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Old 04-14-2011, 12:48 PM   #41
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If it was legal to take candy from a baby would you?

What kind of candy? If it's M&Ms, darn right I'll take candy from the baby. Besides it would be a chocking hazard and therefore stealing candy from a baby would make me a responsible adult...
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Old 04-14-2011, 12:52 PM   #42
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My closest friend who is a libertarian is right again. A system that "takes from each according to his ability", and "gives to each according to his needs" will eventually get to where we are.

If we forgive loans based on one's income, how do we differentiate between one's lack of income due to not being able to find work, versus not wanting to work and just wanting to ER?

We penalize a couple who together make $300K, and would tax them differently if they were two individuals making $150K each. Is that because of the different needs?

If you go through the SS calculator, you will find that someone who pays 40 years into the system will not be getting 4 times more than a person who works the minimum 10 years.
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Old 04-14-2011, 12:56 PM   #43
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This debate is akin to debating religion or politics. But no matter how you spin it, every defintion of "loan" includes a presumption of good-faith intention to repay.
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Old 04-14-2011, 01:10 PM   #44
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Just a simple post to show support of Westernskies post. He/She explain my shared opinion better than I could.

It fears me to see the tax code being referenced as the guide between right and wrong on this particular issue. The tax code is a guide for calculating tax liability, nothing more.

I love to read the stories on this forum about people who worked hard, saved, took calculated risks with their money, and are now looking forward to or currently experiencing FIRE/ER. However, a strategy of defaulting on loans, when one is capable, and using the tax code as justification for their actions is disheartening.
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Old 04-14-2011, 01:11 PM   #45
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I don't know, maybe all of you personal responsibility advocates have a point. But I sure like a good scheme
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Old 04-14-2011, 01:44 PM   #46
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I don't know, maybe all of you personal responsibility advocates have a point. But I sure like a good scheme
It's funny because I fall down on the personal responsibility side of the aisle (to the right if you know what I mean). But I would be a fool NOT to take advantage of opportunities that present themselves.

Some here criticize, and question whether I can look my kids in the eye. Now I'll have more time to spend with them. I try to explain to them that the system is frequently broken in many places. But I would not in good conscience be able to council them against receiving free money when offered. Because they will be paying it back. While all the current folks on this board will be ER'd, my kids will be slaving away paying taxes to repay the debt currently incurred and to pay the social welfare benefits (medicare and SS) of those retired. Thems the breaks.

I guess no one wants to hear about how my kids will probably get free or nearly free lunches at school either? (gas to FIRE gas to FIRE)
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Old 04-14-2011, 02:06 PM   #47
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But I would not in good conscience be able to council them against receiving free money when offered. Because they will be paying it back.
Including the "free"money you're getting on your loan mod and student loans... "Do as I say, not as I do?"

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I guess no one wants to hear about how my kids will probably get free or nearly free lunches at school either? (gas to FIRE gas to FIRE)
Why not send them to school with "free" cheese sandwiches instead?- I hear the feds are still handing it out to the truly needy. That way they won't have the social stigma of carrying their junior welfare meal cards.

Self-respect is over-rated anyway.
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Old 04-14-2011, 02:49 PM   #48
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Fuego,
+1 to those critical of your position regarding defaulting on the student loans as a strategy and not a necessity.
You CAN pay them back, but you chose not to because you do not WANT to and think you can get away with it. You have placed your WANTS in front of your integrity. If it benefits you to steal or lie (both of which you are doing by defaulting on the loans), would you continue to do so?
Shame.
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Old 04-14-2011, 02:50 PM   #49
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There may be a similar ethical choice in my future. I live in MA and if my annual income is under $35k a year I will be eligible for state subsidized health care. I've looked at the forms and made initial enquiries with the state and it seems that they don't take total assets into account, just annual income. With my house paid off and no other debt my need for income is less than $35k a year. So even though my portfolio will be more than $1M, I can arrange things so that I take enough each year to qualify for the subsidized health care. Should I do that when I can easily afford to pay for health care without the state subsidy?
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Old 04-14-2011, 02:56 PM   #50
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Including the "free"money you're getting on your loan mod and student loans... "Do as I say, not as I do?"
I think my message got crossed. I am saying that I WOULD tell my kids to take advantage of all these programs and giveaways. Because they are going to be paying more for these programs in some manner for most of their adult life (regardless of whether they take advantage of these programs). So "Do as I do" is the advice I would give. Hate to be a hypocrite.

