Home - HumbleDollar

Costa Rica: The Richest Man On The River

Andrew Clements | Jul 22, 2026

"Thanks for the nice story Andrew, We spent a few weeks in Nosara, on the Pacific Coast, with our son and family. The trip form the airport took several hours, and went through fairly modern towns, rural areas, and across a mountain, much of it with our paved roads. Nosara is a great town, internationally know for its surfing and yoga instruction. It attracted interesting ex-pats from all over the world, looking for the Pura Vida. The local people were wonderful. One night we had a driver take us to a mountain top restaurant, driving some crazy dirt roads. He picked us up later and drove us home. I paid him in local currency and he told me it was far too much and tried to give some back to me. I explained I admired his driving skill and thanked him for transporting us safely. He reluctantly accepted what was not a big tip by US standards. I would love to go back sometime."

- Rick Connor

One Person’s Luxury, Another’s Necessity

Mark Crothers | Jul 21, 2026

"My mother-in-law was a model of frugal living. When her health issues qualified her to live in an assisted living facility paid for by her long term care insurance, she had no problem moving several states to a facility near her already-retired oldest son. Her favorite amenity was the free ice cream bar on her floor. True to her nature, she never overdid so she didn’t gain weight. She died of a pulmonary embolism just six days after she had dined in a nice restaurant with all her children and grandchildren to celebrate her 90th birthday. God bless Thelma Grady who showed me how to live a good life in retirement! 😊. P.S. Now that I can no longer send my all-access Sirius XM to my Bose Soundtouch receiver (presets no longer supported by Bose) and Sirius won’t give this 18-year subscriber a free receiver, I can’t think of anything else that I couldn’t live without. Not renewing Sirius XM. Will try something else."

- Linda Grady

Buying a car in retirement

Julie C | Jul 11, 2026

"I have seen very few Crown vehicles on the road . Do you like it? I believe it is the replacement for the Avalon , which was a very good car."

- Julie C

Fear of the Unknown…

gnussen623 | Jul 22, 2026

"It’s not surprising that so many HD readers at some point considered a second career as a financial planner. I too considered becoming a CFP. Two things stopped me: 1) I am not comfortable with sales, 2) I figured I would use simple index funds as the basis for my clients’ portfolios, and teach the client how simple investing had become, but thought no one would pay for that. Lo and behold two decades later financial planning is utilizing these types of portfolios and concentrating on the rest of financial management, not picking stocks."

