Today News

‘There’s a lot of room for tax increases’: Billionaire says America will need to change Social Security and cut Medicare to deal with worsening debt crisis – are you ready?

‘There’s a lot of room for tax increases’: Billionaire says America will need to change Social Security and cut Medicare to deal with worsening debt crisis – are you ready?

Hedge fund tycoon Paul Tudor Jones warned Americans of “significant fiscal problems” ahead.

The founder and chief information officer of Tudor Investments recently told CNBC’s “Squawk Box” that “there are obvious remedies” to the country’s economic problems $33 trillion debt crisis — but not everyone will like them.

do not miss it

Tudor Jones said many politicians in the United States often only consider one side of the equation – how to cut spending. He believes lawmakers are unwilling to consider an alternative remedy to the nation’s “significant fiscal problems” — “clearly raising taxes.”

According to the National Bureau of Statistics, the country’s tax-to-GDP ratio was 18.7% as of the end of 2022 CEIC data latest report —Significantly lower than the EU (26.8%) and the UK (27%).

“We have a lot of room to raise taxes,” Tudor Jones said During the interview.

But the support needed for any such idea is often hard to find in Congress. That may be especially true given that the House is currently in limbo as lawmakers try to appoint a new speaker and continue to clash over current budget issues — only narrowly avoiding an early October government shutdown.

If Tudor Jones is anything to go by—and with planned cuts and tax increases coming—here are some ways Ensure your financial security and minimizing the financial impact of any policy changes.

Figure out your Social Security benefits

“We’re going to have to make sacrifices. We’re going to have to cut spending. We’re going to have to deal with benefits. We’re going to have to change Social Security. We’re going to have to change Social Security,” Tudor Jones told CNBC. We’re going to have to limit Medicare and Medicaid. “

According to the U.S. Census Bureau, nearly 67 million Americans will receive monthly Social Security benefits by 2023, with benefits paid out for the year totaling approximately $1.4 trillion. Social Security Administration (SSA).

As of June 30, nearly 90% of Americans age 65 and older were receiving Social Security benefits, with federal payments accounting for about 30% of their income, according to SSA data.

But as Tudor Jones and some (mainly Republican) politicians have pointed out, maintaining the program is very expensive, especially given that the life expectancy of a 65-year-old is currently over 20 years old. Additionally, these costs are likely to increase as population increases.Americans in this age group are expected growth increasing from approximately 58 million in 2022 to approximately 75 million in 2035.

With this in mind, finding the best time can be confusing. Start receiving social security benefits.this The earliest Americans could begin to claim Benefit is 62, but if you claim late you will receive a higher monthly payment, and the maximum benefit is available to those who claim starting at age 70 or older.

While some Americans may believe they will not live long enough to take full advantage of the benefits they receive, others also believe Worried about running out of money for social security —As Tudor Jones suggested.

Keep in mind that, as things stand, waiting to collect Social Security will cost you a larger monthly payout, which will come in handy if you’re an estimator 15% of Americans rely solely on this benefit At least 90% of income during retirement.

read more: Faced with rising interest rates, millions of Americans are saddled with massive debt.The following is How to get your head above water as quickly as possible

Beware of Healthcare Costs

Four federal health insurance programs—Medicare, Medicaid, Children’s Health Insurance Program (CHIP) and Affordable Care Act (ACA) marketplace health insurance subsidies—account for 24% of the federal budget in 2023, according to the Medicare Administration. %, or $1.5 trillion. Center on Budget and Policy Priorities.

Half of that, $828 billion, would go to Medicare, which provides health insurance to about 66 million people age 65 and older or who have disabilities. Likewise, some politicians have repeatedly called for cuts in Medicare funding, but President Biden has pushed back with legislation to expand and strengthen the program.

As politicians debate the cost of health care, there are steps you can take to protect your financial security.

one emergency fund Can help retirees weather financial storms, such as an extended hospital stay or an illness when insurance or Medicare doesn’t cover the full cost.

Finally, if you’re covered by a high-deductible plan, consider Open a Health Savings Account (HSA) Helps you pay for out-of-pocket medical, dental and vision expenses. human serum albuminyou must deposit pre-tax funds from your paycheck, and then you can withdraw tax-free for qualified expenses.

Invest your money wisely

Last but not least, as federal funding of social programs comes under scrutiny, it is critical Save and invest your money wisely during your working life so that your finances are ready for retirement.

Tax-advantaged investment accounts, such as 401(k) or Individual Retirement Account (IRA) It’s a great tool to help you succeed.For example, a 401(k) allows you to deposit a portion of your salary into an account that you can access Invest and grow your money – and get tax breaks.If you’re still working, be sure to take advantage of any contribution match your employer offers, which is approx. As close to free money as possible.

You don’t have to be an investing guru to build a strong nest egg for retirement.You can start small Invest your changeor you can make your money work over time in any number of ways Investment Apps Or a crowdfunding platform.

Remember to diversify your portfolio (and ultimately your retirement income) through traditional stocks and bonds or other means alternative assets like real estate It will also help you set yourself up for success in retirement—regardless of any future welfare reforms or social program cuts.

What to read next

This article provides information only and should not be considered advice. This article is provided without warranty of any kind.

Source link

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button