Home > Everything's getting more expensive

Everything's getting more expensive

June 17th, 2024 at 12:25 pm

What the hey. This site is just not monitored, and as a result is flooded with spammers, like the automotive manufacturing post.

I hope everyone had a good Father's Day, and hugs to those who cannot celebrate with their fathers. As I've gotten older, I realized how time with loved ones is fleeting. Most years now, there's a little dread associated with Mother's Day, and someday not in the distant future, Father's Day will feel the same way. Not to sound morbid, but it's one downside to getting older that no one ever warned me about.

I hadn't planned anything in advance with my father as I wasn't sure if he was spending time with his son or other daughter. This is how it goes in a family affected by divorce, remarriage and new families; it's hard to merge all together when you didn't really grow up together (and live in different states). At the same time, I didn't want Dad to be alone, so I did talk to him the day before to discover he had no plans. (His son had come up to see him a few days earlier.) So we went to a restaurant I didn't think would be busy because it's pretty much diner food, and I was right. The food was just okay, but we sat outside in perfect weather and enjoyed some good conversation.

On the way home, as I often do, I pulled over by a large pond (sometimes it's just some quiet wooded area or open space) and we continued talking in the parked car with the windows down. I often read things to him from my phone as Dad can't see well. He loves history, so I found a chronology of interesting articles about each of our American presidents, starting with George Washington. Yesterday we finished with Lincoln, so we are making our way through the list. We've been talking a lot about slavery, John Brown, Harriet Tubman.

I find that these seminal events and historical figures are much more meaningful to me when put in the context of my own family history. I've done a lot of genealogy work. My own great-grandparents were born around the same time as the American Civil War, all coming from poverty-stricken regions like the former East Germany, Northern Ireland and Galicia in Austria-Hungary, all coming to America in search of better economic opportunities. Just understanding that in the same timeframe, black people in America were still abused and treated as chattel, even after the war ended, what would otherwise seem like ancient history hard to fathom really comes alive.

It can be hard coming up with activities and experiences I can share with my father, given his physical disabilities. Eating out at a nice restaurant and going for drives are really the main ways we spend time together.

I had plans to join friends at a local vineyard for a casual, outdoor meetup with wine and good conversation this past weekend, but the woman organizing it cancelled it due to some predicted storminess. (It's been rescheduled in 2 weeks' time.) Instead, the 4 of us got together for dinner the following night, when the weather was again picture perfect. We met at a Nepalese restaurant I'd been to with my father twice. The food was great, the service excellent and prices reasonable. We will all meet up again at the vineyard with possibly more women from the online women's group we all came from.

Next weekend I'll be taking another friend out for a belated birthday breakfast.

I continue to be active with my 3 volunteer groups. Our next litter cleanup with the one group is in a shoreline town an hour-and-a-half drive from me, so I've decided to make a day of it and squeeze in one or two other activities/things to do on the drive home since the litter cleanups only take 2 hours.

Bills, bills, bills. I should be getting my hefty property tax bill any day now. It's the 1st of 2 annual payments, each about $3,500. Then my car and homeowners insurance will be coming up for renewal in another month. I've held off renewing my umbrella policy because I suspect I'll want to have my agent shop around for better prices on the car/auto, and they're all linked together. My car needs a bit of maintenance, a few hundred dollars worth, which the guy said could wait til my next oil change at summer's end. So I've deferred that. The guy who mows my lawn raised his prices again, effective July 1. Which irks me, since he raised his prices last year. I doubt I could find anyone cheaper so I'm just gonna have to bite the bullet.

Somehow I have gotten through the first half of the year solely on my annuity and dividends from 3 of my Vanguard funds. I didn't think this would be enough, but none of my one off big bills like the ones mentioned above occurred durning the 1st half of the year. I will likely have to take a distribution to pay the property taxes.

Next year, I plan to buy a new vehicle to replace my 11-year-old Honda. I will need to withdraw about $30K either from traditional IRA accounts, which will be taxed as income, or from a taxable brokerage account, which is not (right?) So I guess funding the car purchase with taxable monies is the way to go. Keeping track of how differenet types of savings/withdrawals are taxed can be confusing.


8 Responses to “Everything's getting more expensive”

  1. Turtle Lover Says:

    I too wish the site was monitored not because I post but because I love this site so much and I know it makes people go away .... I'm still here! 😊 I'm reading!
    That is nice that you get to spend time with your dad.
    I hope you still post when you can!

  2. Dido Says:

    Just a quick response now, more later...If you have to sell securities in your taxable brokerage account and there are gains on the sale (and you don't have any prior year loss carryforwards to offset them), that is what will be subject to tax.

    It is definitely a more tax-efficient way to get money in the short-term.

    And remember, you DON'T want your taxable income to be a negative number--that's throwing away the benefit of deductions.

    That said, this year and next are the last two years for the Tax Cuts and Jobs Act to be in effect (so far as we know)....but if either Democrats win both legislative bodies OR we have a split, the chances are that the TCJA sunsets in 2026, so it would be a reasonable year to get your income up to the top of the 22% or even the 24% bracket with IRA draws or Roth conversions, so taking the car money from the IRA is not a bad choice either, assuming that your future tax bracket is higher (most likely 25% if we return to the pre-TCJA system).

    Personal responses later.