- DavidHLancaster

Lessons on the Ground

ArticleDennis Friedman | Jul 18, 2026

THE OTHER DAY, WHILE walking to my mailbox, I noticed a summer class schedule for a private gifted youth academy lying on the ground. I assumed it belonged to one of my neighbors, who has elementary-aged children. Their interest in extra academics didn't surprise me. Many families move to this area because of its excellent schools. Parents here clearly value education. On any given day, it's common to hear children practicing the piano or violin as you walk through the neighborhood. I admire parents who encourage their children to excel in school. But as I looked over that schedule, I found myself wondering about the lessons that aren't taught in a classroom. Coincidentally, another neighbor's son had just graduated from college and was preparing to begin his career. If he were my son, what advice would I give him as he stepped into adulthood? After some thought, I settled on five ideas. Invest to Build Wealth. The most reliable way for ordinary people to build wealth is to become owners instead of just consumers. Buying shares of businesses allows you to participate in the growth of the global economy rather than relying solely on a paycheck. The good news is that you don't need much money to begin. What matters most is time. Starting early allows compounding to work its magic, with investment returns generating returns of their own over many years. Be a Long-Term Investor. If I could offer only one piece of investing advice, it would be to keep things simple. Invest regularly in low-cost index funds and stay invested. Trying to pick winning stocks or predict market swings is tempting, but history suggests that patience usually beats prediction. I recently read a New York Times column by Jeff Sommer that made this point well. Long-term market returns are driven by a surprisingly small number of extraordinary companies. The problem, of course, is knowing in advance which companies those will be. Broad diversification through index funds allows investors to own tomorrow's winners without having to guess who they are. Even if you think you're smart enough to spot those superstar companies, holding onto them for the long haul is a rollercoaster. They can be incredibly volatile. I've learned that lesson firsthand. A few years ago, my wife and I bought a small position in Nvidia (NVDA). It represented only a tiny fraction of our portfolio, but the stock's wild price swings made us uncomfortable. We eventually sold our shares too early for about $112, and the last time I checked, it was trading at $204. Do I regret selling? Not really. The vast majority of our stock holdings remain in Vanguard's Total Stock Market Index Fund (VTI), which owns Nvidia along with thousands of other companies. That approach has allowed us to sleep well at night while still benefiting from the market's long-term growth. Cultivate Friendships. Money matters, but people matter even more. Looking back, some of the biggest turning points in my life came because of friends. One college friend, Chuck, helped me get my foot in the door at an aerospace company when I was a history graduate struggling to find work. That opportunity led to a rewarding career. Another friend, Steve, introduced me to the woman who became my wife. That single introduction changed the course of my life far more than any investment decision ever could. But those special bonds don’t happen by accident; they require making time for them despite a busy career. Good friends encourage us, open doors we never expected, and help us through life's inevitable setbacks. Those relationships are among the greatest investments anyone can make. Give Every Job Your Best. I learned the value of hard work from my parents. When I was growing up, my father routinely left for work before sunrise and often didn't return until evening, six days a week. At the same time, he and my mother managed a 36-unit apartment building. My mother prepared dinner for our family before leaving for her own job each morning, returning home in the evening with just enough time to spend a few quiet hours with my father before doing it all again. Watching them taught me that meaningful accomplishments usually require persistence more than brilliance. There will be phases in your life when long hours are unavoidable. During those times, give your work your best effort. A reputation for reliability and diligence has a way of creating opportunities that talent alone cannot. Protect Your Greatest Asset. For someone just beginning a career, the greatest financial asset isn't an investment account. It's the ability to earn a living. Poor health can quietly undermine that ability. Regular exercise may not seem like a financial strategy, but it helps protect the income that makes every other financial goal possible. I recently came across a quote from a doctor in the comment section of an article in The New York Times that captured this idea perfectly: "Exercise, by its effect on skeletal muscle, can in part preserve cognition, prevent depression, prevent cardiovascular disease, prevent diabetes, prevent some cancers, prevent osteoporosis, and preserve independence. And the list goes on. There isn't a single pill on earth that delivers all of those benefits." Taking care of your health isn't simply about living longer. It's about preserving your independence and giving yourself the opportunity to enjoy the life you've worked so hard to build. As I walked back from the mailbox, I hoped the child whose summer schedule I'd found would do well in every class. Academic success opens many doors. But I also hope someone teaches lessons like these along the way. Years from now, I doubt anyone will remember a report card or a test score. They'll remember the habits that shaped a life: investing patiently, working hard, nurturing friendships, and taking care of their health. Those lessons may never appear on a syllabus, but they can make all the difference. Dennis Friedman retired from Boeing Satellite Systems after a 30-year career in manufacturing. Born in Ohio, Dennis is a California transplant with a bachelor’s degree in history and an MBA. A self-described “humble investor,” he likes reading historical novels and about personal finance. Follow Dennis on X @DMFrie and check out his earlier articles

FIFA Financials

R Quinn | Jul 19, 2026

"Never spent that kind of money on a sporting event... but back in 1972 I drove my then-girlfriend, now my wife of 52 years, to Greensboro, NC, to see Elvis in Concert. Tickets were @$125 each. We were on the floor, center, 6 rows back from the stage. At the time, I was earning @$600 a month. Good investment. She married me."

- Mike Lynch

Go While You Still Can

DavidHLancaster | Jul 22, 2026

"Great article, and his website looks interesting. Thanks for sharing!"

