Middle Class Tax Trap?

[NICE!]

Look, I love ad hominems and straw men as much as the next guy, but I appreciate well reasoned and well supported posts more.

You addressed neither 1, nor 2, nor 3. You're completely disregarding the circumstances surrounding this previous era that happened to have a set of tax rates that suit your preferred ideology. Not only does it have zero to do with today's world, it is 100% out of the question from a policy standpoint, so why is it even in discussion?

[Norioch]

Very interesting editorial about the middle class and taxes:
http://www.slate.com/articles/news_and_politics/politics/2015/01/the_upper_middle_class_is_ruining_all_that_is_great_about_america.html

The author's claim is that the upper middle class is hurting America by demanding higher taxes from the super rich but vehemently opposing any higher taxes for themselves, or any sacrifice for themselves of any sort. The author self-identifies as conservative, and I don't, but I agree with a lot of what's in the article. Our budget problems are never going to be solved if voters are not willing to make personal sacrifices for the good of the country.

The author defines the upper middle class as "families that earn well into the six-figure range yet don’t feel rich". I don't really qualify, since I make six figures and do feel rich, and as I've already stated in this thread, I don't feel middle class. But, as a member of whatever class I'm in, I have a plea for any politicians reading this: please raise our taxes. Please collect more in taxes from people like me who are drowning in disposable income. You won't lose my vote if you promise to raise my taxes. You might earn it.

[MoneyCat]

I advocate raising the tax rate on rich people, because I want their money so I think I should take it from them.  That would be the easiest way to get it.

[dragoncar]

I advocate raising the tax rate on rich people, because I want their money so I think I should take it from them.  That would be the easiest way to get it.

Seconded.  All in favor?  Meow

[Abe]

I favor raising taxes on poor people because they can't afford lawyers. That's probably easier than taxing rich people because of aforementioned lawyers.

[RFAAOATB]

I favor raising taxes on poor people because they can't afford lawyers. That's probably easier than taxing rich people because of aforementioned lawyers.

But if they are taxed too much, they can't pay on account of being poor and become tax cheat criminals.  Plus they out breed the rich leading to more and more poor people.  Lets sterilize the poor so that we can finally win the war on poverty when they die out.

[MidWestLove]

I am a little confused - what is the argument about?  Also, why all the BS about handpicked years to prove our taxes now are low, really low *drum roll*. why 1945 and not say 1935 (63% top rate), why 1935 and not 1925 (25% highest income tax rate), why 1925 and not 1915 (<15% highest tax rate while WWI is going on which US will enter in few years) ?  Why such selective memory?

personally, I would trust government spending as percentage of GDP much more than made up comparisons with made up years. and trend is (without any exceptions known to them)  that higher government spending => misery , always.

signed, ex Soviet Union immigrant , lived there, breathed  the 'free' medicine/education/zero unemployment fantasies that "rich" (anyone not you) should pay for. never works, not a single example.

[JLee]

As someone who makes less than 60k, I find this thread incredibly amusing.

If any of you 200k earners want to trade, let me know. :)

[CanuckExpat]

I am a little confused - what is the argument about?

What ever its about, it long ago stopped being about the OPs question or helping him/her with their situation. I think now it's about this:

[MidWestLove]

thanks :), liked the illustration. checking out for the next 5 pages at least (if thread makes that far).

[MoneyCat]

I favor raising taxes on poor people because they can't afford lawyers. That's probably easier than taxing rich people because of aforementioned lawyers.

But if they are taxed too much, they can't pay on account of being poor and become tax cheat criminals.  Plus they out breed the rich leading to more and more poor people.  Lets sterilize the poor so that we can finally win the war on poverty when they die out.

Besides, poor people don't have any money to tax.  Maybe we could find a way for them to pay taxes in folk art made from old beer cans.

[Sid888]

Hate to break it to you, but that's not middle class. That's top 10 %.

Defining the middle class in the US is becoming problematic.  If you do it solely on income it doesn't count for retirement and other critical savings needed in the "ownership" society.  Defining middle class solely on an "income" basis worked a lot better when we all had pensions but that's simply not the case anymore. 

Case in point would you rather be a retired 55 year old cop with a $70K annual pension or a 55 year old accountant making  $125K a year with $400K in a 401K?  I think most would say that the cop is doing better financially although the government would say the cop is middle class and the accountant is upper class looking at solely their annual incomes.

Middle class income and total wealth should also be defined regionally so as to take into account cost of living differences.

I think a fair definition of middle class is whether you still need to earn wages from labor.  I think once a person has started being able to live off of investment income (passive income), then they start to transition out of thye middle class and into the upper class.

[starguru]

Hate to break it to you, but that's not middle class. That's top 10 %.

Defining the middle class in the US is becoming problematic.  If you do it solely on income it doesn't count for retirement and other critical savings needed in the "ownership" society.  Defining middle class solely on an "income" basis worked a lot better when we all had pensions but that's simply not the case anymore. 

Case in point would you rather be a retired 55 year old cop with a $70K annual pension or a 55 year old accountant making  $125K a year with $400K in a 401K?  I think most would say that the cop is doing better financially although the government would say the cop is middle class and the accountant is upper class looking at solely their annual incomes.

Middle class income and total wealth should also be defined regionally so as to take into account cost of living differences.

I think a fair definition of middle class is whether you still need to earn wages from labor.  I think once a person has started being able to live off of investment income (passive income), then they start to transition out of thye middle class and into the upper class.

Such a good point, and well said too.  Income is just one part of the financial picture.  Someone wrote earlier about HENRYS ( high earners not yet rich), which applies to this idea.  When u consider the entire picture it seems to me at least the notion of singling out just the high earners seems arbitrarily selective.  So what's the answer?  A wealth tax?  How many people here who support taxing "the rich" support taxing wealth?  What if it's their wealth? 

[Janie]

The idea that "we all had pensions" is pretty much a myth. http://m.kiplinger.com/article/retirement/T047-C000-S002-the-new-realities-of-retirement.html

Don't blame the boomers' underfunded retirement predicament solely on disappearing pensions. The golden age of the gold watch is largely a myth. A recent Investment Company Institute report noted that although 90% of private-sector workers who had access to a retirement plan in 1975 were covered by a traditional pension, only 20% of them ever received any income from those plans. Back then, more-stringent vesting rules prevented many workers with fewer than ten years on the job from qualifying for any pension benefits, and the biggest checks were reserved for those who stuck with one employer for 20 years or more. In reality, few did.

