A Senior Bail Out?

[Another Reader]

Perhaps offer a holiday from having to take RMDs (as was done one year during the last recession). That is all I could accept as fair.

Old people as a group are not politically popular just now, and there are other, greater needs to address.

Hey, Mitt Romney wants to send every adult American $1,000. No age discrimination there.

Not sure what all the RMD's add up to, but if it reduces pressure to take the money and run, an RMD holiday might be helpful. Of course, some people have already taken theirs out, not sure how to make it fair. And some people have to take the money for living expenses.

 

[CRLLS]

I have wondered about the FIRED group and if there would be any plans to help some of them and how it might work. For those who planned and implemented a fixed 4% annual withdrawal, not the trinity version, that 4% will be less and less to live on. We FIRE'd may not be as affected as the working group, but we are not unaffected entirely. And let's face it, when the situation starts to rebound, whatever help they received would most likely be spent to help the economy recover.

 

[Starsky]

For seniors who depend on their IRA earnings for income, it would make sense to allow retirees to withdraw from their IRAs tax-free this year. We are taking huge hits and can't necessarily wait for the recovery. The Feds can set withdrawal limits if they want.

I'd totally trade a $1K check for this benefit. It only costs the government .12-.22 cents on the dollar to help seniors to help themselves. I wrote my Congressman to ask for the relief. It couldn't hurt... If you like the idea, write yours.

 

[Midpack]

I have wondered about the FIRED group and if there would be any plans to help some of them and how it might work. For those who planned and implemented a fixed 4% annual withdrawal, not the trinity version, that 4% will be less and less to live on. We FIRE'd may not be as affected as the working group, but we are not unaffected entirely. And let's face it, when the situation starts to rebound, whatever help they received would most likely be spent to help the economy recover.

For seniors who depend on their IRA earnings for income, it would make sense to allow retirees to withdraw from their IRAs tax-free this year. We are taking huge hits and can't necessarily wait for the recovery. The Feds can set withdrawal limits if they want.

I'd totally trade a $1K check for this benefit. It only costs the government .12-.22 cents on the dollar to help seniors to help themselves. I wrote my Congressman to ask for the relief. It couldn't hurt... If you like the idea, write yours.

We’re two weeks in and no one has lost anything unless they’ve sold more than standard withdrawal, that’s a self inflicted wound. And FI implies we’ve planned for the worst and hope for the best. Lots of people who will be hurt a lot worse than seniors in general. Many seniors should be at the back of the line when the dust settles, and none of us should be in line now.

 

[ripper1]

Hey, Mitt Romney wants to send every adult American $1,000. No age discrimination there.

Not sure what all the RMD's add up to, but if it reduces pressure to take the money and run, an RMD holiday might be helpful. Of course, some people have already taken theirs out, not sure how to make it fair. And some people have to take the money for living expenses.

Yeah, I like Mitt...there is a guy with integrity

 

[RunningBum]

We’re two weeks in and no one has lost anything unless they’ve sold more than standard withdrawal, that’s a self inflicted wound. And FI implies we’ve planned for the worst and hope for the best. Lots of people who will be hurt a lot worse than seniors in general. Many seniors should be at the back of the line when the dust settles, and none of us should be in line now.

+1. 2 bad weeks and the 4% guideline has gone to hell? Cash reserves are gone? Unless you are 100% equities (which is a bad idea for anyone without an income coming in to cover expenses), you should not have to sell stocks now.

 

[CRLLS]

We’re two weeks in and no one has lost anything unless they’ve sold more than standard withdrawal, that’s a self inflicted wound. And FI implies we’ve planned for the worst and hope for the best. Lots of people who will be hurt a lot worse than seniors in general. Many seniors should be at the back of the line when the dust settles, and none of us should be in line now.

I disagree.

1) Many seniors in general are not FI and also live paycheck to paycheck. Many of us here are not typical and are FI or at least think we are. Only time will tell for sure.

2) Some RE have pulled the trigger too early and were not well prepared for this. Because they may have made a poor decision doesn't mean that they should suffer and go to the back of the line. They still have bills and possibly children too to care for.

3) Perhaps a tax free IRA withdrawal up to some $ may make sense, not much different than skipping 1 years (hopefully) delayed RMD previously done but covers some of those RE but not into their RMD years (72 and above now) yet.

4) When things start to get better, the recovery can happen more quickly if everybody spends more, not just those who are in the workforce or recently forced out of the workforce.

 

[Midpack]

Yep, we disagree.

I disagree.