- Dave Melick

Will Your Death Double Your Spouse’s Tax Bill?

achnk53 | Jul 15, 2026

"Catherine, As I have written before for my pension we decided to take the annuity option. The dollar amount in my account just over 100K, so less than 10% of our portfolio, so was not a big “bet.” Also since the pension was through a hospital that also included physicians my thought was the pension fund managers certainly did their due diligence when it came to picking the insurance company. We chose the 100% survivorship ship option since it did not change the monthly payout significantly relative to our income. One of us will have to live only 11.5 years to “get our money back.” If my wife lives to 100+ (her mother died at 103+, my parents 85), that means “we” will have collected for 35 years. It seemed like the right decision and that the odds we will collect way more than our investment. I know that is not the best way look at it as during that time period we are just getting what the hospital put in, minus potential opportunity cost of not investing the money. It’s funny that even though the monthly amount is less than 1K which does not come anywhere near what we spend, my wife gets comfort knowing that money is coming in each month."

- DavidHLancaster

A discussion on health insurance, premiums, profits and such- a 50 year perspective most people don’t want to accept

R Quinn | Jul 15, 2026

"Yesterday I read that Senate Democrats have introduced a bill that will cap out of pocket expenses for traditional Medicare to $5000 annually. To me that sounds like the beginning of the end of the Medigap product but they say it will make Medigap more competitive with Medicare Advantage. What do you think ? I suspect that eventually all of Medicare will be an HMO. In my opinion ,Advantage works well until it doesn't .I have two friends much older than I and we live in a state (Mass.) known for excellent healthcare. One of them has a group Advantage plan , which presumably is better than what an individual can buy . When she needed rehab she was sent to a 1 star facility at an unreasonable distance from home. An aide dropped her and they refused to take her to the hospital so she called 911 herself . Her daughter was able to get transferred to a 3 star SNF, the highest in her Advantage network, and closer to home In contrast , my friend fwith Medigap could choose his SNF (5 star) , within easy driving distance from home so that his elderly wife could visit without difficulty."

- Julie C

A Can of Worms

Dan Smith | Jul 17, 2026

"David, I sure think that's true most of the time, still, I've seen some exceptions that just leave me scratching my head."