    How's Luther?

  3. Dido Says:

    I'm glad you were able to spend time with your Dad on Father's Day. Still having him in your life is a blessing.

    There are read-aloud apps your Dad could use to save the strain on his eyes. I do a lot of "reading" by buying Kindle books and having the Alexa app read aloud to me, but there are also apps like Speechify that you can use to read anything on the internet.

    Insurance prices have been going up all around. I've seen it in the client policies I review and on my own. Climate change is beginning to have an effect, plus also we still have prices on cars that are inflated relative to what they were pre-pandemic.

    So you have some ancestors from Galicia? My ancestry is 100% from that area--3 of my 4 grandparents were born overseas (and my grandfather's older siblings were born there too).

    Sounds like you are having some nice social get-togehters.

  4. patientsaver Says:

    Much here to ponder and consider.

    Turtle Lover, thank you..glad you're still reading. It's amazing when I think about how long I've been on this site, too.

    Dido, thank you for the great suggestions. Years back I started getting dad books on tape from US Library for the Blind (most states participate, I believe). They mailed a book on tape player (looks like an old cassette player), and periodically I'll order over the phone usually around 10 titles that I think will appeal to him. Mostly history.

    They mail the cassette(s) and he can keep them for quite some time...3 months or something like that. When he's done, they give you a postage paid label and you just drop it in the mail. He loves this program and actually said the other day he wished he knew about it when he was in school becus he probably would have read more! Of course he couldn't have done so since his vision was fine then.

    How interesting about the Galicia connection. I only really solidified this knowledge fairly recently. This is a large area and one that changed hands many, many times. As you may know, Austrian Galicia became part of the Austrian Empire in 1804. (Prior to that it was part of Poland. From 1867 to 1918 it was part of the Austrian-Hungarian empire. After WWI ended, it was part of Poland again. After WWII, borders changed again and it was divided between Poland and Ukraine.

    My maternal grandfather's father was born in Galicia but in some of the censuses it simply states Austria. He was born and married his first wife in Austria, where they had 2 sons. Sometime after that his wife died, and he and his sons emigrated to Poland. (Or perhaps borders simply changed....really difficult to figure out just where they were.) In Poland he married a 2nd time, and the whole family emigrated to NYC, where they had 5 sons, one of them my grandfather.

    I actually have a wonderful family portrait of my grandfather's entire family, including his 2 half-brothers, parents and 4 brothers.

    Thanks for the car financing advice. But if I get my income up to top of 22% bracket, that's $100K, and wouldn't that possibly affect me vis a vis IRMAA and higher Medicare premiums? I would want to avoid that.

    Luther is actually doing better. At my suggestion, we changed the medication and it worked.
    I feel like my other vets failed me. It was such a simple and obvious possibility. So now I'm in the process of weaning Luther off the prednisalone, which is going to take months since he was on them for such a long time.

    I am not saying he has stopped coughing completely, but he's substantially better now, and the pollen count has been sky-high.

  5. Lots of ideas Says:

    If you have to withdraw from a taxable account to purchase a car, you might be better off if there is 0 % financing to stretch it out.

    $30,000 in a lump sum might put you into a higher tax bracket, but $5000 per year for 6 years might not.

    Math is so fun!

  6. Dido Says:

    Oh, I'm SO glad to hear that Luther is doing better!! That is wonderful!

    As for IRMAA, it will kick in at $103k. It's a cliff adjustment, so you want to leave some room for error. The most likely income surprise is capital gain distributions from any mutual funds you have in your taxable brokerage account. You will find the 2023 amount in Box 2a of your 1099-DIV (included in the Consolidated 1099) from that account. The 2023 number will give you SOME idea, but the thing about these distributions is that they can vary a lot from year to year. Funds do issue estimates beginning in October, but the actual distributions typically come in December. Kicking yourself into Tier II for IRMAA would add around $900 a year (but that's 2024 numbers)--and remember that IRMAA is based on your income two years PRIOR, so when your Medicare starts later this year, there would be no effect. Income changes in 2024 affect your 2026 premiums, and there will be additional inflation adjustments by then, so Tier II might begin at something like 109k. We don't know the 2025 IRMAA tiers until around October, and won't know 2026 IRMAA until October 2025.

    When I was growing up, I was always told that our family was from Austria because of that history--it was indeed the Austria-Hungarian empire when my family left around the turn of the century. It wasn't until I was in high school and did some research about the area where both of my grandfathers came from (Przemysl, pronounced SHEM-a-SHUL) that I figured out why they said Austria when the city is in Poland now).

  7. patientsaver Says:

    Thanks, Dido.

    I did take a peak at last year's 1099R for these 2 taxable accounts. This is basically "leftover" savings after maxing out my 401k and IRA contributions over the course of my work life.

    Balanced Fund: Ordinary dividends: $1628; Qualified dividends: $847; Cap gains: $1390.

    International Equity Index: Ordinary dividends: $2546; qualified dividends: $2058; cap gains: $0

    In 2022, the figures were somewhat different but it's possible that's because I adjusted my asset allocation.

    Seeing this, does this tell you more clearly which fund(s) you might withdraw from for the car? Perhaps I could withdraw part of it this year and part next year as some have suggested to buffer impact on overall income.

  8. Dido Says:

    Moving this conversation to email

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