[Sid888]

The idea that "we all had pensions" is pretty much a myth. http://m.kiplinger.com/article/retirement/T047-C000-S002-the-new-realities-of-retirement.html

Don't blame the boomers' underfunded retirement predicament solely on disappearing pensions. The golden age of the gold watch is largely a myth. A recent Investment Company Institute report noted that although 90% of private-sector workers who had access to a retirement plan in 1975 were covered by a traditional pension, only 20% of them ever received any income from those plans. Back then, more-stringent vesting rules prevented many workers with fewer than ten years on the job from qualifying for any pension benefits, and the biggest checks were reserved for those who stuck with one employer for 20 years or more. In reality, few did.

I agree that boomers are a part of the "ownership" society - they just realized it way, way too late.  In their defense, the boomers parents were the "pension" generation and the boomers continued their parents spending without regard for their own retirement security.  If you - or Kiplinger's - looked at 1955 and 1965 the percentage of workers receiving traditional pensions would be a lot higher than 20% for the "greatest generation" or whatever you want to call pre-boomers.

[Sid888]

Hate to break it to you, but that's not middle class. That's top 10 %.

Defining the middle class in the US is becoming problematic.  If you do it solely on income it doesn't count for retirement and other critical savings needed in the "ownership" society.  Defining middle class solely on an "income" basis worked a lot better when we all had pensions but that's simply not the case anymore. 

Case in point would you rather be a retired 55 year old cop with a $70K annual pension or a 55 year old accountant making  $125K a year with $400K in a 401K?  I think most would say that the cop is doing better financially although the government would say the cop is middle class and the accountant is upper class looking at solely their annual incomes.

Middle class income and total wealth should also be defined regionally so as to take into account cost of living differences.

I think a fair definition of middle class is whether you still need to earn wages from labor.  I think once a person has started being able to live off of investment income (passive income), then they start to transition out of thye middle class and into the upper class.

Such a good point, and well said too.  Income is just one part of the financial picture.  Someone wrote earlier about HENRYS ( high earners not yet rich), which applies to this idea.  When u consider the entire picture it seems to me at least the notion of singling out just the high earners seems arbitrarily selective.  So what's the answer?  A wealth tax?  How many people here who support taxing "the rich" support taxing wealth?  What if it's their wealth?

Thanks for pointing out the HENRY group.  I bet they exist in droves in large cities.

http://archive.fortune.com/2008/10/24/magazines/fortune/tully_henrys.fortune/index.htm

http://www.marketplace.org/topics/economy/keeping-henrys

[Tabaxus]

Hate to break it to you, but that's not middle class. That's top 10 %.

Defining the middle class in the US is becoming problematic.  If you do it solely on income it doesn't count for retirement and other critical savings needed in the "ownership" society.  Defining middle class solely on an "income" basis worked a lot better when we all had pensions but that's simply not the case anymore. 

Case in point would you rather be a retired 55 year old cop with a $70K annual pension or a 55 year old accountant making  $125K a year with $400K in a 401K?  I think most would say that the cop is doing better financially although the government would say the cop is middle class and the accountant is upper class looking at solely their annual incomes.

Middle class income and total wealth should also be defined regionally so as to take into account cost of living differences.

I think a fair definition of middle class is whether you still need to earn wages from labor.  I think once a person has started being able to live off of investment income (passive income), then they start to transition out of thye middle class and into the upper class.

This kind of ignores that the pension for the cop was effectively forced savings.  Of course the cop is in a better place, because the accountant (apparently) failed to save much during his or her  working career.  If you equalize the pension contributions, you can get a better sense of what the cop's real wages were over time.  Unfortunately, the tax code doesn't treat this stuff in an economically appropriate matter--pension contributions should have the same cap on tax deferral as do 401(k)s (or vice versa).

I do believe that it can be appropriate to think of middle/upper class as accounting for COL differences, and there are certainly some places where low six figures could conceivably be upper-middle class (and mid/high 5 figures could be mid/lower middle class). 

But this idea that, in order to "start to transition" out of the middle class, you need to be in a position where you never need to work again?  That is ridiculous, on both sides:  it implies that someone is upper class if they have very modest passive income but low enough spending to live on that passive income (e.g., $15k/year ERE types), and it implies that someone making $500k a year might not be upper class if they're a spendthrift and blow all of their cash.  Income is an imperfect substitute, but it gets rid of a lot of the noise.

[starguru]

But this idea that, in order to "start to transition" out of the middle class, you need to be in a position where you never need to work again?  That is ridiculous, on both sides:  it implies that someone is upper class if they have very modest passive income but low enough spending to live on that passive income (e.g., $15k/year ERE types), and it implies that someone making $500k a year might not be upper class if they're a spendthrift and blow all of their cash.  Income is an imperfect substitute, but it gets rid of a lot of the noise.

Are you sure?  The living off 15k type has ~400k in the bank.  They are rich compared to almost everyone on earth, and even most of the US populate, who is too busy buying useless crap to save any significant funds at all.

One can make 500k a year and still be poor.  Buy a few homes, a boat, a few fancy cars they can easily have negative NW.  They are not rich (and yes, the person in this example is an idiot), but they are a high earner.

The whole point is the "tax the rich" mantra is flawed because all it really means in Obama-speak is high earners.  Its demagoguery.  It's speaking nonsense that appeals to people who hear "it's someone else's responsibility". 

[Janie]

Info on private pension plans 1950-74 http://socialsecurity.gov/policy/docs/ssb/v39n6/v39n6p3.pdf

[Sid888]

Hate to break it to you, but that's not middle class. That's top 10 %.

Defining the middle class in the US is becoming problematic.  If you do it solely on income it doesn't count for retirement and other critical savings needed in the "ownership" society.  Defining middle class solely on an "income" basis worked a lot better when we all had pensions but that's simply not the case anymore. 

Case in point would you rather be a retired 55 year old cop with a $70K annual pension or a 55 year old accountant making  $125K a year with $400K in a 401K?  I think most would say that the cop is doing better financially although the government would say the cop is middle class and the accountant is upper class looking at solely their annual incomes.

Middle class income and total wealth should also be defined regionally so as to take into account cost of living differences.

I think a fair definition of middle class is whether you still need to earn wages from labor.  I think once a person has started being able to live off of investment income (passive income), then they start to transition out of the middle class and into the upper class.

1.  This kind of ignores that the pension for the cop was effectively forced savings. 

2.  Of course the cop is in a better place, because the accountant (apparently) failed to save much during his or her  working career. 