- DAN SMITH

K-shaped Economy

ArticleAdam M. Grossman | Jul 18, 2026

A TOPIC THAT'S been in the news recently is the so-called K-shaped economy. Imagine a chart plotting the relative standing over time of those with higher incomes and those with lower incomes. Owing to a strong stock market and rising home values, the shape of the chart for those with higher incomes would extend up and to the right and has been moving increasingly in that direction since Covid. Folks with lower incomes, on the other hand, haven’t benefited as much from rising markets. Instead, they’ve had to contend with higher prices on key budget items, including housing, tuition and healthcare. For this group, unfortunately, a chart of their financial progress would extend down and to the right. Put these two charts together, and they form a K—hence, the K-shaped economy. Because this divide has been especially pronounced for young people, more parents are asking how they can help their children. But they aren’t always sure of the best way to approach this. You may have heard the story about the late Charlie Munger. Some years ago, a friend asked Charlie if he planned to leave his considerable fortune to his children. Specifically, his friend wondered whether too much wealth would impact his children’s work ethic. “Of course it will,” Munger replied. “But you still have to do it.” “Why?” his friend asked. “Because if you don’t give them the money, they’ll hate you.” On the one hand, this is funny, but it also gets at why this topic can be so difficult. In fact, I’ve often referred to it as the hardest question in personal finance. But it isn’t impossible. If you’d like to help your children—either today or as part of your estate—here are four questions I suggest considering as you develop your plan. 1. What problem are you most trying to solve? Some families are clear that they just want to help their children as much as they can today, to combat the challenges of the K-shaped economy. Other families are focused on the long term and just want to see their assets pass to their children tax-efficiently at the end of their lives. Both are reasonable objectives, but it’s important to have clarity on what’s most important to you as the first step. 2. To what degree do you value simplicity over tax savings? With the federal estate tax at 40%—and many states levying their own taxes on top of that—folks with assets above the lifetime exclusion often conclude that it’s worth spending virtually any amount on legal fees in an effort to defray that tax. But not everyone agrees. Other families see it this way: While estate planning strategies can be effective in reducing taxes, they can be costly to set up and to maintain. For that reason, other families decide to spend little or nothing on estate tax strategies. They accept that their estates might—and likely will—end up facing a larger tab at the end of the day. But, they argue, if their estate is large enough for the estate tax to apply, then by definition, their heirs will nonetheless still receive a significant sum. 3. Do you worry about the problem Munger’s friend highlighted? If you’re worried about impacting your children’s work ethic, then counterintuitively, it may make sense to start making gifts sooner rather than later. The key is to make modest gifts and to make them incrementally. When you start making gifts like this sooner, it can serve two purposes. As a parent, it gives you the opportunity to see how your children handle these smaller sums. Do they immediately head to Bora Bora, or do they save and invest the dollars they receive? Making gifts incrementally can also help the recipient. To the extent that the first—or the second—gift is spent frivolously, modest gifts provide children the opportunity to acclimate and hopefully to adjust. 4. To what degree would you like to control your children’s use of assets down the road? If you go the route of an irrevocable trust and plan to leave assets to your children as a bequest, you won’t have the opportunity to iterate in the way I described above. That said, you may still prefer to leave assets to your children in this way. The key challenge with trusts is how to structure the distribution provisions. Put too many restrictions in place, and you risk causing your children a lifetime of stress or, worse yet, resentment. But put too few restrictions in, and the trust assets could be spent unwisely and deplete too quickly. How can you thread the needle? There’s no single right approach, but here are four distribution strategies you might consider. Based on age or stage: You might stipulate, for example, that a child reach age 30 before receiving any funds. Or you might require that a child have finished college or be married before receiving funds. The benefit of this approach is that it doesn’t leave room for debate between your children and the trustee. The downside is that this sort of structure can be too rigid, because children’s needs don’t always align with specific ages or stages. The reality is that everyone takes different paths through life in ways that no formula can fully contemplate. I often reference the movie The Bachelor, which is a comedy but illustrates how an overly rigid structure can have unintended consequences. Annual percentage with no discretion: This structure also has the benefit of being straightforward, with no room for debate between beneficiaries and the trustee. In addition, a fixed percentage can help preserve a trust’s assets for many years. The downside is that children’s needs typically vary from year to year. They’ll want to buy homes and may have tuition expenses for their own children. For those reasons, a fixed percentage, while attractive in theory, runs the risk of being an obstacle to your children’s most important goals. Annual percentage with an override for specific needs: The benefit of this structure is that it provides flexibility if a child wants to buy a home or has other higher-than-normal expenses in a particular year. The downside is that it opens the door to debate between beneficiary and trustee. The trustee might deem a proposed home purchase too expensive, for example. Trustee’s discretion: A final approach is to leave distributions entirely up to the trustee. That’s the most flexible but also the most potentially fraught. If a trustee and a beneficiary don’t get along, this setup would give the trustee wide latitude to make the beneficiary’s life miserable for decades. No distribution structure is perfect, but it’s for this reason that I tend to recommend against this approach, common as it is. Adam M. Grossman is the founder of Mayport, a fixed-fee wealth management firm. Sign up for Adam's Daily Ideas email, follow him on X @AdamMGrossman and check out his earlier articles.

Many seniors think we paid for our Social Security benefits based on the FICA taxes we paid. Let’s dispel that myth- we didn’t

R Quinn | Jun 15, 2026

"It wouldn’t even have to be eliminated. Given data analytics today, it would be possible to track via tax returns spouses, young children, disabled children household income etc. SS tax could be modified to account for various life circumstances. There’s no need for one size fits all these days."

- Marilyn Lavin

Costa Rica: The Richest Man On The River

Andrew Clements | Jul 22, 2026

- Rick Connor

One Person’s Luxury, Another’s Necessity

Mark Crothers | Jul 21, 2026

- Linda Grady

Buying a car in retirement

Julie C | Jul 11, 2026

"I have seen very few Crown vehicles on the road . Do you like it? I believe it is the replacement for the Avalon , which was a very good car."

