How to Stash 1 Million

In my experience with counseling people, I will agree with you. Most of the time people will opine in a certain way, or choose their "friends" in such a way that they feel that they are better than...

Humans do strange things to stoke the ego. Personally, I don't believe you can fool yourself and why bother trying to fool others. :)
 
jazztbone said:
A traditional defined benefit plan is a pension plan.
As a small business owner, you can set up a personal defined benefit plan that let's you contribute for more than personal 401k plans or SEPs, but there are more complexities that you need to understand. Schwab will now setup and administer these plans for small businesses, including sole proprietors, I believe. See Personal Defined Benefit

and The Perks of the Solo Defined-Benefit Plan - Personal Finance - Taxes - SmartMoney.com
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Deferring such large amounts to a DB plan as a sole proprietor seems to be completely out of whack with other retirement account options. It sounds like a bit of legislation put in by a special interest
 
nun said:
It sounds like a bit of legislation put in by a special interest
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Really? :rolleyes:

Have we read about how 401k accounts came about? The way I understand it, it was not meant for the lowly workers, but for executives. Then, an accountant discovered that the wording of the laws was such that Joe and Jane Blows could also have something that was originally meant for the privileged few.

PS. This link has some more info on the birth of the common 401k, and the man who has been called "the father of 401k accounts".

http://www.sbnonline.com/2002/12/original-retirement-plan-the-origins-of-401-k-plans/
 
nun said:
An interesting aspect is the big tax break the self employed get on retirement savings. This seems like one of those loop holes that needs to be fixed in tax reform.
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Really, so folks that take risks to start businesses out of the blue should be punished for doing so? I think they are already punished in many ways dealing with OSHA and EPA and others..........;)
 
NW-Bound said:
Really? :rolleyes:

Have we read about how 401k accounts came about? The way I understand it, it was not meant for the lowly workers, but for executives. Then, an accountant discovered that the wording of the laws was such that Joe and Jane Blows could also have something that was originally meant for the privileged few.
Click to expand...

My point is the enormous size of the tax deferral possible and the small number of people that it could possibly cover.

401ks became popular as a way of shifting costs off companies and onto the employee.....however, wage stagnation and lack of retirement funding knowledge are major reasons why most Americans are completely unprepared for retirement, let alone ER. For the 401k to be a viable replacement of the DB plan would have required salary increases to replace the value of a DB plan and financial education up the the average level of those on this board.
 
FinanceDude said:
Really, so folks that take risks to start businesses out of the blue should be punished for doing so? I think they are already punished in many ways dealing with OSHA and EPA and others..........;)
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Of course not, the amount they can defer into a DB plan is an anomoly. It's just so much more than anything else. I was just wondering why. How come I can't defer that much or put $46k into my DC plan.
 
But you already know the answer: because you are not part of a special interest.

And speak of special interests, perhaps someone will correct me if I am wrong, but I have read the following.

Our honorable law makers get lots of money donated to them for campaigning. The money could be used only for that purpose, not to do a kitchen remodeling on their home for example.

But what if the money is not all spent? Perhaps it is too much trouble to return it to the donors, so the law allows the fund to be added to their personal retirement accounts. Nice, huh?

Who passed those "nice, nice" laws, I wonder? :whistle: I am sure it had bipartisan support!
 
nun said:
Of course not, the amount they can defer into a DB plan is an anomoly. It's just so much more than anything else. I was just wondering why. How come I can't defer that much or put $46k into my DC plan.
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It's easy- Start your own business, invest in the physical plant and infrastructure, hire employees, make payroll, pay FICA, State, Federal and Local taxes,pay licensing fees, insurance, etc. If there is enough left to turn a profit, defer $46K into a DB plan.

Since you don't have your own business, why are you worrying about this "anomoly"?


If anyone could do it, everyone would do it. I'm pretty sure I couldn't, YMMV.
 
Westernskies said:
Since you don't have your own business, why are you worrying about this "anomoly"?


If anyone could do it, everyone would do it. I'm pretty sure I couldn't, YMMV.
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The deficit is why I worry.
 
RetiredGypsy said:
Pay more instead of spend less seems at such odds with LBYT.
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Doing both would be best.....we are doing neither.

I feel that I am not taxed enough. I have enough money to ER at 50 and so I also have enough to stand a bit more of a tax burden.
 
nun said:
I feel that I am not taxed enough. I have enough money to ER at 50 and so I also have enough to stand a bit more of a tax burden.
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Feel free to send in an extra check. Nobody is stopping you.

Don't worry, they told us that, this time, they will use the money wisely.
 
nun said:
Doing both would be best.....we are doing neither.

I feel that I am not taxed enough. I have enough money to ER at 50 and so I also have enough to stand a bit more of a tax burden.
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No need to wait for them to demand the extra money at all. Feel free to send as much as you want any time.

Government - Frequently Asked Questions about the Public Debt

Financing the Debt

Why does the debt sometimes decrease?

The Public Debt Outstanding decreases when there are more redemptions of Treasury securities than there are issues.
How do you make a contribution to reduce the debt?

There are two ways for you to make a contribution to reduce the debt:

  • You can make a contribution online either by credit card, checking or savings account at Pay.gov
  • You can write a check payable to the Bureau of the Public Debt, and in the memo section, notate that it's a Gift to reduce the Debt Held by the Public. Mail your check to:

    Attn Dept G
    Bureau of the Public Debt
    P. O. Box 2188
    Parkersburg, WV 26106-2188
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Gifts to the United States Government: Questions and Answers: Financial Management Service

Gifts to the United States Government

How do I make a contribution to the U.S. government?
Citizens who wish to make a general donation to the U.S. government may send contributions to a specific account called "Gifts to the United States." This account was established in 1843 to accept gifts, such as bequests, from individuals wishing to express their patriotism to the United States. Money deposited into this account is for general use by the federal government and can be available for budget needs. These contributions are considered an unconditional gift to the government. Financial gifts can be made by check or money order payable to the United States Treasury and mailed to the address below.
Gifts to the United States
U.S. Department of the Treasury
Credit Accounting Branch
3700 East-West Highway, Room 622D
Hyattsville, MD 20782
​
Any tax-related questions regarding these contributions should be directed to the Internal Revenue Service at (800) 829-1040.
Click to expand...
 
So: I won't give willingly by myself, but please take from everyone, willingly or not. That's still 100% for "Thanks, but no thanks" when I give that link to anyone who wants more money going to help the government. :nonono:
 
RetiredGypsy said:
So: I won't give willingly by myself, but please take from everyone, willingly or not. That's still 100% for "Thanks, but no thanks" when I give that link to anyone who wants more money going to help the government. :nonono:
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I give willingly now and would give more if required, we are talking about taxation not charity. I believe that tax is too low. How much do you think you should be taxed? Are current levels ok with you?
 
nun said:
yawn

I believe taxes should be higher on ALL those able to pay......myself included. We need sensible spending and revenue producing policies, we have neither.
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No I think taxes should be higher on you. You want all that stuff. You pay for it.
 
MasterBlaster said:
No I think taxes should be higher on you. You want all that stuff. You pay for it.
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If I have 2x your wealth then of course I should pay a higher percentage. Like you I believe we need to cut costs, I don't want "all that stuff" either. What level of taxation is ok with you, just curious.
 
nun said:
If I have 2x your wealth then of course I should pay a higher percentage. Like you I believe we need to cut costs, I don't want "all that stuff" either. What level of taxation is ok with you, just curious.
Click to expand...

I would cap taxation levels at whatever you pay and no more.
 
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