1) Many seniors in general are not FI and also live paycheck to paycheck. Many of us here are not typical and are FI or at least think we are. Only time will tell for sure. Almost all seniors have some income, e.g. Soc Sec, reduced cost HC if not other bennies. Many low wage earners and/or young workers are already losing work and will lose jobs outright, some with kids, and they have no nest egg to rely on.

2) Some RE have pulled the trigger too early and were not well prepared for this. Because they may have made a poor decision doesn't mean that they should suffer and go to the back of the line. They still have bills and possibly children too to care for. People who “pulled the trigger too early” and “made poor decisions” shouldn’t be anywhere near the front of the line IMO.

3) Perhaps a tax free IRA withdrawal up to some $ may make sense, not much different than skipping 1 years (hopefully) delayed RMD previously done but covers some of those RE but not into their RMD years (72 and above now) yet. We’re two weeks into the market downturn, way premature to propose ANY senior bailout. Should be all paper losses at this point. Odds are there will be a full recovery and then some even if it takes a while. Then what, a clawback?

4) When things start to get better, the recovery can happen more quickly if everybody spends more, not just those who are in the workforce or recently forced out of the workforce. Agreed, maybe that also means we should all share the sacrifice instead of looking for some way to prop up seniors, especially two weeks in...

 

[gwraigty]

We’re two weeks in and no one has lost anything unless they’ve sold more than standard withdrawal, that’s a self inflicted wound. And FI implies we’ve planned for the worst and hope for the best. Lots of people who will be hurt a lot worse than seniors in general. Many seniors should be at the back of the line when the dust settles, and none of us should be in line now.

+1

Thank you. Just in the last couple of days, our Ohio governor has ordered many types of businesses to close either partially or completely. Many people are being thrown out of work, maybe temporarily, maybe permanently. The list of closures increased today to include such places as gyms, movie theaters, rec centers, bowling alleys, indoor water parks, and trampoline parks.

I disagree.

1) Many seniors in general are not FI and also live paycheck to paycheck. Many of us here are not typical and are FI or at least think we are. Only time will tell for sure.

2) Some RE have pulled the trigger too early and were not well prepared for this. Because they may have made a poor decision doesn't mean that they should suffer and go to the back of the line. They still have bills and possibly children too to care for.

Big difference. At least seniors aren't having their Social Security checks and pension checks suddenly taken away from them. Those will still be coming in. Someone who works in the Ohio restaurant industry, and any of the additional industries that are now being closed effective at the close of business today, doesn't have that same advantage. They didn't decide to have their hours slashed to nothing or practically nothing. They're not leaving work voluntarily. It's being forced upon them with literally a few hours notice.

Do you understand that seniors are in large part the reason these working class folks are now being put out of work? Non-essential businesses in many states are now being forced to close to protect the seniors and other vulnerable members of society.

Today the governor outright said that 65 and over, pregnant women, anyone with health conditions should stay home. Of course, how many will do this? This is why every day more and more types of businesses are being ordered to close. If there's no place to go, then it forces people to stay home.

No, seniors should not get to go to the front of the line. IMO, you shouldn't get in line at all.

 

[Fermion]

I agree that the IRA idea would be a horribly bad idea as far as perception goes.

The $1000 check mailed out immediately to every adult is direct money that doesn't have to fly through red tape and can help a family who just lost their job (probably doesn't even HAVE an IRA). As a side effect it will also help the seniors.

 

[ERD50]

I disagree.

1) Many seniors in general are not FI and also live paycheck to paycheck. Many of us here are not typical and are FI or at least think we are. Only time will tell for sure.

2) Some RE have pulled the trigger too early and were not well prepared for this. Because they may have made a poor decision doesn't mean that they should suffer and go to the back of the line. They still have bills and possibly children too to care for.

3) Perhaps a tax free IRA withdrawal up to some $ may make sense, not much different than skipping 1 years (hopefully) delayed RMD previously done but covers some of those RE but not into their RMD years (72 and above now) yet.

4) When things start to get better, the recovery can happen more quickly if everybody spends more, not just those who are in the workforce or recently forced out of the workforce.

Yep, we disagree.

And I agree with Midpack's disagreement!

Especially:

2) Some RE have pulled the trigger too early and were not well prepared for this. Because they may have made a poor decision doesn't mean that they should suffer and go to the back of the line.

Yes, it absolutely, 100% does mean they should have to 'suffer' (at least pay some sort of 'price' for their bad decision).

