Unsustainable per GAO

[mhende2]

GAO paints a rather bleak future for US if things don't change. I'm still hopeful some non political folks with real economics common sense step up and take away Congress Credit Card to get this mess under some meaningful control. Appears very few people ever see these reports, and even less care.

https://www.gao.gov/americas-fiscal-future

[Aitrus]

I've always like the GAO and their approach. Unfortunately, they rarely ever get listened to.

[bizkikr]

It will only matter when it's too late and can't be ignored anymore. Unless there's a new generation to replace all the old people in power to make a stark PIVOT.

There are examples of crazy being in control to serve as examples.
Look at Turkey, the PM thinks he knew best. Check this article from early 2022:
https://www.economist.com/the-economist ... s-it-seems
And now a U-turn:
https://www.politico.eu/article/end-rec ... inflation/

[bloobs]

It will only matter when it's too late and can't be ignored anymore. Unless there's a new generation to replace all the old people in power to make a stark PIVOT.

There are examples of crazy being in control to serve as examples.
Look at Turkey, the PM thinks he knew best. Check this article from early 2022:
https://www.economist.com/the-economist ... s-it-seems
And now a U-turn:
https://www.politico.eu/article/end-rec ... inflation/

Another lesson in politics that is oft repeated but never heeded. Politicians (and most managers I know) almost always make decisions on what will make/keep them popular now. Little concern about consequences tomorrow.

[Aitrus]

It's all good food for thought. What does it imply for our TSP investing / retirement planning strategies?

[bloobs]

It's all good food for thought. What does it imply for our TSP investing / retirement planning strategies?

For me, it implies that "reversal to the mean" phenomena happens a lot in stock markets and in the greater economy. It's human nature to do this. Meaning I will stay on the lookout for any market or economic indicators flashing an extreme reading whether extreme up or down. This would indicate that a whiplash to the opposite extreme end follows.

So many examples of these (threats or opportunities) readings of late to keep watch:
- Used car price index
- Lumber prices
- Volatility indices
- Real estate prices/affordability indices
- P/E ratios
- Interest rates

[mhende2]

When I posted this thread, My intent was to point out no matter what's coming out of media and Washington about how great the economy is coming back, inflation is getting under control, soft landings, and beating back chance of a recession, the GAO report I included link to, did not paint any such rosy picture.

I'm 69, retired, and my tax bracket is lower now. Those who are still working need to think about the probability of much higher tax rate coming in the near future to pay for the past government massive overspending when interest rates were low. Now the government debt will need to be paid back at greatly increased interest rates. Something will have to give soon, and in my opinion, that give is going to come from the working taxpayers wallets, because Washington doesn't know what a balanced budget looks like as most family budgets have to balance. Maximizing Roth investments annually will be even more wise when tax rates likely rise.

I've been converting my Fidelity and Schwab 401K investments over past 3 years into my Fidelity Roth account in small amounts that keep me below the next higher tax bracket, and not affect my Medicare premium. This year I'm beginning to roll my tsp differed tax investments into my Fidelity Rollover IRA, then I will convert as much as possible to the Roth while remaining within my current tax bracket. My intent is maximize my conversions into the Roth so I don't turn over higher taxes in the future when the tax rates will likely be higher. I'm trying to convert as much as I can before I must start taking RMDs at 73. There's also the chance the backdoor conversion to Roth may be slammed closed in the future. Decreasing the amount of tax deferred investments decreases the required annual RMDs, which could be at a higher tax rate. Paying the tax now as I convert to the Roth, will allow my investments to grow tax free, and I won't be forced to take any RMD from the Roth account.

We all have different goals and methods of reaching the goals. Mine is to limit my future taxes, while continuing to build my investment balance. I am fortunate not needing to withdraw any of my investments at this time, and I hope to continue that path as long as possible.

[Scarfinger]

Sounds like you got your finances under control and making sound investment decisions. I read that for most people Roth conversions are most beneficial in the 1st 10 years of retirement to give it more time to grow. The the benefits lesson the closer you get to your death age for money you plan to use for yourself.

[bloobs]

Does anybody have or know of a spreadsheet or some template that actually tracks and quantifies all these either/or calculations? These concepts and strategies are helpful and all but does someone actually track to verify and validate all this based on their own empirical data? That would be an amazing tool.

[Tomanyiron]

I've Been Looking but Still Haven't Seen Anybody Wearing a Build Back Better Hat!

[jimcasada]

I've Been Looking but Still Haven't Seen Anybody Wearing a Build Back Better Hat!

Must not be looking to hard... I see where both Amazon & Walmart carries them in a wide selection of colors (you could say about every color of the rainbow). What color would you like? One size fits all too!

https://www.walmart.com/ip/Build-Back-B ... USEALw_wcB

[Tomanyiron]

I've Been Looking but Still Haven't Seen Anybody Wearing a Build Back Better Hat!

Must not be looking to hard... I see where both Amazon & Walmart carries them in a wide selection of colors (you could say about every color of the rainbow). What color would you like? One size fits all too!

https://www.walmart.com/ip/Build-Back-B ... USEALw_wcB

"Haven't Seen Anybody Wearing a Build Back Better Hat!"

[mjedlin66]

I've Been Looking but Still Haven't Seen Anybody Wearing a Build Back Better Hat!

Watch it with the politics, Tomany.

[mhende2]

I pulled the lever and rolled my tsp over to my Fidelity Rollover IRA as I stated I would earlier in this thread a couple weeks ago.

I have no regrets of investing in TSP throughout my working career, I ended up with far higher balance than I ever imagined I would attain. Now that I'm retired and able to spend time managing my own investments in what I want, and make changes as often as I want, the decision was the right one for me.

My advice; invest as much % as you can, and increase it a little more when you can, but never ever reduce the percent you invest. If something needs to be reduced, make it your monthly spending not your investing. When retirement finally arrives, you'll be some happy you followed that path.

I intend to keep my tsp center and tsp calc accounts active and check in at least once per week. I like to read the forum posts, and check the data and charts.

Best wishes to you all

[Aitrus]

Congrats, mhende2, and glad to have had you with us. Thanks for the parting advice and thoughts.

Looking forward to hearing from you now and than.