Quote:
Why not send them to school with "free" cheese sandwiches instead?- I hear the feds are still handing it out to the truly needy. That way they won't have the social stigma of carrying their junior welfare meal cards.

Self-respect is over-rated anyway.
I believe food stamps are asset tested, hence I would (rightfully so) not qualify. For some reason Free and reduced lunches are not asset tested, therefore I would likely be eligible based on income alone (for reduced lunch, maybe free lunch some years). Qualifying for free or reduced lunch also enables my children to get access to many extracurricular programs and private tutoring at their school that we currently do not qualify for (due to our income). Their school is something like 90% free/reduced lunch which makes it rather high poverty (on paper at least).

Besides, why would I allow my kids to eat mere cheese sandwiches when they can eat a hot meal paid for by others? It's entitlement central over here. Just trying to get my kids a piece of the pie, cake, pizza, green beans, tater tots, and milk. I think the school actually makes a slight profit off of giving away free lunches, so I'm just doing my part to get funding for our school.

Look, all these entitlement programs and subsidies bug me too. I wish we weren't paying for all this, because it doesn't seem like it is necessary in many cases (in my case and many others).

But, hey, some day I may need the money I am saving to do things like pay for other social welfare programs via higher income taxes, broader reach of AMT, imposition of a National sales tax or VAT, partial loss of SS and/or medicare due to means testing, etc.

I would prefer the system to be rejiggered so that we don't spend money like drunken sailors on this stuff, but I'm not going to let myself be taken advantage of in the mean time.
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Old 04-14-2011, 02:57 PM   #51
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It's funny because I fall down on the personal responsibility side of the aisle (to the right if you know what I mean). But I would be a fool NOT to take advantage of opportunities that present themselves.

Some here criticize, and question whether I can look my kids in the eye. Now I'll have more time to spend with them. I try to explain to them that the system is frequently broken in many places. But I would not in good conscience be able to council them against receiving free money when offered. Because they will be paying it back. While all the current folks on this board will be ER'd, my kids will be slaving away paying taxes to repay the debt currently incurred and to pay the social welfare benefits (medicare and SS) of those retired. Thems the breaks.

I guess no one wants to hear about how my kids will probably get free or nearly free lunches at school either? (gas to FIRE gas to FIRE)
WOW! I think the issue is that you received something of value that has in some way helped you on your road to ER and you now plan to default on your loan. I'm glad my Dad didn't act like you, he would never have been able to justify such behaviour.
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Old 04-14-2011, 02:59 PM   #52
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nun, Certainly an interesting delema. However it does not go as far down the unethical path as we have been discussing. You have not taken a loan and promissed to pay it back...I have a problem with promisses unkept.
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Old 04-14-2011, 02:59 PM   #53
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Look, all these entitlement programs and subsidies bug me too. I wish we weren't paying for all this, because it doesn't seem like it is necessary in many cases (in my case and many others).

But, hey, some day I may need the money I am saving to do things like pay for other social welfare programs via higher income taxes, broader reach of AMT, imposition of a National sales tax or VAT, partial loss of SS and/or medicare due to means testing, etc.

