

If you're upset that if someone with much less than you is getting a proportional tax break you're not, I suggest rolling around in your much larger absolute quantity of money to feel better.

The payback from SS is proportional to what you paid in. However, most people who scream about the limit on collecting SS from people don't seem to realize that and that there is a cap on what you get paid back which is proportional to what you paid in

This is BS. My mother worked in an administrative type job in the 70's for only a few years until she quit for good at age 30 when she had me. She's now collecting $1300 a month in SS, far exceeding what she ever paid into it.

So, are you arguing that your mom should be eating cat food and living on the street?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

+ 1. PP should quit their jobs and work at Mcdonald's so they can pay even less than the Household 2! Show them!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

+ 1. PP should quit their jobs and work at Mcdonald's so they can pay even less than the Household 2! Show them!

Then she can be the luckiest.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

I mean I am all for lower income taxes..or at least tax rates based off of higher cost of living areas. 400k in DC is vastly different than 400k in Omaha. In Omaha, they live like kings. In DC, for a family of 5, they are solidly living a "middle class" existence.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

I mean I am all for lower income taxes..or at least tax rates based off of higher cost of living areas. 400k in DC is vastly different than 400k in Omaha. In Omaha, they live like kings. In DC, for a family of 5, they are solidly living a "middle class" existence.

No, they aren’t living a middle class existence. You have a perverted understanding of a middle class existence.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

Really? I'd rather have twice as much money even if I couldn't put away as high a proportion in taxed advantaged accounts....wouldn't you?

Yes, but nothing prevents someone from making twice as much money. It is a personal choice. Get a second job. Become a physician instead of a teacher. Become an engineer instead of an bus driver. If you don’t have the skills, get them. Reading books is free. Financial Aid is available for those in need. You get the idea.

On the other hand, when it comes to tax-advantaged savings, there are very limited personal choices. There are literally laws that prevent high income individuals from saving the same percentage of their income pre-tax as their lower income counterparts. This is on top of a progressive tax bracketing structure and on top of many tax deductions that phase out with income and on top of many tax credits that phase out with income.

A person with an HHI of $500K paying taxes on 80% of their income is still paying taxes on $400K as compared to someone with an HHI of $160K who ends up paying taxes on only $128K. The high income individual is still paying a lot more in taxes, despite the more equitable savings structure. Do we really need to keep piling on countless nonlinear penalties for earned income?!? No one is calling for anything as radical as a flat income tax here.

This is such a rude post. I’m a teacher with a Master’s degree and 2 kids. I already coach and sponsors as many after school activities as I can and still barely making ends meet. When exactly would I work a second job? Just the childcare funds alone would eat up the income.

Here’s a novel concept: stop trying to live a physician’s lifestyle on a teacher’s salary!

I think you're in the wrong thread, this one is about the physicians whining that the teacher gets to put a higher % of her income in a 401k. Even though they both can put in the exact same dollar amount - literally, the "problem" is that they have more money than the teacher.

No, this is typical cherry picking of rules for taxation. When it comes to taking taxes, it is done as a percentage of income (and progressively at that)…but, when it comes to proving a tax-sheltered deduction, it is implemented as a fixed dollar amount. This is illogical, as it nonlinearly benefits those in lower income brackets, thereby incentivizing people to remain in low income tax brackets. Is this all some sort of extravagant ploy to reward low-paying careers that provide inherent public benefit? If so, maybe this is somewhat sensible after all. If it is just a welfare system, however, it really needs to be eliminated and overhauled with a better plan.

Physicians can own practices which allows a myriad of deductions that a teacher will never see. A doctor paying high taxes is doing so by choice or because they are too cheap to get a good accountant

[Anonymous]

Anonymous wrote:

Anonymous[b wrote:]The IRS is increasing the limits for 401k, 403b, etc up to $22,500 next year and the IRA limit is increasing from $6,000 to $6,500. Good news for those who want to save more pre-tax next year.[/b]

https://apnews.com/article/government-and-politics-business-441920f23fee68afd8a389470ab28013

hmmmm. And to think what I've lost in those accounts in the last few months . . .

There is a benefit to long term investing outside of tax-deferred/advantaged accounts: tax loss harvesting, no RMD's, control over incurring cap gains etc. Tax diversification is a good thing. Rather than worrying about a few thousand a year in tax advantaged space, just VTSAX (or VTI) and chill in a regular brokerage account.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

So high income people should get even more tax benefits? You’re looking at this as percentages (20% of income) but in dollar terms it looks really disproportionate and unfair.

— signed, I’m in your > $145k group

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous[b wrote:]The IRS is increasing the limits for 401k, 403b, etc up to $22,500 next year and the IRA limit is increasing from $6,000 to $6,500. Good news for those who want to save more pre-tax next year.[/b]

https://apnews.com/article/government-and-politics-business-441920f23fee68afd8a389470ab28013

hmmmm. And to think what I've lost in those accounts in the last few months . . .

There is a benefit to long term investing outside of tax-deferred/advantaged accounts: tax loss harvesting, no RMD's, control over incurring cap gains etc. Tax diversification is a good thing. Rather than worrying about a few thousand a year in tax advantaged space, just VTSAX (or VTI) and chill in a regular brokerage account.

Also everything that comes out of a 401k is taxed at ordinary income rates, vs capital gains if you save outside those accounts.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

I mean I am all for lower income taxes..or at least tax rates based off of higher cost of living areas. 400k in DC is vastly different than 400k in Omaha. In Omaha, they live like kings. In DC, for a family of 5, they are solidly living a "middle class" existence.