If there is no price to a bad decision, why bother making good decisions? It just makes those who prepared a bunch of suckers. Let's all retire early and draw 10% while we still have kids in school - no one will want to see us suffer, so I'm sure they will take care of us. Maybe a few posters here need to re-read the tale of the "The Ant and the Grasshopper"? Or it's adult version "Atlas Shrugged"?

-ERD50

 

[ivinsfan]

+1

Thank you. Just in the last couple of days, our Ohio governor has ordered many types of businesses to close either partially or completely. Many people are being thrown out of work, maybe temporarily, maybe permanently. The list of closures increased today to include such places as gyms, movie theaters, rec centers, bowling alleys, indoor water parks, and trampoline parks.



Big difference. At least seniors aren't having their Social Security checks and pension checks suddenly taken away from them. Those will still be coming in. Someone who works in the Ohio restaurant industry, and any of the additional industries that are now being closed effective at the close of business today, doesn't have that same advantage. They didn't decide to have their hours slashed to nothing or practically nothing. They're not leaving work voluntarily. It's being forced upon them with literally a few hours notice.

Do you understand that seniors are in large part the reason these working class folks are now being put out of work? Non-essential businesses in many states are now being forced to close to protect the seniors and other vulnerable members of society.

Today the governor outright said that 65 and over, pregnant women, anyone with health conditions should stay home. Of course, how many will do this? This is why every day more and more types of businesses are being ordered to close. If there's no place to go, then it forces people to stay home.

No, seniors should not get to go to the front of the line. IMO, you shouldn't get in line at all.

Are you serious about these comments? Wow.. I hate to tell you this but it's never been critical to have a restaurant anywhere ever. Not one person will die because they didn't get to dine out tonight.

Let me ask the 40 year olds, do you want the virus, do you want your kids to get the virus? Age has nothing to do with the protection of society as a whole. Sorry you are mad, but man you are over the top here.

 

[CRLLS]

Tough crowd!

 

[pb4uski]

IMO, way to early to be talking about bailing out anyone. Let's keep our eye on the ball of getting through this thing.

The sad reality is that most who lives paycheck to paycheck is going to suffer from a disruption in income... a consequence of not having any savings to fall back on... but people never seem to learn that it is imperative to save for a rainy day.

 

[Aerides]

Let's all dial it back a notch please....

The current population taking immediate economic pain is primarily hourly & tip dependent workers, gig workers, and small business owners and their staff.

Of course, airlines, hotels, and cruise ships - but a majority of their employees fall into the first category.

I personally like the UBI proposal, as I like a lot of the things in the current house plan, that seem to target those who will quickly fall into mortgage foreclosure, rent deficits, etc., far more quickly than any of us here.

The non-FI population likely would not benefit from any of the cap gains or IRA ideas floated here either.

I hope all efforts initially go to the folks most likely to have nothing in the bank already.

 

[pb4uski]

... I hope all efforts initially go to the folks most likely to have nothing in the bank already.

A part of me agrees.... especially for those who despite their best efforts to live within their means are getting hosed by the disruption.

But then that also means that those who are getting hosed by the disruption because they simply live beyond their means would also get bailed out... and I have no sympathy for them... IMO they should bear the natural consequences of their poor decisions.

I am not sure how we differentiate between the two... maybe based on income so assistance would be targeted to those with lower incomes.

 

[USGrant1962]

I agree that the IRA idea would be a horribly bad idea as far as perception goes.

The $1000 check mailed out immediately to every adult is direct money that doesn't have to fly through red tape and can help a family who just lost their job (probably doesn't even HAVE an IRA). As a side effect it will also help the seniors.

IMO, any "bailout" at this point should be targeted around unemployment benefits for those thrown out of work by this.

There is zero benefit to mailing checks to everyone, other than the newly unemployed who will mostly pay bills. What are people going to do with the extra money? Go to a restaurant, buy a plane ticket, go on vacation, attend a ball game or movie theater? Nope.

 

[teejayevans]

Don’t we already have programs in place for those lost their job? Unemployment isn’t something new.
Let’s solve the virus problem, then the economy will come back on it’s own.

 

[gwraigty]

Are you serious about these comments? Wow.. I hate to tell you this but it's never been critical to have a restaurant anywhere ever. Not one person will die because they didn't get to dine out tonight.

Let me ask the 40 year olds, do you want the virus, do you want your kids to get the virus? Age has nothing to do with the protection of society as a whole. Sorry you are mad, but man you are over the top here.