I would prefer the system to be rejiggered so that we don't spend money like drunken sailors on this stuff, but I'm not going to let myself be taken advantage of in the mean time.
If this is supposed to justify your behaviour you have serious issues. This is no longer worth my time
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Old 04-14-2011, 03:00 PM   #54
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Fuego,
+1 to those critical of your position regarding defaulting on the student loans as a strategy and not a necessity.
You CAN pay them back, but you chose not to because you do not WANT to and think you can get away with it. You have placed your WANTS in front of your integrity. If it benefits you to steal or lie (both of which you are doing by defaulting on the loans), would you continue to do so?
Shame.
I am neither lying nor stealing. I AM paying these loans off currently. When my income is reduced during ER, I intend to continue paying my loans subject to the rules currently in place for Income Based Repayment. I may end up paying them all off in full if my assets rise to a sufficient level where my withdrawals (and therefore income) are large enough to make my Income Based payments of sufficient size that would result in full payment over 25 years. I'm not expecting that to happen, but if I get lucky, the taxpayers get lucky!
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Old 04-14-2011, 03:06 PM   #55
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There may be a similar ethical choice in my future. I live in MA and if my annual income is under $35k a year I will be eligible for state subsidized health care. I've looked at the forms and made initial enquiries with the state and it seems that they don't take total assets into account, just annual income. With my house paid off and no other debt my need for income is less than $35k a year. So even though my portfolio will be more than $1M, I can arrange things so that I take enough each year to qualify for the subsidized health care. Should I do that when I can easily afford to pay for health care without the state subsidy?
I don't see this as an ethical choice. Seems like strictly financial, similar to my choice to use Income Based Repayment for student loan debt.

Would you seriously NOT consider taking the subsidy? Who is better at deciding how to allocate your money, you or the state of MA? Why not take the subsidy and donate it to friends, family, charities, etc? Wouldn't that represent your personal values much more than having politicians blowing it on whatever wins them votes?

I guess don't respond since you are "done".
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Old 04-14-2011, 03:07 PM   #56
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Well, congratulations on your little student loan scam & it's boost toward your ER. Rationalize it all you want, it's still cheating, and the pats on the back you're getting for your accomplishment disgust me enough to exit this forum permanently.
Huh, do you or anyone against FUEGO's strategy read BusinessWeek that featured articles how billionaires or billions worth companies manipulate the tax code, laws with loopholes? It's all legal and the rich get richer. And here a mere mortal found a way to use our "smart" government's created laws to his advantage, and y'all got upset. If it's legal, good for him . Like someone said, law is not always ethical, but it's legal
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Old 04-14-2011, 03:19 PM   #57
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On a more humorous note, this thread is really making me want to keep working at my public sector job! Heck, 10 more years of it and I'll have those loans forgiven completely without paying a dime and no one can say I didn't work for it. My wife could retire right now and we could get the free government lunches immediately.

AND, I would get my awesome government pension! Which would bring the derision of many here.

If it makes anyone feel any better, I am currently paying into my mandatory government pension, and I plan to, at best, get merely a refund of what I have put in without any interest on it even though it will sit in their plan for many years. A government run program that cuts against me. Gotta git while the gittin is good! Cause you are going to be subsidizing something somewhere. Can't keep Uncle's hands outta your pocket.
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Old 04-14-2011, 03:34 PM   #58
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Like someone said, law is not always ethical, but it's legal
Probably a quote from a Yellow Pages lawyer.
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Old 04-14-2011, 03:51 PM   #59
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I have to admit that as I get older, I am moving more and more toward a position similar to Fuego. In the past, I was happy to pay taxes to finance the public good. However, I now realize that the majority of the county is looking out one for number 1 (themselves):

All taxes are bad except the ones they do not pay
All tax breaks are bad except the ones they get
All entitlement programs are bad except for the ones they participate in
All earmarks are bad except the ones that benefit them

I am starting to feel that the minority who actually ask "what is good for the county" are being fleeced by the majority who ask "what is good for me." The system can always tolerate a few people who think this way, and they will always exist. However, when they become a strong majority, this is a big problem.

In todays self-centered environment, I would do the same as Fuego. It is financial self-defense.
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Old 04-14-2011, 04:08 PM   #60
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In todays self-centered environment, I would do the same as Fuego. It is financial self-defense.
Thanks for the comment!

At this point I am not going to respond to any more comments regarding income based repayment of loans (or default as some refer to it), free lunches, or other ancillary aspects of my FIRE plan due to a request to "stop trolling" from the mods (whom I respect). Paying less than 100% of my student loans and getting my kids reduced price lunches are relatively minor aspects of my FIRE plan.

Other questions/comments regarding my FIRE plans are welcome and will be addressed.
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