1.  Forced savings would be a great way (like the Australian system) to make the ownership society retirement system work a whole lot better.

2.  The cop is in a better place because his or her employer (the taxpayers, in reality) will end up paying 80-90% of his or her pension costs until they and, most likely, their spouse passes away.  With regard to 401K savers, why do you say that saving $400K at 55 is a failure?  What if the accountant only started earning $125K a year 3 years ago and his employer does not have a retirement savings match?  If we expect humans to be perfect with regard to spending, earning, saving, investing and withdrawing, then the "ownership" society system will never, ever work for the vast majority of humans who have not accumulated enough wealth to get off the wage tread mill or who get sick, are uneducated, grow up poor or middle class, come from "pension" families so they either were nor taught to save or spend like they don't need to save, have bad role models for parents, have no parents, get laid off, don't follow good advice and start too late in life, etc. or simply make mistakes...

[Tabaxus]

But this idea that, in order to "start to transition" out of the middle class, you need to be in a position where you never need to work again?  That is ridiculous, on both sides:  it implies that someone is upper class if they have very modest passive income but low enough spending to live on that passive income (e.g., $15k/year ERE types), and it implies that someone making $500k a year might not be upper class if they're a spendthrift and blow all of their cash.  Income is an imperfect substitute, but it gets rid of a lot of the noise.

Are you sure?  The living off 15k type has ~400k in the bank.  They are rich compared to almost everyone on earth, and even most of the US populate, who is too busy buying useless crap to save any significant funds at all.

One can make 500k a year and still be poor.  Buy a few homes, a boat, a few fancy cars they can easily have negative NW.  They are not rich (and yes, the person in this example is an idiot), but they are a high earner.

The whole point is the "tax the rich" mantra is flawed because all it really means in Obama-speak is high earners.  Its demagoguery.  It's speaking nonsense that appeals to people who hear "it's someone else's responsibility".

I will acknowledge that tax policy debates would be on firmer ground if the debate was "tax high earners!" rather than "tax the rich!"  The recognition-event framework of taxation is designed around taxing income, not wealth.  And yes, the person who can afford to "buy a few homes, a boat, a few fancy cars" should be taxed at a significantly higher rate that the person who can afford to pay modest rent and food on their table.  The fact that a few people in the former group are idiots with their money isn't an indictment of progressive taxation.

Of course, I think we should tax wealth much more broadly at death (much broader and higher inheritance tax, get rid of the step up in basis, etc.), so it is what it is.  Despite being a relatively  high earner, I still believe very firmly in that pesky social contract that holds that we shouldn't be letting people starve in the streets or be deprived of solid public education or infrastructure.

Comparing the "retired with a $70k pension cop" and the accountant only works if you are equalizing salary over time.  Takes a lot of years on the job to have that vested pension, and the value of that pension should be "backed in" to the wages the cop received over his or her career to make a fair comparison to the accountant.  Obviously, if you turn the pension around and the cop had a much higher effective wage over his career than the accountant, it shouldn't be remotely surprising that the cop is in a better place.  Of course, there could be a huge thread on its own devoted to the public choice problems inherent in public pensions, but that's going pretty far out in left field.

ETA:  We do have some forced savings.  It's called social security, though I have no expectation that I will ever see a penny of those savings (and that is a problem inherent with a forced savings system).  I wouldn't have any problem whatsoever with expanding forced savings, and I think it's good public policy, but most people really don't like it.

[Sid888]

But this idea that, in order to "start to transition" out of the middle class, you need to be in a position where you never need to work again?  That is ridiculous, on both sides:  it implies that someone is upper class if they have very modest passive income but low enough spending to live on that passive income (e.g., $15k/year ERE types), and it implies that someone making $500k a year might not be upper class if they're a spendthrift and blow all of their cash.  Income is an imperfect substitute, but it gets rid of a lot of the noise.

Class should be defined in both terms of income and wealth in order to not unfairly target or classify those that perceive themselves as middle class as wealthy.  I think making money from money - with no need to labor - is a pretty good sign that a person is wealthy.  Another way of looking at how to best define whether a person is middle class or wealthy is how secure they are in retirement savings?  If we have a target number per person of $1, 2 or 3 million for retirement savings (taking into account age and subtracting expenses for kids, health care, etc.) , we might get a sense of how wealthy folks really are.  Wealth accumulation - not wages from labor - is a much bigger factor in retirement security. 

[Tabaxus]

But this idea that, in order to "start to transition" out of the middle class, you need to be in a position where you never need to work again?  That is ridiculous, on both sides:  it implies that someone is upper class if they have very modest passive income but low enough spending to live on that passive income (e.g., $15k/year ERE types), and it implies that someone making $500k a year might not be upper class if they're a spendthrift and blow all of their cash.  Income is an imperfect substitute, but it gets rid of a lot of the noise.

Class should be defined in both terms of income and wealth in order to not unfairly target or classify those that perceive themselves as middle class as wealthy.  I think making money from money - with no need to labor - is a pretty good sign that a person is wealthy.  Another way of looking at how to best define whether a person is middle class or wealthy is how secure they are in retirement savings?  If we have a target number per person of $1, 2 or 3 million for retirement savings (taking into account age and subtracting expenses for kids, health care, etc.) , we might get a sense of how wealthy folks really are.  Wealth accumulation - not wages from labor - is a much bigger factor in retirement security.

I do think it should be defined in terms of a combination of income and wealth, but doing wealth correctly is much more difficult.  If you turn it into being based entirely on security in retirement savings, are you basing that on an objective standard for retirement?  The perfect test probably is some balance between expected future earnings and current assets, but effectively testing that runs into a number of variables that is basically impossible to sort out.  You can't base tax policy on this.

If you want to tax based on wealth, are you going to tax the high-earning person who has not saved as much money at a higher rate to give them a chance to "catch up"?  I wouldn't think so.  If you're going to tax the frugal lifelong saver more highly on the wealth they have accumulated (before they die anyway--I think all bets are off at death), that's going to strongly incentivize people to over-consume/under-save.

[starguru]

But this idea that, in order to "start to transition" out of the middle class, you need to be in a position where you never need to work again?  That is ridiculous, on both sides:  it implies that someone is upper class if they have very modest passive income but low enough spending to live on that passive income (e.g., $15k/year ERE types), and it implies that someone making $500k a year might not be upper class if they're a spendthrift and blow all of their cash.  Income is an imperfect substitute, but it gets rid of a lot of the noise.

