I was just making some changes to my blog site when the National Debt clock caught my eye. In less than 4 minutes, we added a million dollars to the National Debt. Now I am not sure exactly how accurate the calculator records the debt and if it is to the minute accurate, but it is inconceivable to me how quickly one million dollars goes!
Stop for a minute and watch the debt climb. Ask yourself, who is going to pay for this debt? Us? Our Children? Our Grandchildren? The answer... YES to all of the above!
One could debate the merits of what our government does for us and what entitlements we are "entitled" to. One could also debate the many financial handouts that immigrants receive when they come here, whether they become citizens or not; whether they ever pay a penny in taxes! But the reality is that our government is giving away the candy store and many of the entitlement programs may go away or drastically change in order to make up for the deficit! Who will pay for the debt?
Our government has contributed to the problem of rising debt and with every problem, they have a solution. Find another way to bring more money to Washington or to the State level... How? The easiest way is to simply raise taxes, right? Well, government has been cutting taxes recently to stimulate the economy, but spending has not been curtailed to equal the lower taxes. So, the debt continues to mount.
But our government has provided an answer for this too. It is called a qualified retirement plan! Take your pick, 401K, 403B, IRA, ... What they have done is suggested that we can put away pre-taxed money into these plans and pay the taxes later. Money managers will tell you that you will be making less when you retire, so you will pay less tax. The problem with this process is we no idea what the tax rate will be when it is time to pay the piper! We can certainly guess that if anything tax rates will be higher than they are today! The question once again, who is going to pay? And, how much will we pay? So do you think it might be better to pay the tax on the seed, the money you are putting away and then never pay tax again on that money? Uncle Sam doesn't! That is why there are qualified plans!
There are some exceptions to my objections to qualified savings plans, such as the Roth IRA, however, you are limited to what you can contribute from year to year. Never the less, it is something better than the traditional plans. The other exception is employer matched funds. If your employer matches your contributions, you might consider contributions to the maximum employer match. That is after all, free money! I would not contribute another dime beyond employer matches, however!
Finally, how much will your estate be worth? If you don't want to see a large portion of it taxed before your children and grandchildren receive their inheritance, protect those assets now or... guess who will pay?
A night of clarity will give you some insight into what I do and how we can assist you in obtaining financial piece of mind. To the right of this post, you will see the image. Click on it and register for the FREE seminar on how privatized banking really works. The time to protect your assets is now! The seminar is free and will help you in making informed decisions about your finances and how much of them will go to the payment of the National Debt!
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