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Re: Comments please
Old 03-29-2006, 02:14 PM   #21
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Sorry if this is a stupid question. Right now my husband's employer pays 100% of our health insurance. We are on the hook for co-pays. When we retire, we will start paying 100% of our own health insurance. Now, don't we get a tax write-off for some portion of the money we pay on health care related expenses? And if so, how much of it can we write off?

For instance, I reckon we'll need about 12,000 for health expenses the first year (could be more.) Say our base expenses for living comfortably are $50,000; we'll need to draw an additional $12,000 for health care from our investments. Does this actually raise our taxable income by $12,000? Or do we first get a break on the $12,000 we spent on insurance, then tax is calculated on the remainder?
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Re: Comments please
Old 03-29-2006, 02:21 PM   #22
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Re: Comments please

Generally you can write off health care costs on what exceeds 7.5% of your AGI.

If you...umm..."time" your withdrawals and pool your expenses, you can have very little AGI in alternating years, and a whole lot in others. For example, taking a years expenses in december and then again 13 months later. Paying all of your real estate taxes a little early while deferring medical expenses a month or two. That may work out in your favor. It might not. Use something like turbotax to model it.

Yes, taking the extra 12k may raise your AGI. It depends on where it comes from and how its harvested. Regular income like interest? Qualified dividends? Long term capital gains?
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Old 03-29-2006, 02:54 PM   #23
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Quote:
Originally Posted by Sr. Senor Cute 'n' Fuzzy Bunny
Generally you can write off health care costs on what exceeds 7.5% of your AGI.
If you...umm..."time" your withdrawals and pool your expenses, you can have very little AGI in alternating years, and a whole lot in others.
If you go this approach, make sure that the doctor's staff knows you're without insurance (or have a high deductible).* Once they know they don't have to bill & process through an insurance company they may squeal "Woo-hoo!" and give you a 20% discount like our kid's dentist does.

If you're paying your own way (those high deductibles again) you may also be able to bunch your medical expenses into the same tax year by doing "annuals" at periodicities of 11 months between the first two, 13 months between the second & third, 11 months between the third & fourth, and so on.
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Old 03-29-2006, 04:35 PM   #24
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I like it. I got 53% gross required after retirement, which matches very closely with my plan.

Thanks for all the good work on this.
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Old 03-30-2006, 07:52 AM   #25
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Quote:
Originally Posted by dory36
Great idea - thanks. If it's ok with you, maybe I'll just use your examples (and reference the source).
Dory,
That is fine by me and just reference book info and publisher thx.

With an actual worksheet though you can probably do better than the book by including some of the detail on types of taxes or some additional calculations which people could use if they wanted or just accept the defaults from the book examples -- something like that. PM me if you like and we can work on it together.
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Old 04-30-2006, 06:05 PM   #26
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Here's the version after all the feedback...

http://firecalc.com/real-cost-of-living.php
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Old 04-30-2006, 06:15 PM   #27
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Re: Comments please

WOW, I wish I spent the BLS amounts on property taxes and health insurance (stopped there to adjust my bifocals)! Assuming this is a per-person amount I wonder about the household size.
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Old 04-30-2006, 06:49 PM   #28
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No -- household of 2, not indiv.
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Old 04-30-2006, 09:23 PM   #29
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Humm..* I don't buy their numbers for a middle-income couple, where most of this board would be pegged.* Even if we down-sized big time it would be tough to find a two-bedroom home on the west coast where property taxes were anything like the number they quote.*

I know just enough about statistics to be wary of 'averages', but I can fill in our numbers to test our personal reality.
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Old 04-30-2006, 09:57 PM   #30
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Quote:
Originally Posted by dory36
Here's the version after all the feedback...
Dory,

I think the idea of an expense calculator is a good one. The benchmarks, however, feel quite unnatural to me and might create more confusion than they prevent -- probably because they are "means" rather than typical numbers. Also, the expense categories are a little odd (there are columns for footware and personal care, but none for mortgage/rent; a post-retirement health insurance total of $817 seems inappropriate before medicare, etc.).

I wonder if it might be simpler if you suppressed the benchmarks. Anyone who would use this must have some type of spreadsheet or Quicken-like program as their source of data. The stats you reference are presumably predominantly pre-retirement households or a mix, yet the implementation is for post-retirement (and often pre-Medicare/SS). My impression is that the stats are of limited interest, have low applicability to most intended users, could be misinterpreted, and add little to the application. At most, perhaps provide a line by line button to pop up the relevant stats if desired.