Are you sure?  The living off 15k type has ~400k in the bank.  They are rich compared to almost everyone on earth, and even most of the US populate, who is too busy buying useless crap to save any significant funds at all.

One can make 500k a year and still be poor.  Buy a few homes, a boat, a few fancy cars they can easily have negative NW.  They are not rich (and yes, the person in this example is an idiot), but they are a high earner.

The whole point is the "tax the rich" mantra is flawed because all it really means in Obama-speak is high earners.  Its demagoguery.  It's speaking nonsense that appeals to people who hear "it's someone else's responsibility".

I will acknowledge that tax policy debates would be on firmer ground if the debate was "tax high earners!" rather than "tax the rich!"  The recognition-event framework of taxation is designed around taxing income, not wealth.  And yes, the person who can afford to "buy a few homes, a boat, a few fancy cars" should be taxed at a significantly higher rate that the person who can afford to pay modest rent and food on their table.  The fact that a few people in the former group are idiots with their money isn't an indictment of progressive taxation.

Of course, I think we should tax wealth much more broadly at death (much broader and higher inheritance tax, get rid of the step up in basis, etc.), so it is what it is.  Despite being a relatively  high earner, I still believe very firmly in that pesky social contract that holds that we shouldn't be letting people starve in the streets or be deprived of solid public education or infrastructure.

Comparing the "retired with a $70k pension cop" and the accountant only works if you are equalizing salary over time.  Takes a lot of years on the job to have that vested pension, and the value of that pension should be "backed in" to the wages the cop received over his or her career to make a fair comparison to the accountant.  Obviously, if you turn the pension around and the cop had a much higher effective wage over his career than the accountant, it shouldn't be remotely surprising that the cop is in a better place.  Of course, there could be a huge thread on its own devoted to the public choice problems inherent in public pensions, but that's going pretty far out in left field.

ETA:  We do have some forced savings.  It's called social security, though I have no expectation that I will ever see a penny of those savings (and that is a problem inherent with a forced savings system).  I wouldn't have any problem whatsoever with expanding forced savings, and I think it's good public policy, but most people really don't like it.

[First bolded] - I don't think many would argue that starving people is good.  Social safety nets for actual legitimate need are important.

But it is a more legitimate question to ask what is expected vis-a-vis personal responsibility. I remember reading on these boards about some 48 Hours special on poverty where the family in the piece couldn't put food on the table but refused to give up cable (or something like that).  I remember seeing, during the height of the recent financial crisis, people driving to food banks in the Cadillacs (CBS Sunday Morning show, I believe).  Where is the line between legitimate need and refusing to tell someone who appears needy maybe they need less stuff.  I mean, is it reasonable to take tax dollars away from one to help another get food, when the other made shoddy financial decisions (as an example)?  If you say yes, then you are effectively saying some peoples taxes should go to other people's Cadillacs. 

Or more generally, if there is a social responsibility to help the truly needy, is there a social responsibility to do one's best not to be needy? 

[Second bolded].  SS is not forced savings.  Workers pay in, beneficiaries pay out. You might argue that any surplus is saved, but even if it happened in the past, the demographic picture is it wont happen in the future. 

[Tabaxus]

I completely agree that there is an issue between necessary safety nets and when, if ever, they should be pulled away because people made terrible decisions.  I don't think any decisions are ever terrible enough to justify allowing people to starve in the streets, and that is doubly true for situations where people have made really horrible decisions re the number of kids to have (it is not the kids' fault).  That said, I do agree that people who receive aid should be forced to cut things that aren't necessities. 

I'll acknowledge that thinking of social security as forced savings can be sloppy.  That's essentially what it is intended as.  I acknowledged the problems with it (like I said, I expect I will never see a penny of mine).  Are you envisioning a system of individual forced saving?  The problem there is that the government can always change the rules--as they will have to with social security--so it's exposed to the same issues that social security benefits will be facing down.  That's why I made the comparison.

[starguru]

I completely agree that there is an issue between necessary safety nets and when, if ever, they should be pulled away because people made terrible decisions.  I don't think any decisions are ever terrible enough to justify allowing people to starve in the streets, and that is doubly true for situations where people have made really horrible decisions re the number of kids to have (it is not the kids' fault).  That said, I do agree that people who receive aid should be forced to cut things that aren't necessities. 

I'll acknowledge that thinking of social security as forced savings can be sloppy.  That's essentially what it is intended as.  I acknowledged the problems with it (like I said, I expect I will never see a penny of mine).  Are you envisioning a system of individual forced saving?  The problem there is that the government can always change the rules--as they will have to with social security--so it's exposed to the same issues that social security benefits will be facing down.  That's why I made the comparison.

Starving children are always bad. 

I would personally favor forced personal savings.  To my mind there is a significant difference between money being taxed from earnings, going into a government system, and then redistributed to people, compared to government mandating forced savings, and the money not changing hands.  The latter is simpler, takes a massive bureaucracy out of the picture, and IMHO this lead to more personal responsibility.

I agree the government can always change the rules, but as you point out they can change the rules with the current system, so its a non-issue in that its gonna happen if its gonna happen.

I agree the gubment can always change the rules, but of course it can

[Sid888]

I'll acknowledge that thinking of social security as forced savings can be sloppy.  That's essentially what it is intended as.  I acknowledged the problems with it (like I said, I expect I will never see a penny of mine).  Are you envisioning a system of individual forced saving?  The problem there is that the government can always change the rules--as they will have to with social security--so it's exposed to the same issues that social security benefits will be facing down.  That's why I made the comparison.

Why are people so quick to say they are okay with the government taking social security benefits?  Losing SS is likely to cost you a hell of a lot more than a change in a tax rate but people fight the tax rate so much harder than a SS cut or a fix to solidify the system.

The Paul Ryans of the world are already chopping benefits along generational lines.  Why, because the boomers howl if you touch their benefits and Gen X and Gen Y say "I don't expect to see any of it..."

This nonsense has got to stop.   

[SaintM]

Definitely not middle class, but there are tax shelters available to you.  Real estate investing, municipal bonds, oil wells, and others.  Even forgoing stock sales so that you don't realize capital gains.  These strategies can reduce your adjusted gross income down to the point where you can take advantage of otherwise lost tax breaks (Roth contributions, personal exemptions, child tax credit, etc.).

