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To: Charles Tutt who wrote (36518)	10/14/2000 3:47:34 PM
From: John Carragher	Respond to of 64865

With the income level phaseout, not sure what this means? agree with increasing ira deductions the kids sure need some way to save more money and avoid taxes. If you are around $100m I believe all tax credits for school and propsed tax credits under Gore are phased out. Here's an article I down loaded shows ira's are worth something to the rich. ( what is rich?) Stretching Your IRA into Millions A recent IRS ruling now allows IRA assets to continue to grow tax deferred beyond the lives of the original owner and beneficiary. As Lee Rosenberg, CFP at ARS Financial Services told viewers during his appearance on Power Lunch, this could help provide years of tax-deferred compounding potential for heirs and generations of IRA income. Below are descriptions of the two types of beneficiaries: 1.) Spousal Rollover. A spouse has the option of taking over a decedent's IRA as his or her own and naming new beneficiaries. The spouse may calculate Required Minimum Distributions (RMDs) from the new account based on a joint life expectancy with the new beneficiaries. Upon the death of the surviving spouse, assets may be transferred to these new beneficiaries. 2.) Non-spousal Beneficiary: The owner of an IRA may also designate a non-spousal beneficiary, including a minor. If RMDs haven't already started, the plan owner may establish systematic withdrawals based on his or her life expectancy. Then, when the plan owner dies, the original non-spousal beneficiary may name a new beneficiary. Thus, withdrawals may continue beyond the death of the original non-spousal beneficiary. Below is an example of a family that stretched an IRA using the two methods above: 1990: Client (age 55) rolls $200,000 into IRA and names his wife as beneficiary. 1995: Client dies, spousal beneficiary rolls over IRA as her own and designates her son as new IRA beneficiary 2000: Spouse dies and beneficiary (35 year old) begins payments based on single non-recalculated life expectancy. He names his wife as the beneficiary. 2040: Son dies, his wife continues the established distribution schedule. No rollover is available to wife. 2048: The IRA finally exhausts its assets. Total of $4,906,357 is distributed from the account. This assumes an 8 percent annualized return and that distributions are kept to the required minimum

To: Charles Tutt who wrote (36518)	10/15/2000 6:54:10 AM
From: JDN	Read Replies (2) \| Respond to of 64865

Dear Charles: "Instead of "privatizing" SS, why NOT just increase IRA deductions allowed? Wouldn't the effect be similar, with the degree of choice higher in IRA's? And it wouldn't require yet more rules." Heres the RUB on that arguement. According to various predicting agencies Social Security is going to go BUST eventually (dates differ dependent upon who is estimating). No ones plan to SAVE SS is adequate as the ONLY method of SAVING it is to increase the returns. It will NOT be politically possible to save it by putting more TAX DOLLARS into it as there just isnt enough money available. So, the answer is to get more RETURNS on the money that IS PUT IN. To do that they initiate a "Privatization Plan". Thats just a name, what it means is moving funds from low yield to higher POTENTIAL yield investments. We are not talking a big risk here IMHO as only a 1-2% increase in the yield over many years with MUCHO DOLLARS invested can and will result in much more money earned. It starts out quite small (I think Bushes plan allows you to invest 10% of your normal SS contribution in this PRIVATE plan) but I suspect over a long period of time and if it is successful the amount will gradually increase until SS as we know it is eventually phased out. What I cant understand is why ANYONE would be against it? Under the PRIVATE plan the money is YOURS FOREVER. To spend, to pass on heirs etc etc. Both my parents died at age 62 (we got $250 each to bury them) its still ONLY $250. All they paid in was lost. I would be SO HAPPY if only they would give me back the money I PAID IN over my lifetime and they can forget the whole damn thing for me. JDN