So move to Omaha. It’s just not true that a family in D.C. lives a middle class existence on a $400k salary. For one thing, they spent huge amounts of money every month on a luxury item, i.e., housing in the D.C. area. You wouldn’t say people deserve special treatment if they spent $50,000 a year on, say, expensive cigars, why should our expensive houses be any different?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

I mean I am all for lower income taxes..or at least tax rates based off of higher cost of living areas. 400k in DC is vastly different than 400k in Omaha. In Omaha, they live like kings. In DC, for a family of 5, they are solidly living a "middle class" existence.

So move to Omaha. It’s just not true that a family in D.C. lives a middle class existence on a $400k salary. For one thing, they spent huge amounts of money every month on a luxury item, i.e., housing in the D.C. area. You wouldn’t say people deserve special treatment if they spent $50,000 a year on, say, expensive cigars, why should our expensive houses be any different?

Cities are naturally more expensive and provide the largest revenue for the Fed & States. FHA limits are changed based upon cost of living. How can the fed say that all people over 400k are "rich" when that's such a ridiculous blanket statement. I wouldn't make 400k in Omaha because there is simply no industry to support the high incomes we get in DC,NY,SF, Boston. A 400k income is Omaha is comparable to 717k in DC (per https://www.nerdwallet.com/cost-of-living-calculator/compare/omaha-ne-vs-washington-arlington-alexandria-dc-va)

Bump up the federal thresholds in HCOL areas and you'll get more people supporting tax increases. 717k in DC is a MUCH different lifestyle than 400k. I'm sick of subsidizing the south and midwest.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

I mean I am all for lower income taxes..or at least tax rates based off of higher cost of living areas. 400k in DC is vastly different than 400k in Omaha. In Omaha, they live like kings. In DC, for a family of 5, they are solidly living a "middle class" existence.

This is really out of touch.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

I mean I am all for lower income taxes..or at least tax rates based off of higher cost of living areas. 400k in DC is vastly different than 400k in Omaha. In Omaha, they live like kings. In DC, for a family of 5, they are solidly living a "middle class" existence.

This is really out of touch.

No it's not. Avg single family home sale price in DC proper was just over 1M. With rates today, a mortgage on a 1M home (again, average..aka middle class) with 20% down, and you're looking at 5,500 - 6,000/mo easily. If you have three kids, 400k/yr won't get you many luxurious with a 6k + mortgage.

If you net 60% of your salary you're spending roughly 1/3 of your take home pay just on your mortgage. Sure you're not eating ramen, but you aren't driving around fancy cars and fancy international trips like the politicians think you are.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Most people cannot afford to do this

The people who cannot afford to do this don’t really need to save this much. Median HHI is around $78K and everyone knows that 20% of income needs to be set aside for retirement savings. That’s only $15,600 needed per year, so no need to save more by traditional standards.

The real concern is for those families that make more than $145K per year. The $29K allowance between 401k and IRA contributions isn’t really enough for these people. Congress should change the rules so that pre-tax contribution limits vary as a percentage of HHI so that everyone is permitted to save 20% of their income for retirement. This is especially true for high HHI families since social security replaces a lesser percentage of income as income increases. DH and I both work, but the $58K allowance between our collective retirement plans isn’t even 10% of our HHI. And we don’t even get a tax break on the IRA contributions anyway. So illogical and unfair. LMC and MC families don’t know how lucky they are!

You are really disgusting

You seem to be confused regarding the way taxes work. Perhaps an explanation with more numbers?

Household #1: MFJ couple with taxable income of $647,851 has a federal tax liability of $174,253 and an effective tax rate of 26.9%.

Household #2: MFJ family of five with taxable income of $178,151 has a federal tax liability of $30,427 and an effective tax rate of only 17.1%.

These are the actual tax liabilities for 2022. Clearly, Household #2 is the more disgusting of the two, refusing to pay their fair share.

Even worse, we have two people in Household #1 that are paying $87,126.50 EACH into the federal government, yet five people in Household #2 paying only $6,085.40 EACH into the same federal government. Few things are more patently egregious than a person that stands by and watches another person be forced to pay 14X as much to receive the same benefits and services.

So, by your reasoning...make less money?

I mean I am all for lower income taxes..or at least tax rates based off of higher cost of living areas. 400k in DC is vastly different than 400k in Omaha. In Omaha, they live like kings. In DC, for a family of 5, they are solidly living a "middle class" existence.

This is really out of touch.

No it's not. Avg single family home sale price in DC proper was just over 1M. With rates today, a mortgage on a 1M home (again, average..aka middle class) with 20% down, and you're looking at 5,500 - 6,000/mo easily. If you have three kids, 400k/yr won't get you many luxurious with a 6k + mortgage.

If you net 60% of your salary you're spending roughly 1/3 of your take home pay just on your mortgage. Sure you're not eating ramen, but you aren't driving around fancy cars and fancy international trips like the politicians think you are.

I think what you're missing is that an actual middle class family with 3 kids who doesn't already own property simply doesn't have the option of a single family home in DC. It's a different scale of "basics" than someone making $150k, who's most likely looking outside DC and has to deal with the commute, or maybe able to find a rowhome east of the Anacostia, where the $400k family is unlikely to buy. The vast, vast majority of my friends with HHIs under $200k live across Maryland.