[Sid888]

I completely agree that there is an issue between necessary safety nets and when, if ever, they should be pulled away because people made terrible decisions.  I don't think any decisions are ever terrible enough to justify allowing people to starve in the streets, and that is doubly true for situations where people have made really horrible decisions re the number of kids to have (it is not the kids' fault).  That said, I do agree that people who receive aid should be forced to cut things that aren't necessities. 

I'll acknowledge that thinking of social security as forced savings can be sloppy.  That's essentially what it is intended as.  I acknowledged the problems with it (like I said, I expect I will never see a penny of mine).  Are you envisioning a system of individual forced saving?  The problem there is that the government can always change the rules--as they will have to with social security--so it's exposed to the same issues that social security benefits will be facing down.  That's why I made the comparison.

Starving children are always bad. 

I would personally favor forced personal savings.  To my mind there is a significant difference between money being taxed from earnings, going into a government system, and then redistributed to people, compared to government mandating forced savings, and the money not changing hands.  The latter is simpler, takes a massive bureaucracy out of the picture, and IMHO this lead to more personal responsibility.

I agree the government can always change the rules, but as you point out they can change the rules with the current system, so its a non-issue in that its gonna happen if its gonna happen.

I agree the gubment can always change the rules, but of course it can

SS is forced savings in the sense that it takes money from your paycheck, pools it with other individuals (similar to a mutual fund or another "pooled" investment vehicle) and then pays you a benefit when you qualify.  The Supreme Court has ruled that you are "entitled" to receive this benefit so, unlike a mutual fund, it is backed by the United States government.  Unlike a mutual, you may receive more in benefits than you paid in (even with compounded interest) but you might receive less as well (if you die young, for instance).  It's also a safety net insurance policy that most, including MMM, see as a cornerstone for retirement security in the United States.

http://en.wikipedia.org/wiki/Entitlement

In the United States, an entitlement program is a type of "government program that provides individuals with personal financial benefits (or sometimes special government-provided goods or services) to which an indefinite (but usually rather large) number of potential beneficiaries have a legal right...whenever they meet eligibility conditions that are specified by the standing law that authorizes the program. The beneficiaries of entitlement programs are normally individual citizens or residents, although sometimes organizations such as business corporations, local governments, or even political parties may have similar special 'entitlements' under certain programs."[3] Examples of entitlement programs at the federal level in the United States include Social Security, Medicare and Medicaid, most Veterans' Administration programs, federal employee and military retirement plans, unemployment compensation, food stamps, and agricultural price support programs.[4][5]

[starguru]

I completely agree that there is an issue between necessary safety nets and when, if ever, they should be pulled away because people made terrible decisions.  I don't think any decisions are ever terrible enough to justify allowing people to starve in the streets, and that is doubly true for situations where people have made really horrible decisions re the number of kids to have (it is not the kids' fault).  That said, I do agree that people who receive aid should be forced to cut things that aren't necessities. 

I'll acknowledge that thinking of social security as forced savings can be sloppy.  That's essentially what it is intended as.  I acknowledged the problems with it (like I said, I expect I will never see a penny of mine).  Are you envisioning a system of individual forced saving?  The problem there is that the government can always change the rules--as they will have to with social security--so it's exposed to the same issues that social security benefits will be facing down.  That's why I made the comparison.

Starving children are always bad. 

I would personally favor forced personal savings.  To my mind there is a significant difference between money being taxed from earnings, going into a government system, and then redistributed to people, compared to government mandating forced savings, and the money not changing hands.  The latter is simpler, takes a massive bureaucracy out of the picture, and IMHO this lead to more personal responsibility.

I agree the government can always change the rules, but as you point out they can change the rules with the current system, so its a non-issue in that its gonna happen if its gonna happen.

I agree the gubment can always change the rules, but of course it can

SS is forced savings in the sense that it takes money from your paycheck, pools it with other individuals (similar to a mutual fund or another "pooled" investment vehicle) and then pays you a benefit when you qualify.  The Supreme Court has ruled that you are "entitled" to receive this benefit so, unlike a mutual fund, it is backed by the United States government.  Unlike a mutual, you may receive more in benefits than you paid in (even with compounded interest) but you might receive less as well (if you die young, for instance).  It's also a safety net insurance policy that most, including MMM, see as a cornerstone for retirement security in the United States.

http://en.wikipedia.org/wiki/Entitlement

In the United States, an entitlement program is a type of "government program that provides individuals with personal financial benefits (or sometimes special government-provided goods or services) to which an indefinite (but usually rather large) number of potential beneficiaries have a legal right...whenever they meet eligibility conditions that are specified by the standing law that authorizes the program. The beneficiaries of entitlement programs are normally individual citizens or residents, although sometimes organizations such as business corporations, local governments, or even political parties may have similar special 'entitlements' under certain programs."[3] Examples of entitlement programs at the federal level in the United States include Social Security, Medicare and Medicaid, most Veterans' Administration programs, federal employee and military retirement plans, unemployment compensation, food stamps, and agricultural price support programs.[4][5]

Yeah, one of the aspects of MMM that I never agreed with is the notion that one can be FI and have a plan that requires relying on programs like SS.  To me, the word independence implies independence, not dependence on government programs.  Hence I do not include any benefits when I consider my FI progression, even if I will receive benefits. 

Ok, gametime.

[CanuckExpat]

The Supreme Court has ruled that you are "entitled" to receive this benefit so, unlike a mutual fund, it is backed by the United States government.

I want to stay out of all these tangential arguments, but I want to know what you are referring to. I'm pretty sure the Supreme Court has ruled the opposite:
"The Court ruled that no such contract exists, and that there is no contractual right to receive Social Security payments. Payments due under Social Security are not “property” rights and are not protected by the Takings Clause of the Fifth Amendment. The interest of a beneficiary of Social Security is protected only by the Due Process Clause.
Under Due Process Clause analysis, government action is valid unless it is patently arbitrary and utterly lacking in rational justification. This provision of §202(n) is not irrational; it could have been justified by the desire to increase the purchasing power of those living in America, because those living abroad would not spend their payments here."

[Sid888]

I completely agree that there is an issue between necessary safety nets and when, if ever, they should be pulled away because people made terrible decisions.  I don't think any decisions are ever terrible enough to justify allowing people to starve in the streets, and that is doubly true for situations where people have made really horrible decisions re the number of kids to have (it is not the kids' fault).  That said, I do agree that people who receive aid should be forced to cut things that aren't necessities. 

