@shawbridge That’s how I read it. The thing I am confused is, isn’t a revocable living trust becomes irrevocable once the grantor passes? And the assets left in the trust would be in an irrevocable trust?
I don’t know about that. It probably depends upon where you retirement funds stem from. If you depend upon just Medicare and Social Security, not so good…unless they make it income dependent, and then it might not affect lower income people.
But if you have significant investments in the market, they could increase greatly as companies buyback their stocks, increase dividends and the stock market goes up. If you have an underfunded pension plan, it could be made stronger by a greater return in investments.
This plan solidifies my opinion. Those who are in the market and own real estate are going to be prospering. Those who aren’t, are going to watch as others net worth increases and theirs stays stagnant, with the cost of living increasing.
@busdriver11, I agree that the effect of the cheap pass to bring the foreign $$ back to the US and the tax cut are share buybacks, but I suspect the business cycle is mostly done. So, what we’ll see is a short-term, artificial bump as opposed to growth in the economy. Unemployment is already low. I’m not making hiring decisions because my tax rate is 7.4% lower (could affect investment decisions). I have been thinking that when RE prices adjust, RE will be a good investment.
My concern is that Medicare is the next thing on the chopping block. Paul Ryan will discover the deficit again and hyperventilate about entitlements and his plan is to cut Medicare. I think people planning on Medicare to cover health care may well have to divert other resources.
I agree with @shawbridge about Medicare, and if I understand the RE comment, about the depressive effect on RE prices, at least on the coasts where SALT will be capped. Also agree about the short term artificial bump.
I never really counted on SS, but I had perhaps foolishly planned on Medicare covering me after age 65.
Does anyone know if there will be a change to the step-up basis of a home upon death? No trust, and estate does not trigger estate taxes, but home has appreciated significantly in value since purchase.
One doesn’t know what plans to cut Medicare entail. It may be cost adjustments based on income. I don’t disagree with that, if it’s otherwise unsustainable. Details would be helpful.
Probably the most conservative way to make retirement financial planning is to assume that Medicare and Social Security are eliminated and that private individual medical insurance will not be available (pre-existing conditions if ACA is repealed, lack of offerings if ACA is retained). This means that the amount of retirement savings must include enough to self-pay any medical expenses, as well as provide for living expenses without any Social Security money.
Might be easier to just prepay a funeral. [/sarcasm]
Uh, yeah. I have cost my insurance almost $200k this year and I’m not done yet.
@ucbalumnus, no Medicare, no medical insurance, and no Social Security would be a pretty cruel world for the bottom 80% of the income distribution. But, it would return us to the 50s, I guess, except we now have very high medical costs. I wonder how far we have to go in that direction before the “populist” base turns against the low taxes on the rich/cut the social safety net Republicans (Ryan, Cruz, etc.). Judging from Sam Brownback’s debacle in Kansas, it looks like one has to go pretty far. As Trump would say, Sad!
Incidentally, here’s a calculator on the distribution of changes in tax for many folks. https://www.nytimes.com/interactive/2017/12/17/upshot/tax-calculator.html?em_pos=small&emc=edit_up_20171218&nl=upshot&nl_art=0&nlid=71558830&ref=headline&te=1.
“But, it would return us to the 50s, I guess, except we now have very high medical costs.”
And no pensions!
@doschicos, correct.
Given the trend toward an economy that looks like that of a stereotype of a Latin American country, or Russia outside the USSR era, and government budgets that cannot sustain Medicare snd Social Security, that is probably the future reality. The Dems do not seem to be able to stop that trend (despite occasionally trying to slow it), and the GOP apparently wants to accelerate that trend.
" like that of a stereotype of a Latin American country"
The irony is many Latin American countries do have decent universal healthcare.
Unfortunately, insurance companies, drug companies, lawyers, and even doctors themselves, have turned the health care system into such an out of control monster that nationalization may be the only way to return it to rationality.
Unfortunately this also quite likely means the highest, best standard of care will not be in the cards for most people. Rationing and tough decisions will have to be made that many people won’t like, especially when it directly affects you and your loved ones.
80 years old and you get cancer? Sorry, you don’t get half a million in aggressive chemo to extend your life a few painful months. We’ll make you comfortable though.
Knee replacement on a 75 year old? Eh, maybe not.
Liver destroyed by alcohol abuse? No transplant for you.
Million dollar heroic care of a 5 month preemie? Maybe not.
World class cardiac surgeon who was making a million+ per year? Not any more.
$90,000 for a hep C treatment because that’s a little less than what the current marginal treatment costs, even though it costs 1% of that to make? Sorry drug company.
x 1,000,000
Health care now comprises around 18% of GDP. Either you “tax” every single thing in the economy 18% to pay for it (and that still leaves a large chunk of people without care), or you do something drastic to wring the cost out. And the health care industry won’t do it voluntarily.
The people will vote it for themselves eventually though, especially if Medicare gets cratered. Old people vote.
Even some simple things to start to get under control will never happen in the current environment, like allowing Medicare to negotiate drug prices or requiring health care providers to have full price transparency of everything so consumers can price-shop or requiring hospitals to charge uninsured people no more than the median of what an insurance plan would reimburse so a health crisis doesn’t instantly bankrupt you if you don’t have insurance.
I think you’re all being draconian.
BEsides, no Medicare and no Social Security wouldn’t take us back to the '50s; it would take us back to the '20s. SS was passed in 1935.
Seniors are too big of a voting public to have Medicare and SS eliminated. May have higher cost with M/C. SS is really flat - MIL got a $4/month increase for next year.
Prepare for the worst but hope for the best.
Thankfully we had good insurance during my battle with aggressive stage III cancer, and I got excellent care. Many places on our globe, I would not be here today.
Next time your doctor orders a test, procedure or medicine, ask him/her how much it costs. Odds are they won’t know. How many other products/services are sold/delivered with neither the buyer nor the seller knowing the cost?
"Unfortunately this also quite likely means the highest, best standard of care will not be in the cards for most people. "
That already true for many, many people in this country. If you’re not working for the government or a generous employer with a decent plan, your insurance is pretty limited and restricted these days.
I agree that the lack of transparency in pricing is an issue.
I agree, most folks don’t or would not bother to find out. I know precisely both list and negotiated price for most garden variety stuff like CT, MRI, blood work, etc. as I use one hospital system and I also review each bill carefully. I refused anesthesia for one procedure yet my insurance was billed for it. No, it was not a sunk cost. I called the hospital and they were, “oops, we forgot to take it off.” $1200. How many folks would bother doing this?