- Julie C

Fear of the Unknown…

gnussen623 | Jul 22, 2026

- DavidHLancaster

Lessons on the Ground

ArticleDennis Friedman | Jul 18, 2026

FIFA Financials

R Quinn | Jul 19, 2026

- Mike Lynch

Go While You Still Can

DavidHLancaster | Jul 22, 2026

"Great article, and his website looks interesting. Thanks for sharing!"

- Dave Melick

Will Your Death Double Your Spouse’s Tax Bill?

achnk53 | Jul 15, 2026

- DavidHLancaster

A discussion on health insurance, premiums, profits and such- a 50 year perspective most people don’t want to accept

R Quinn | Jul 15, 2026

- Julie C

Manifesto

Jul 22, 2026

NO. 11: A REGULAR paycheck allows us to save, service debt and take stock market risk. But we should also protect that paycheck with health—and perhaps also life and disability—insurance.

act

Jul 22, 2026

OPEN A ROTH IRA for your teenagers. Have they been mowing lawns or scooping ice cream this summer? If they have earned income, they’re eligible for a Roth, which you could fund solely out of your pocket or with help from them. At their modest tax rate, the Roth’s tax-free growth will likely prove more valuable than a traditional IRA’s initial tax deduction.

Truths

Jul 21, 2026

NO. 9: BIG SALARY increases, especially late in your career, can make it harder to retire. As your paycheck grows, you’ll likely raise your standard of living. That means you now need a larger nest egg to sustain that lifestyle in retirement. The problem: You were likely previously saving as though you were looking to replicate a more modest lifestyle.

humans

Jul 20, 2026

NO. 72: WE ENJOY working hard. We tell ourselves, “I just want time to relax,” and yet relaxation doesn’t satisfy us for long and we quickly grow restless. We should keep this in mind as we ponder retirement. Contrary to what we imagine, we get great pleasure from working, especially work we’re passionate about and that gives us a sense of purpose.

Money Guide

Manifesto

Jul 22, 2026

NO. 11: A REGULAR paycheck allows us to save, service debt and take stock market risk. But we should also protect that paycheck with health—and perhaps also life and disability—insurance.

Spotlight: Taxes

Tax Gain Harvesting

Bogdan Sheremeta | Nov 8, 2025

MANY PEOPLE ARE familiar with tax loss harvesting, where you sell a losing security/ETF and rebuy a similar, not identical, security/ETF.
But often we don’t really think about the opposite side of the coin: sell a winning security/ETF and rebuy the exact same, or a different, security/ETF.
That strategy is called tax gain harvesting, and because it’s a gain, the wash sale rule doesn’t apply.

Execution
Long-term capital gains can be taxed at 0% depending on your income.

Kitces – Analyzing Congressional Republicans’ Budget Proposal For The 2025 TCJA Extension

William Perry | May 1, 2025

On April 30, Kitces posted an comprehensive article regarding the Tax Cuts and Jobs Act (TCJA) describing in detail where the congress is currently at and what steps are necessary to extend and/or change the the TCJA before the current tax law sunsets at the end of 2025.
https://www.kitces.com/blog/tax-cuts-and-jobs-act-tcja-sunset-budget-resolution-reconciliation-salt-cap-qbi-deduction-congress-republication-house-senate-bill/
I agree with the conclusion of the article to currently “wait and see” before taking action until I have a concrete expectation of what the individual income tax rules will look like in 2026.

New Bonus Senior Deduction Impact

Rick Connor | Jul 16, 2025

The recently enacted One Big Beautiful Bill Act included a number of tax provisions of interest to HumbleDollar readers. Given the emphasis on retirement planning on HumbleDollar, the new bonus Deduction for Seniors has potential to provide a significant tax savings for seniors.
This has been discussed in previous posts over the last few weeks, but the details are worth a quick review. Taxpayers who reach 65 by the last day of the tax year, starting in 2025,

Roth Hidden Benefits

Bogdan Sheremeta | Oct 25, 2025

WHEN MOST PEOPLE think of Roth IRAs or Roth 401(k)s, they just think “tax-free withdrawals.” But that’s only part of the story.
Roth accounts can protect you from financial traps that catch many retirees off guard. Here are five key advantages to keep in mind:

1. Tax Rate Protection
One thing we can’t control is future tax rates.
Did you know that in the 1980s, the highest federal tax rate was 50%?