Even after losing the stats, the remainder provides a very useful worksheet, and calculating the percentages in real time is enlightening.
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Old 05-01-2006, 06:16 AM   #31
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Ha ... I can't win. The earlier version (http://fireseeker.com/spending) was simpler and omitted all the comparables,* and some thought it was less useful because of the simplicity and missing national average data.*

The folks living in low cost-of-living states wonder about the high levels of spending on some items, while the folks living in high cost areas wonder about the low levels.

So, with one foot in ice water and one foot in boiling water, on average, I'm doing ok.* :P

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Old 05-01-2006, 10:41 AM   #32
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Re: Comments please

What the BLS statistics do is remind us that many spend less, least we get full of ourselves.

Regional statistics, even for age groups, is available on the BLS website. Maybe we can provide a link for the group to use. [I am packing for a vacation celebrating a benchmark birthday so won't have much time today to provide the link. PM me if you don't locate it - I can figure out where I found it when I return.]

Dory, I want to thank you for your efforts for all of us. You do great work.
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Old 05-01-2006, 11:00 AM   #33
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Quote:
Originally Posted by dory36
So, with one foot in ice water and one foot in boiling water, on average, I'm doing ok.* :P
Dory, it could be worse-- you could be cramming code all weekend trying to make a shipping date so that you could pay the mortgage! Maybe Laurence could help you with some of the security features...

I figure you're doing this for (1) fawning approbation from hordes of grateful users who'll donate megabucks to the server fund or (2) creating art for the artist's enjoyment while enjoying reading comments that used to be a source of major software frustration.
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Old 05-01-2006, 11:41 AM   #34
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Quote:
Originally Posted by Brat
Regional statistics, even for age groups, is available on the BLS website.* Maybe we can provide a link for the group to use.* [I am packing for a vacation celebrating a benchmark birthday so won't have much time today to provide the link.* PM me if you don't locate it - I can figure out where I found it when I return.]
If I don't find it before you get back, please send it. I only found info that didn't lend itself to massaging. But if I can find the data in a useful form, I can make that chart accommodate different data sets regionally, etc.

Thanks
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Old 05-01-2006, 11:45 AM   #35
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Quote:
Originally Posted by Nords
Dory, it could be worse-- you could be cramming code all weekend trying to make a shipping date so that you could pay the mortgage!* Maybe Laurence could help you with some of the security features...

I figure you're doing this for (1) fawning approbation from hordes of grateful users who'll donate megabucks to the server fund or (2) creating art for the artist's enjoyment while enjoying reading comments that used to be a source of major software frustration.
(3) It makes a great excuse why I am too busy to (a) mow the yard, (b) clean out the garage, (c) anything else I'd rather not do.
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Old 05-01-2006, 11:47 AM   #36
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Quote:
Originally Posted by dory36
(3) It makes a great excuse why I am too busy to (a) mow the yard, (b) clean out the garage, (c) anything else I'd rather not do.*
Debugging to avoid yardwork. Works for me!
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Old 05-01-2006, 12:31 PM   #37
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Re: Comments please

Quote:
Originally Posted by dory36
If I don't find it before you get back, please send it. I only found info that didn't lend itself to massaging. But if I can find the data in a useful form, I can make that chart accommodate different data sets regionally, etc.

Thanks
Drop down box at the top where you select a region or a 'type' of area, such as inland low cost, coastal high cost, possum catching areas of michigan), then the data for that area or 'type of area' loads? Also maybe show three sets of numbers for that region, for low, median and high?

I also could use something that does the dishes and keeps the baby away from the computer. See what we can do about that? Maybe by the end of the business day tomorrow because that was the first ridiculously arbitrary date that I could think of?
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Old 05-01-2006, 12:58 PM   #38
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Re: Comments please

[task accomplished, home quiet at the moment]

The resouce for consumer spending data can be found at:
http://www.bls.gov/cex/home.htm#links

I like the "Two Year Tables" for all their choices.

Dory, you could simply reference this resource and (maybe) provide a way for the user to enter the data of their choice, then enter their own spending info -- saving each for future use.

The one report with the most twists of data (by age, area, income) is a 20 page pdf file http://www.bls.gov/cex/csxann03.pdf
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Old 05-01-2006, 03:30 PM   #39
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Hmmm -- the pdf file comes through fine. Can you tell me which of the links you followed on the links page? I tried several, and got only paragraphs of explanation with each -- no data.

Thanks!
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Old 05-01-2006, 04:00 PM   #40
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Quote:
Originally Posted by dory36
Hmmm -- the pdf file comes through fine. Can you tell me which of the links you followed on the links page? I tried several, and got only paragraphs of explanation with each -- no data.

Thanks!
Try this one for CPI data by year and month from 1913 to March 2006
ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt
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