Don't Ignore Your Biggest Lifetime Expense: Taxes
There is one major problem that everybody ignores, yet I think that this is the greatest cost over any individual’s lifetime and the greatest risk to the American people and the American way of life: taxes. I encourage you to understand the true history of the tax code in America, where it comes from, why it’s there, and how it’s hurting the American people. It’s not about taxing the rich versus taxing the poor — that’s just political fear-mongering in the media. The reality is that taxes are taking from one person against their will and giving it to another. Personally, I’d rather make that choice myself and call it charity. But by constitutional law, the government can now come at you with guns and take your money from you just because they think somebody else should have it. It’s wrong and it’s immoral. Unfortunately, we have to deal with it for the time being.
What the majority is unaware of, though, is that all the increases in healthcare have caused two problems. The first is that the older, aging population — the non-working, non-producing population — is living longer. They’re not dying when the government thought they were going to die when they implemented these plans like Medicare, Medicaid, and Social Security. The reason the corporate pension system doesn’t work anymore is that companies couldn’t afford it. People weren’t dying, and they had to keep paying them. They ran out of money and then went bankrupt. The government had to pick up that bill. So they invented the 401(k) system, because they’re thinking, “Aha! If we get people to not pay taxes now, we’ll get them to save for 20-30 years. When they have much more money, then there’s all our tax revenue later on.” Don’t you see what they did there? Some kind of “retirement planning,” it’s not a benefit to put money into a retirement account. It’s a place to leave it until the government gets our taxes later. That’s why it’s called tax-deferred.
Living Longer is Costly
The second problem is that this same old age group is causing Medicare, Medicaid, and Obamacare costs to go up, so Social Security costs go up. These things are unfunded liabilities; there isn’t a big pot of money in the government that’s funding these things. No, they’re bringing that money in from the taxpayers. So if the older population is living longer, then we’re having to fund these benefits real-time with current tax dollars from the younger, working population. But we’re not having as many babies anymore as we used to, so the older, aging population is getting bigger and the younger, working population is getting smaller. This is a major demographic problem, and nobody’s addressing it, we’re just kicking the can down the road. So if all your money is in accounts that are taxable at some point, the government is eventually going to have to raise taxes. There was a time in history when the tax bracket was at 90%.
As a veteran myself, I have no problem giving and being charitable to others, but I’m not going to do it at the force of Uncle Sam. Veterans didn’t sign up to serve the government, we signed up to serve our country. If veterans know there’s a better way to be a steward of their money, then they can choose how they create wealth and abundance, probably create more jobs, and be able to give more to charity versus paying taxes to a government that is going to inefficiently filter it off to pay for programs and rising health care health costs and social security benefits that are poorly managed.
Our current situation cannot last, and veterans shouldn’t be the ones passing it on to future generations. We can change this, but it’s up to us because we’re the only ones that understand true teamwork, and community, and can communicate and continue to lead. Remember, we were also paid by taxpayers to serve. Therefore, veterans have a unique opportunity to be better stewards of those tax dollars and not just get stuck in the same trap.
There are many limitations to traditional financial products if veterans want more than a standard retirement and the inevitable last-minute planning for their transition out of the military. And they can’t just leave money in the bank or under the mattress because of inflation. That money will lose value because the cost of goods goes up. We all know that a house costs a lot more money than it did 10 to 20 years ago — that’s inflation. Cars cost more, gas costs more, food costs more, everything costs more. If veterans are not growing their assets, they risk literally running out of money because they can’t afford things anymore. That’s not creating wealth. That’s having a poverty mindset. And veterans deserve more than to live paycheck to paycheck.
Diversify Your Tax Basket
Unfortunately, the financial industry makes so much damn money, they don’t bother to innovate. Financial advisers continue to churn clients through the old products and solutions, managing money and talking about accumulating assets. “I can beat your stock returns.” Or as a tip on retirement saving, “use retirement saving vehicles first.” Sure, there’s nothing wrong with putting some money in retirement savings vehicles, but if that’s the only place you’re putting money, then you’re putting all your eggs in one basket. If I haven’t made myself clear yet, veterans deserve more than the standard retirement. It’s time to diversify.
Fortunately, there are other options for military service-people. Just like Tesla and Netflix are changing the way we’re driving cars and watching movies, the financial industry has created new vehicles in which Americans can invest money.
Call us at US VetWealth today to find out how.
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