What to Know About The One Big Beautiful Bill

Adam Grossman | Jul 11, 2025

On July 4th, the president signed a significant new tax and spending bill into law. The text of the bill runs to almost 900 pages and affects nearly every corner of the tax code, including personal, business and estate tax rules.
Below I summarize the provisions I see as most relevant to financial planning. It’s important to note that many of the provisions are retroactive to the beginning of 2025.
The formal name of the law is the “One Big Beautiful Bill Act,” and it is,

Am I missing something? What happened to taxes?

R Quinn | Jun 24, 2025

As a result of reading HD, I have become fascinated with certified financial planner videos on YouTube, some are pretty good, others not so much.
Often one thing strikes me as ironic. Some presenters look more like they will be starting college in the fall, than experienced experts and none of them look anywhere near retirement age – maybe they will FIRE, but I digress.🤑
My real curiosity is when they show a spreadsheet to see if a hypothetical couple can afford to retire.

Back When

James McGlynn | Sep 25, 2020

I BEGAN MY CAREER in investments as a junior analyst at a public endowment fund. It was 1980 and I'd just finished my last investment class at college, where I learned about Modern Portfolio Theory. Why, decades later, is it still called “Modern”? The Dow Jones Industrial Average was below 1000, versus today’s 27000. Men wore suits in 100-degree Texas heat. We had individual offices. We researched companies by reading brokerage reports, talking to brokers and requesting annual reports from companies. Those requests were typed up by our secretary and mailed to each company’s investor relations department. The Wall Street Journal had just one section. There was no electronic version. Brokerage firms were happy to provide us with “free” proprietary research, since trading commissions were extremely high. The arrival of fax machines was a real game-changer in delivering those research reports, which could be hugely valuable. Regulation FD hadn’t arrived, so brokerage firms often obtained information that hadn’t been fully disclosed to the public. If we liked a brokerage firm’s trade ideas, we’d buy or sell through the firm and its compensation was the commissions earned. Twice a day, we could see stock prices on our Quotron machines, which also provided trading volume. A year or two later, our first personal computer arrived. This was before the internet. The only stock market TV program was PBS’s Wall Street Week with Louis Rukeyser, who broadcast from Owings Mills, Maryland. CNBC and Bloomberg Television were nowhere in sight. Pensions were commonplace, while IRAs and 401(k)s were only just taking off. I remember sending checks to Fidelity Investments since its money market funds paid north of 15%. This was the era when Salomon Brothers’ economist Dr. Henry Kaufman warned us that budget deficits would lead to higher interest rates and President Reagan’s Budget…

Early Decision

James McGlynn | Jul 21, 2020

DELAYING SOCIAL Security until age 70 will get you the largest possible monthly benefit, and that’s the right strategy for many retirees. But what’s right for many folks won’t necessarily be right for you—and you may want to file at 62, the youngest possible age, so you maximize your total lifetime benefit. If you’re single with no dependents, you should probably file at age 62 if you’re in poor health or your family doesn’t have great genes, and you don’t expect to live to age 80. Over this relatively short period, the smaller monthly benefit starting at age 62 will likely prove more valuable than waiting to get a larger monthly check. Similarly, if you’re single and have no other income to live on, by all means start Social Security at 62. In both instances—poor health or no other income—beginning at 62 should be the right decision, provided you don’t live into your 80s. If you’re widowed, there may also be good reason to begin Social Security at age 62. Survivor benefits can typically start at age 60 and won’t get any larger if you delay beyond your full Social Security retirement age, which will be 66 or 67, depending on the year you were born. In some instances, a widow or widower might start her or his own benefit at age 62 and then switch over to survivor benefits at full retirement age, assuming the survivor benefit is bigger. Alternatively, those who are widowed might start survivor benefits at age 60 and then claim their own benefit—based on their own earnings history—at age 70, at which point it’ll be at its largest, thanks to the delay. Whether you’re married or not, if you have dependents, you might be eligible for Social Security family benefits, on top of your own…

