$34,667,768,388,524 & Counting….

Written By: Anna Carlson

Something’s gotta give with our national debt. Bloomberg recently conducted a million simulations on the US debt outlook, and 88% of them show our current borrowing is on an “unsustainable path.” (Shocking, I know.)

Right now our national debt is nearing $35 trillion with no signs of slowing down. Current economic forecasts indicate it will balloon to over $54 trillion in the next decade. How does all this federal spending and borrowing impact your retirement, you may ask?

First, let’s look at the numbers. So far, in fiscal year 2024, the government has spent 3.25 trillion dollars, and has earned 2.19 trillion dollars.

Click here to see the federal spending broken down by category and agency. You can also click here to see where the federal revenue comes from, or I can sum it up for you in one word: TAXES.

To be fair, not all of the government’s revenue is generated from taxes. There is a category labeled ‘miscellaneous income”, and that has made up 1.72% of the U.S. revenue FYTD.

Back to the question of how this could impact your retirement. You may be thinking about investment returns in retirement, but it’s your retirement income that may need braced for the national debt’s impact. I’m going to (sadly) assume the spending isn’t reduced, so one of the most likely ways the U.S. will dig out of this financial hole is by increasing the revenue the government collects. I don’t want to start my weekend off by having to lay out how the government will increase their revenue, so I’ll let you connect the dots.

There are many reasons we could see higher taxes in the near future. Aside from the massive amount of debt our country has, we know the clock is ticking on our current tax rates. They expire at the end of 2025, so it’s not a matter of if but when taxes will go up.

One of the ways to help your money last is to seek out every opportunity to reduce your lifetime’s tax bill. We can help find ways to keep more money in your pocket, for your retirement, and for your heirs and loved ones.

Call us at (844) CARLSON, and we’ll review your retirement income and investments to help uncover what your possible tax liabilities are in the future. Then we’ll talk about some of the strategies that can help reduce your taxes down the road. It could be the difference of thousands of dollars each year that you & your family spend on whatever you’d like…or paid in taxes for the government to decide that for you.

Say What?

Masion taxes are on the ballot. How do they work?

The article highlights:

Some state and local governments are adding a so-called “mansion tax” onto local ballots.

A “mansion tax” is an additional one-time real estate transfer tax imposed on high-price property sales.
The higher tax rate is based on the property’s selling price, not its square footage or luxury features. Meaning the extra tax applies whether it’s a studio apartment or rivals Buckingham Palace, as long as the price is high enough.
Chicago voters recently rejected an extra tax on real estate sales above $1 million, but similar ballot initiatives in Los Angeles and Santa Fe, New Mexico have passed.
At least 17 U.S. cities and counties had so-called mansion taxes as of early 2024.

This week in history

1978 – “The Blues Brothers” make their world premiere on Saturday Night Live.

1982 – Jane Fonda’s first workout video was released.

1986 – The Chernobyl nuclear disaster occurred, resulting in 32 deaths and dozens more suffering radiation burns.