Yes, I am serious. I agree that no one will die if they don't get to dine out. I'm thinking of all the employees of those restaurants, of which DD is one. She's been through a lot the last couple of years with a medical issue and major surgery, then months of physical therapy learning how to walk again. She just got her job in November and was starting to build up her finances again. Now this. She got sent home not even half way through her shift on Saturday because it was so slow. She was supposed to work a 9 hour shift today and they called her yesterday to tell her not to come in until tomorrow. She was getting 40 hours a week and now she doesn't know what's going to happen going forward. She may still get some hours, but probably nothing like she was getting.

It was reported that over 500,000 employees in the restaurant industry alone in Ohio are now temporarily unemployed until further notice. With the new closings mandated today, increase that number. It's not like they can just go apply for a job somewhere else because, guess what...everyone else is closing, too!

Right now, it's gone from restaurants to fitness centers, rec centers, movie theaters, and other entertainment venues. No one will die from not being able to do those things either. Every day our governor is going to announce more and more closings until we have only places that sell food, medicine, gas, and provide critical healthcare and financial services open. It's already being done in some states.

Dentists in Ohio were told today not do anymore work that doesn't involve taking care of a pain issue or fixing oral functioning. No more teeth cleanings, whitenings, etc., because health care workers need the masks so badly. Vets aren't supposed to clean teeth either. There's going to be a mandate soon to cancel elective surgeries. On people, not just animals. The governor is working with medical professionals to come up with an exact list of prohibited procedures before making the order.

So I really could care less about a senior who thinks they should be entitled to some sort of bailout because of the market crashing.

No one wants this virus and it's ridiculous to suggest otherwise. I actually believe these drastic measures are worthwhile IF they accomplish the goal of making sure that seniors don't have to lose in a triage lottery. That's why this is being done and, IMO, an appreciation of the sacrifices that the working class is having to make might just be in order.

 

[gwraigty]

Let's all dial it back a notch please....

The current population taking immediate economic pain is primarily hourly & tip dependent workers, gig workers, and small business owners and their staff.

Of course, airlines, hotels, and cruise ships - but a majority of their employees fall into the first category.

I personally like the UBI proposal, as I like a lot of the things in the current house plan, that seem to target those who will quickly fall into mortgage foreclosure, rent deficits, etc., far more quickly than any of us here.

The non-FI population likely would not benefit from any of the cap gains or IRA ideas floated here either.

I hope all efforts initially go to the folks most likely to have nothing in the bank already.

I apologize. I made my next post before I saw yours. Thank you for your thoughtful comments and understanding of the situation.

 

[Markola]

Temporary moratorium on foreclosures and evictions if people have lost their income?

 

[jollystomper]

Temporary moratorium on foreclosures and evictions if people have lost their income?

That is what the governor has ordered in Maryland. Also, no shutoff of utilities, including cable TV and internet, for failure to pay.

 

[Fermion]

The UBI would be better than the moratorium because how does the over leveraged landlord survive if he is getting no rent and yet still has to pay utilities, taxes, do maintenance and eventually pay back the loans (even if he can't get foreclosed).

The temp UBI solves all of this.

 

[ERD50]

The UBI would be better than the moratorium because how does the over leveraged landlord survive if he is getting no rent and yet still has to pay utilities, taxes, do maintenance and eventually pay back the loans (even if he can't get foreclosed).

The temp UBI solves all of this.

Or unemployment pay? That system is already in place, and seems a good match. Lost your job, OK, here's some money for a time.

Maybe it needs tweaking to deal with this, but why start an entirely new program?

Small business owners (and large too I guess, but I'll assume they have a bit more inertia/resources to weather storms) are going to be in trouble. But a UBI isn't going to be large enough so they can pay their lease, utilities, and a bunch of ongoing expenses that can't just be turned off and on in short order.

That's going to be a tougher nut, I think.

-ERD50

 

[USGrant1962]

Don’t we already have programs in place for those lost their job? Unemployment isn’t something new.
Let’s solve the virus problem, then the economy will come back on it’s own.

Yes, but they are not immediate, and are cumbersome, bureaucratic, and limited. At least that is what I saw based on my trying to help my son navigate it when he was temporarily unemployed in Maryland a couple of years ago.

The QBI idea is interesting but it:

a) is not targeted.
b) is a new program that probably would never go away (so few new government programs ever do), and;
c) would largely go to people who don't actually need it.​

Anyway, the big problem in our face right now (resulting from steps taken to "solve the virus problem") is looming unemployment for hundreds of thousands, if not millions of hourly workers.

EDIT - I see as I was typing that Independent has shown there is action on this front. But, as noted there, unemployment compensation is state-run so it is up to each state to mitigate its own bureaucracy.