The Taxman Cometh

James McGlynn | Oct 23, 2020

LATE LAST YEAR, Congress voted to kill off the so-called stretch IRA, which had allowed those who inherited retirement accounts to draw them down slowly over their lifetime. Many folks were surprised by the stretch IRA’s demise, but they shouldn’t have been. When a tax break or some other government provision benefits only a few folks, Congress often changes the law. Think back to 2015. That year, Congress eliminated the ability to “file and suspend” Social Security—another strategy that tended to be exploited only by a privileged few. I suspect we’ll see similar Congressional action in the years ahead. This election season, there’s been talk of reversing the tax rate reductions in 2017’s Tax Cuts and Jobs Act (TCJA), especially for those who’ve benefited the most from those cuts. In any case, after year-end 2025, many of the TCJA changes sunset. The upshot: If Congress doesn’t act in the next five years, taxes will automatically increase. But it isn’t just the TCJA that’s in the political crosshairs. Here are five other key areas where we might see changes to the tax code: There’s discussion of eliminating the preferential long-term capital gains and qualified dividend tax rates for those with incomes above $1 million. Warren Buffett has often complained that he pays a lower tax rate than his secretary. This change would ease his conscience by boosting the capital gains and dividend tax rate from 20% to potentially 39.6%, but only for those with seven-figure incomes. The TCJA reduced corporate tax rates from 35% to 21%. There are proposals to increase that rate to 28% and to ensure all corporations pay a 15% minimum tax. I predict that, at some point between now and 2034, there’ll be changes to the payroll tax that funds Social Security or, alternatively, that other federal…

Don’t Get an F

James McGlynn | Nov 25, 2019

MEDICAL EXPENSES ARE a big worry for retirees—leading many to purchase supplemental insurance. But you need to think carefully about which Medigap policy you buy. What does this insurance get you? Medicare Part B, which covers doctor’s visits and other outpatient care, typically only pays 80% of the expenses that retirees incur. To plug this and other coverage gaps, many folks buy a Medigap insurance plan. Want to keep your current doctors and not be restricted to the network of medical professionals offered in a Medicare Advantage plan, otherwise known as Medicare Part C? You’ll want to stick with Medicare Part B and supplement it with a Medigap insurance plan sold by a private insurer. After signing up for Medicare Part B, most people have just six months during which they’re “guaranteed issue” for Medigap. “Guaranteed issue” means there’s no medical underwriting when choosing a Medigap plan. After those six months, you could be denied for health reasons. One potential pitfall: If you opt for a Part C Medicare Advantage plan when you’re first eligible for Medicare, you may forever be locked out of the Medigap market if you later want to switch out of Medicare Advantage. The reason: Your health may have deteriorated and you can’t pass the medical underwriting. How do you decide which Medigap plan is best for you? There are 10 different varieties of Medigap plan. In 2018, Medigap Plan F was chosen by 54% of all enrollees. While Medigap plans are standardized in terms of the coverage they provide, costs can vary significantly. Even though Plan F is the most popular, Plan G is the fastest growing—for good reason. Plan G is less expensive than Plan F. The only difference between the two is that Plan F pays the Part B deductible of $185, whereas…