I'll acknowledge that thinking of social security as forced savings can be sloppy.  That's essentially what it is intended as.  I acknowledged the problems with it (like I said, I expect I will never see a penny of mine).  Are you envisioning a system of individual forced saving?  The problem there is that the government can always change the rules--as they will have to with social security--so it's exposed to the same issues that social security benefits will be facing down.  That's why I made the comparison.

Starving children are always bad. 

I would personally favor forced personal savings.  To my mind there is a significant difference between money being taxed from earnings, going into a government system, and then redistributed to people, compared to government mandating forced savings, and the money not changing hands.  The latter is simpler, takes a massive bureaucracy out of the picture, and IMHO this lead to more personal responsibility.

I agree the government can always change the rules, but as you point out they can change the rules with the current system, so its a non-issue in that its gonna happen if its gonna happen.

I agree the gubment can always change the rules, but of course it can

SS is forced savings in the sense that it takes money from your paycheck, pools it with other individuals (similar to a mutual fund or another "pooled" investment vehicle) and then pays you a benefit when you qualify.  The Supreme Court has ruled that you are "entitled" to receive this benefit so, unlike a mutual fund, it is backed by the United States government.  Unlike a mutual, you may receive more in benefits than you paid in (even with compounded interest) but you might receive less as well (if you die young, for instance).  It's also a safety net insurance policy that most, including MMM, see as a cornerstone for retirement security in the United States.

http://en.wikipedia.org/wiki/Entitlement

In the United States, an entitlement program is a type of "government program that provides individuals with personal financial benefits (or sometimes special government-provided goods or services) to which an indefinite (but usually rather large) number of potential beneficiaries have a legal right...whenever they meet eligibility conditions that are specified by the standing law that authorizes the program. The beneficiaries of entitlement programs are normally individual citizens or residents, although sometimes organizations such as business corporations, local governments, or even political parties may have similar special 'entitlements' under certain programs."[3] Examples of entitlement programs at the federal level in the United States include Social Security, Medicare and Medicaid, most Veterans' Administration programs, federal employee and military retirement plans, unemployment compensation, food stamps, and agricultural price support programs.[4][5]

Yeah, one of the aspects of MMM that I never agreed with is the notion that one can be FI and have a plan that requires relying on programs like SS.  To me, the word independence implies independence, not dependence on government programs.  Hence I do not include any benefits when I consider my FI progression, even if I will receive benefits. 

Ok, gametime.

Well, unless you are pedaling a bike to generate your power while accessing the internet from the Thunderdome (http://en.wikipedia.org/wiki/Mad_Max_Beyond_Thunderdome) where you have successfully battled hundreds of post apocalyptic warriors for complete and individual domination, your retirement (and other) security is already completely dependent on the government.

Halftime Retort!  Back to the game.

Go Seahawks!

[starguru]

Well, unless you are pedaling a bike to generate your power while accessing the internet from the Thunderdome (http://en.wikipedia.org/wiki/Mad_Max_Beyond_Thunderdome) where you have successfully battled hundreds of post apocalyptic warriors for complete and individual domination, your retirement (and other) security is already completely dependent on the government.

Halftime Retort!  Back to the game.

Go Seahawks!

We are talking about financial independence, which has nothing or little to do with MadMax style apocalypse. 

Go Patriots!

[Sid888]

The Supreme Court has ruled that you are "entitled" to receive this benefit so, unlike a mutual fund, it is backed by the United States government.

I want to stay out of all these tangential arguments, but I want to know what you are referring to. I'm pretty sure the Supreme Court has ruled the opposite:
"The Court ruled that no such contract exists, and that there is no contractual right to receive Social Security payments. Payments due under Social Security are not “property” rights and are not protected by the Takings Clause of the Fifth Amendment. The interest of a beneficiary of Social Security is protected only by the Due Process Clause.
Under Due Process Clause analysis, government action is valid unless it is patently arbitrary and utterly lacking in rational justification. This provision of §202(n) is not irrational; it could have been justified by the desire to increase the purchasing power of those living in America, because those living abroad would not spend their payments here."

Interesting - and thanks for posting.  This case involved denial of SS benefits to a communist in 1960.  We'll likely get another case if SSDI runs dry and benefits are denied to a military veteran of the middle east conflict.  The latter fact pattern may result in a different outcome.  Of course, legislators and the chief executive would have to cut or deny to pay these benefits to the combat veteran first before it could ever be litigated.

[MoneyCat]

I just thought of a great solution for people concerned about the taxes for making $250,000/year.  Just donate some of your money to me, like say, $100,000 of it and then you won't have to worry about paying capital gains taxes on it.  It's a solution that works for everybody.

[mom2_3Hs]

Moneycat, I think the limit on untaxed gifts is $14,000, so you'd be paying the taxes on that $100 grand...

And the comment about ""That said, I do agree that people who receive aid should be forced to cut things that aren't necessities.  "...when you apply for food stamps, you have to demonstrate that you have less than $2250 in savings or personal property.  How vehicles count depends upon your state:  http://www.fns.usda.gov/snap/eligibility

[Sid888]

Well, unless you are pedaling a bike to generate your power while accessing the internet from the Thunderdome (http://en.wikipedia.org/wiki/Mad_Max_Beyond_Thunderdome) where you have successfully battled hundreds of post apocalyptic warriors for complete and individual domination, your retirement (and other) security is already completely dependent on the government.

Halftime Retort!  Back to the game.

Go Seahawks!

We are talking about financial independence, which has nothing or little to do with MadMax style apocalypse. 

Go Patriots!

Yes, but you are still arbitrarily cherry picking the issues you have problems with being dependent on the government for assistance.

Congratulations on the Patriots win.

[Tabaxus]

Moneycat, I think the limit on untaxed gifts is $14,000, so you'd be paying the taxes on that $100 grand...

And the comment about ""That said, I do agree that people who receive aid should be forced to cut things that aren't necessities.  "...when you apply for food stamps, you have to demonstrate that you have less than $2250 in savings or personal property.  How vehicles count depends upon your state:  http://www.fns.usda.gov/snap/eligibility

I know the requirements. I've been on food stamps before, and have family that still is.  I think the asset test cutoff is too low, and it's a problem that they don't make people cancel the cable, cancel the smartphone, sufficiently monitor the kind of food being bought (though I will admit that food deserts in urban areas are a real problem on this front, because SNAP does impose some limitations), etc. 

[starguru]

Moneycat, I think the limit on untaxed gifts is $14,000, so you'd be paying the taxes on that $100 grand...