He Gets, She Gets

James McGlynn | Dec 15, 2020

IF YOU DESIGNATE beneficiaries for your retirement accounts, that’s usually a surefire way to pass those assets directly to your desired heirs without going through probate—but not always. Because those beneficiary designations are so important, you should verify your choices every year in case there’s a change due to, say, marriage, birth, divorce or death. Especially marriage and divorce. Which brings me to a crucial issue: When dealing with IRA and 401(k) beneficiary designations, there’s a key difference when it comes to your spouse. In general, a spouse who hasn’t been named beneficiary of an IRA isn’t entitled to inherit it. Unlike 401(k) plans, IRAs aren’t governed by ERISA—the Employee Retirement Income Security Act—so these accounts don’t have the same protections for spouses. You’re free to name whoever you wish as your IRA beneficiary, even if you’re married, provided you don’t live in a community property state. Indeed, IRAs are excluded from ERISA coverage, even if the funds originated in a 401(k). By contrast, under ERISA, if the owner of a 401(k) account is married when he or she dies, his or her spouse is automatically entitled to receive money, regardless of what the beneficiary designation says. The exact percentage seems to be a matter of some disagreement—some lawyers say 50%, while others put it at 100%. If there’s no beneficiary listed, the spouse is entitled to 100% of the account. The spouse can sign a waiver, giving up his or her claim to the account, but only if the spouse is at least 35 years of age. It isn’t enough just to name someone else on the beneficiary form that your employer gives you. The waiver must be filled out, with the spouse consenting to the participant’s choice of beneficiary. If your spouse signs the waiver, which should be…

Tempting Fate

James McGlynn | Mar 13, 2022

ONLINE SPORTS BETTING is currently legal in 30 states but eventually will be legal everywhere—because the tax revenue is simply too attractive. All this was made possible by the Supreme Court, which in 2018 struck down federal legislation prohibiting online sports betting. The sports leagues spent decades denouncing gambling, saying it threatened the integrity of the game. But my concern isn’t the “integrity” of the game. Rather, I worry about the individual bettor who ends up wagering too much. Fortunately, I’m stingy when it comes to betting, which has kept me out of trouble. Forty years ago, when I would gamble in Las Vegas, I would limit myself to losing $200 per trip. I never inflation-adjusted my limit and still hold myself to that $200 limit. I thoroughly enjoy many types of gambling: craps, Kentucky Derby, March Madness, the Super Bowl and even betting on local college sports teams—when they have a chance at a championship. I may seem like a degenerate gambler. But the key for me is to bet in such small amounts that, even if I lose money, it’ll have zero effect on me. The NFL is putting out public service announcements, with Coach Steve Mariucci advising gamblers to “bet responsibly.” Still, many folks will likely end up gambling too much—because the temptation will soon be everywhere. The NFL is now partnering with DraftKings, the online sports company. I’m a regular viewer of sports talk shows, and I’m bothered by the gambling advertisements that surround the screen when I’m trying to enjoy the broadcasts. HumbleDollar readers are well trained to buy index funds, while only occasionally “gambling” a little on active funds. The same should be true for actual gambling. If you have a limited amount of entertainment dollars set aside for gambling, that strikes me as…

Costa Rica: The Richest Man On The River

One Person’s Luxury, Another’s Necessity

Buying a car in retirement

Fear of the Unknown…

Lessons on the Ground

FIFA Financials

Go While You Still Can

Will Your Death Double Your Spouse’s Tax Bill?

A discussion on health insurance, premiums, profits and such- a 50 year perspective most people don’t want to accept

A Can of Worms

K-shaped Economy

Many seniors think we paid for our Social Security benefits based on the FICA taxes we paid. Let’s dispel that myth- we didn’t

Costa Rica: The Richest Man On The River

One Person’s Luxury, Another’s Necessity

Buying a car in retirement

Fear of the Unknown…

Lessons on the Ground

FIFA Financials

Go While You Still Can

Will Your Death Double Your Spouse’s Tax Bill?

A discussion on health insurance, premiums, profits and such- a 50 year perspective most people don’t want to accept

Free Newsletter

Get Educated

Manifesto

act

Truths

humans

Money Guide

Manifesto

Spotlight: Taxes

Tax Gain Harvesting

Kitces – Analyzing Congressional Republicans’ Budget Proposal For The 2025 TCJA Extension

New Bonus Senior Deduction Impact

Roth Hidden Benefits

What to Know About The One Big Beautiful Bill

Am I missing something? What happened to taxes?

Spotlight: McGlynn

Back When

Early Decision

The Taxman Cometh

Don’t Get an F

He Gets, She Gets

Tempting Fate