And the comment about ""That said, I do agree that people who receive aid should be forced to cut things that aren't necessities.  "...when you apply for food stamps, you have to demonstrate that you have less than $2250 in savings or personal property.  How vehicles count depends upon your state:  http://www.fns.usda.gov/snap/eligibility

I know the requirements. I've been on food stamps before, and have family that still is.  I think the asset test cutoff is too low, and it's a problem that they don't make people cancel the cable, cancel the smartphone, sufficiently monitor the kind of food being bought (though I will admit that food deserts in urban areas are a real problem on this front, because SNAP does impose some limitations), etc.

This.

[capital]

I get SO tired of this narrative that people in expensive houses must live in McMansions in gated communities.  I work for a nonprofit in San Francisco proper, helping first time homebuyers get ready to purchase.  So basically, worst job ever cause all I do is break hearts.  I don't think anyone who doesn't live here can truly understand how awful our housing market is.  A small, run down house in a neighborhood with bad schools and poor infrastructure will go for $700,000.  Like a previous poster mentioned, you can get a parking spot for 100k, maybe, there are no houses even close to that price range whatsoever. (Unless you qualify for Below Market Rate, which we don't, and is beyond competitive).  You could save $ by moving an hour away but then enjoy your monster commute stealing 2 hours a day and $500/month in gas and tolls or whatever.  (not mustachian, people!) Salaries are higher here, but the housing market is completely unnattainable to all but the highest earners.  I have a colleague who has been making offers on 600k homes in the east bay (again, that's pretty cheap here) for a year, and hasn't gotten an offer accepted yet.  So even if you want to over-pay for something, good luck to you.

I would gladly live in a fixer-upper house in a fairly ugly, dull neighborhood if it meant I could own something.  We can't. At all. We make 150k/yr.  This isn't a complaint, life is pretty rainbows and butterflies in our long-term rent-controlled apartment, but not everyone here is so lucky.

Fruitvale station & a Brompton, you got a house for 2x income:
http://www.trulia.com/property/3146992788-2047-36th-Ave-Oakland-CA-94601

[starguru]

Well, unless you are pedaling a bike to generate your power while accessing the internet from the Thunderdome (http://en.wikipedia.org/wiki/Mad_Max_Beyond_Thunderdome) where you have successfully battled hundreds of post apocalyptic warriors for complete and individual domination, your retirement (and other) security is already completely dependent on the government.

Halftime Retort!  Back to the game.

Go Seahawks!

We are talking about financial independence, which has nothing or little to do with MadMax style apocalypse. 

Go Patriots!

Yes, but you are still arbitrarily cherry picking the issues you have problems with being dependent on the government for assistance.

Congratulations on the Patriots win.

Thanx, that was a rocky one.

And what?  We are talking about FI.  Financial Independence.  Money.   Saying the notion that one who relies on a government assistance program can't really be FI, since they have a dependency on something, has NOTHING to do with peoples' general reliance on government for day to day stability and protection against apocalyptic fantasies..  Your argument is so tainted I had to go look up what type of logical error you are making.  False Analogy.

[Sid888]

Well, unless you are pedaling a bike to generate your power while accessing the internet from the Thunderdome (http://en.wikipedia.org/wiki/Mad_Max_Beyond_Thunderdome) where you have successfully battled hundreds of post apocalyptic warriors for complete and individual domination, your retirement (and other) security is already completely dependent on the government.

Halftime Retort!  Back to the game.

Go Seahawks!

We are talking about financial independence, which has nothing or little to do with MadMax style apocalypse. 

Go Patriots!

Yes, but you are still arbitrarily cherry picking the issues you have problems with being dependent on the government for assistance.

Congratulations on the Patriots win.

Thanx, that was a rocky one.

And what?  We are talking about FI.  Financial Independence.  Money.   Saying the notion that one who relies on a government assistance program can't really be FI, since they have a dependency on something, has NOTHING to do with peoples' general reliance on government for day to day stability and protection against apocalyptic fantasies..  Your argument is so tainted I had to go look up what type of logical error you are making.  False Analogy.

Are you telling me that you don't use roads?

Marshawn Lynch should have plowed it in from 1 yard line but since the Seahawks were there on a very luck catch, I hope that Pete C. doesn't get grilled too badly today and forever...

[starguru]

Well, unless you are pedaling a bike to generate your power while accessing the internet from the Thunderdome (http://en.wikipedia.org/wiki/Mad_Max_Beyond_Thunderdome) where you have successfully battled hundreds of post apocalyptic warriors for complete and individual domination, your retirement (and other) security is already completely dependent on the government.

Halftime Retort!  Back to the game.

Go Seahawks!

We are talking about financial independence, which has nothing or little to do with MadMax style apocalypse. 

Go Patriots!

Yes, but you are still arbitrarily cherry picking the issues you have problems with being dependent on the government for assistance.

Congratulations on the Patriots win.

Thanx, that was a rocky one.

And what?  We are talking about FI.  Financial Independence.  Money.   Saying the notion that one who relies on a government assistance program can't really be FI, since they have a dependency on something, has NOTHING to do with peoples' general reliance on government for day to day stability and protection against apocalyptic fantasies..  Your argument is so tainted I had to go look up what type of logical error you are making.  False Analogy.

Are you telling me that you don't use roads?

Marshawn Lynch should have plowed it in from 1 yard line but since the Seahawks were there ona very luck catch, I hope that Pete C. doesn't get grilled to badly today and forever...

I think that play call will be questioned till the end of time.  I would like to see stats on interceptions on short slant routes vs fumbles on short runs -- i.e. was it really that dumb of a play call? Whats the worst that can happen -- yeah an interception, but if they ran it, beast mode could have fumbled, or the hand-off botched, or whatever. 

I'm telling you roads have nothing to do with Financial Independence as a concept and the elements that define that concept.  We are not talking about the value of government or even taxes anymore.  We are talking about a concept.  What does it mean to be financially independent.  I say one is not FI if one relies on money from an outside source.  Countering with "yeah but you need roads" has nothing to do with the definition of when one is financially independent. 

If I were saying "government is useless and we don't need it", the counterpoint "but wait don't you need some or all of the things government provides, l like roads" makes sense. 

[Tabaxus]

Requiring independence from a functioning government as an element of financial independence would un-FIRE the vast majority of FIRE'd people.  Be realistic.  Trying to plan around the end of days is ridiculous.

[Sid888]

Well, unless you are pedaling a bike to generate your power while accessing the internet from the Thunderdome (http://en.wikipedia.org/wiki/Mad_Max_Beyond_Thunderdome) where you have successfully battled hundreds of post apocalyptic warriors for complete and individual domination, your retirement (and other) security is already completely dependent on the government.

Halftime Retort!  Back to the game.

Go Seahawks!

We are talking about financial independence, which has nothing or little to do with MadMax style apocalypse. 

Go Patriots!

Yes, but you are still arbitrarily cherry picking the issues you have problems with being dependent on the government for assistance.

Congratulations on the Patriots win.

Thanx, that was a rocky one.

And what?  We are talking about FI.  Financial Independence.  Money.   Saying the notion that one who relies on a government assistance program can't really be FI, since they have a dependency on something, has NOTHING to do with peoples' general reliance on government for day to day stability and protection against apocalyptic fantasies..  Your argument is so tainted I had to go look up what type of logical error you are making.  False Analogy.

Are you telling me that you don't use roads?

Marshawn Lynch should have plowed it in from 1 yard line but since the Seahawks were there ona very luck catch, I hope that Pete C. doesn't get grilled to badly today and forever...

I think that play call will be questioned till the end of time.  I would like to see stats on interceptions on short slant routes vs fumbles on short runs -- i.e. was it really that dumb of a play call? Whats the worst that can happen -- yeah an interception, but if they ran it, beast mode could have fumbled, or the hand-off botched, or whatever. 

I'm telling you roads have nothing to do with Financial Independence as a concept and the elements that define that concept.  We are not talking about the value of government or even taxes anymore.  We are talking about a concept.  What does it mean to be financially independent.  I say one is not FI if one relies on money from an outside source.  Countering with "yeah but you need roads" has nothing to do with the definition of when one is financially independent. 

If I were saying "government is useless and we don't need it", the counterpoint "but wait don't you need some or all of the things government provides, l like roads" makes sense.

I just don't see a difference between the government providing and maintaining roads and providing and maintaining social security.  It's basically, the same thing.  Both are very useful in giving me the means to FIRE and I don't plan to do without either one in retirement.

[starguru]

Requiring independence from a functioning government as an element of financial independence would un-FIRE the vast majority of FIRE'd people.  Be realistic.  Trying to plan around the end of days is ridiculous.

Finally, an actual strawman. 

I never said "independence from a functioning government".  I said "reliance on government handouts" goes against my definition of FI.  I think it is very likely (or at least certainly possible) SS and other government programs will at least be means tested, or have some of their benefits cut (or both), in the future.  If such changes made it so one needed to work again, how can one be considered FI?

[Sid888]

Requiring independence from a functioning government as an element of financial independence would un-FIRE the vast majority of FIRE'd people.  Be realistic.  Trying to plan around the end of days is ridiculous.

Finally, an actual strawman. 

I never said "independence from a functioning government".  I said "reliance on government handouts" goes against my definition of FI.  I think it is very likely (or at least certainly possible) SS and other government programs will at least be means tested, or have some of their benefits cut (or both), in the future.  If such changes made it so one needed to work again, how can one be considered FI?

Social security is not a handout.

[starguru]

Are you telling me that you don't use roads?

Marshawn Lynch should have plowed it in from 1 yard line but since the Seahawks were there ona very luck catch, I hope that Pete C. doesn't get grilled to badly today and forever...

I think that play call will be questioned till the end of time.  I would like to see stats on interceptions on short slant routes vs fumbles on short runs -- i.e. was it really that dumb of a play call? Whats the worst that can happen -- yeah an interception, but if they ran it, beast mode could have fumbled, or the hand-off botched, or whatever. 

I'm telling you roads have nothing to do with Financial Independence as a concept and the elements that define that concept.  We are not talking about the value of government or even taxes anymore.  We are talking about a concept.  What does it mean to be financially independent.  I say one is not FI if one relies on money from an outside source.  Countering with "yeah but you need roads" has nothing to do with the definition of when one is financially independent. 

If I were saying "government is useless and we don't need it", the counterpoint "but wait don't you need some or all of the things government provides, l like roads" makes sense.

I just don't see a difference between the government providing and maintaining roads and providing and maintaining social security.  It's basically, the same thing.  Both are very useful in giving me the means to FIRE and I don't plan to do without either one in retirement.

Haha ok.  Yes because people need roads reliance on SS doesn't constitute a dependence in the definition of FI.  Congratulations, you found a way to be financially independent while maintaining a massive financial dependency. 

[starguru]

Requiring independence from a functioning government as an element of financial independence would un-FIRE the vast majority of FIRE'd people.  Be realistic.  Trying to plan around the end of days is ridiculous.

Finally, an actual strawman. 

I never said "independence from a functioning government".  I said "reliance on government handouts" goes against my definition of FI.  I think it is very likely (or at least certainly possible) SS and other government programs will at least be means tested, or have some of their benefits cut (or both), in the future.  If such changes made it so one needed to work again, how can one be considered FI?

Social security is not a handout.

Ah, quibbling...That's true, replace "handout" with "entitlement" and go again.

[Sid888]

Are you telling me that you don't use roads?

Marshawn Lynch should have plowed it in from 1 yard line but since the Seahawks were there ona very luck catch, I hope that Pete C. doesn't get grilled to badly today and forever...

I think that play call will be questioned till the end of time.  I would like to see stats on interceptions on short slant routes vs fumbles on short runs -- i.e. was it really that dumb of a play call? Whats the worst that can happen -- yeah an interception, but if they ran it, beast mode could have fumbled, or the hand-off botched, or whatever. 

I'm telling you roads have nothing to do with Financial Independence as a concept and the elements that define that concept.  We are not talking about the value of government or even taxes anymore.  We are talking about a concept.  What does it mean to be financially independent.  I say one is not FI if one relies on money from an outside source.  Countering with "yeah but you need roads" has nothing to do with the definition of when one is financially independent. 

If I were saying "government is useless and we don't need it", the counterpoint "but wait don't you need some or all of the things government provides, l like roads" makes sense.

I just don't see a difference between the government providing and maintaining roads and providing and maintaining social security.  It's basically, the same thing.  Both are very useful in giving me the means to FIRE and I don't plan to do without either one in retirement.

Haha ok.  Yes because people need roads reliance on SS doesn't constitute a dependence in the definition of FI.  Congratulations, you found a way to be financially independent while maintaining a massive financial dependency.

Thank you, the difference between you and I is that you're living in denial of your dependence on government for financial security