3 [Scary] Reasons Taxes Are Going Up & What The Government Won’t Tell You About It

Most people think they know where their tax dollars go, they worry about the “porculus spending” and wasted dollars on outlandish programs. While I agree there are some things that could be “tuned up”, the real reasons to be worried are far more frightening.

Now before I tell you exactly why taxes are bound to go up, take a look at exactly where your tax dollars go right now. This chart breaks down where $100 of taxes goes.

Where Your Tax Dollars Go

Pretty crazy huh? You might be surprised at how much goes to Social Security, Healthcare, and Defense.

Oh, and in case you didn’t do the math, or read the little note at the bottom, all the spending ads up to $124.50. Which means for every $100 of taxes that come in, $124.50 goes out.

We are already in the negative. I could essentially wrap up the discussion now, and you could see why government is going to need more tax dollars…

But it’s not just where they are going right now, what’s even more shocking is what the numbers don’t show, which are guaranteed to result in one of two things – higher taxes and more inflation (or both!). I’ll tell you why in a second, but first let’s take a look at this crazy chart.

The Scary Stats on Current Tax Spending

Most people are angry because of wasted tax dollars on ridiculous programs, but that’s hardly the issue. When compared against each other, Defense, Social Security, Healthcare, and Interest are our biggest expenses. Everything else seems like mere pennies.

In other words, what happens in these three areas will change your tax situation drastically… and you’re toast if you don’t prepare for it now.

You see, everything but defense spending is on the rise, big time! Which is why so many people with deep pockets are dumping tax strategies like 401ks, IRAs, and other “tax shelters” that just push off the tax burden to the future – when taxes have skyrocketed. It’s no wonder they’re dumping this strategy and purposely eliminating future taxes in accounts like the 500 account.

Why Social Security is the Biggest Ponzi Scheme in the World

Of all the problems we have, this should be top of the list. We have big issues, and I’m about to share them with you.

And if you’re wondering why I call it a “ponzi scheme” let me tell you…

Because it is!

When early investors are paid by later investors, it’s the epitome of a ponzi scheme.

Check this out. The first taxes for Social Security were collected in January of 1937. And it was passed as a way to help people “save” for retirement.

But guess what?!

None of those dollars went to fund retirement or “social security” account. It was spent elsewhere… all of it!

So today, when 23 cents of every tax dollar is spent on Social Security, it’s because government wasted all the money it originally collected, and now requires “new investors” (or new tax payers) to pay the first ones.

It doesn’t get more ponzi than that! And there’s 9.6 trillion dollars that needs to be paid over the next 75 years, none of which we actually have.

So where does that leave us?

Here’s a scary glimpse.

Straight from the Social Security Administration’s website (SSA.gov) “The ratio of workers to benefit recipients has steadily declined over the years. was 14 to 1 in 1950; 5 to 1 in 1960, and is currently about 3 to 1. A further decline to 2 to 1 is likely to occur over the next 50 years.” In short, for every person receiving social security, there used to be 14 paying. The load per person was pretty light. Now that’s down to almost 2.

And to top it off, life expectancy has gone from 58 (in 1937) to 79 (today), which means we have to shell out even more money because people are living longer.

In other words, Social Security needs a serious boost in tax dollars, and rest assured they will be looking for anyway they can to find them.

And while Social Security is presenting a serious need for tax hikes, it’s nothing compared to

The Healthcare Problem and 6% More Taxes

Whether you have realized it or not, you’re tax situation is already substantially different than it was last year.

It’s called the “Affordable Care Act” but most people just call it “Obamacare,” and it’s putting another 6% burden on We The People.

And it’s not even part of the (above) chart yet. That’ll be a fun surprise for next year.

What’s even more scary is the estimated cost for “Obamacare” has nearly doubled. While they estimated it at less that 1 Trillion originally, it’s now passed 2 Trillion, and still going up.

But the fact that we’re revising the Health Care system isn’t what concerns me most. It’s the fact that these dollars will likely go to satisfy more of our government’s insatiable spending. Just like Social Security, it will likely be money we need to find more of later.

I’m sure your kids will love the extra burden…

Now if you’re getting the sense that your tax situation will be changing, you’re right. Social Security and Health Care alone will take care of that (and already have), but hang on to your shorts, the ride’s not over yet.

Who Else Wants to Pay Higher Interest Rates?

In an attempt to “save” the economy over the last few years, the government has been breeding a whole new addition to the spending problem.

They’ve been keeping interest rates excessively low.

In fact, they can’t go any lower. And when interest rates are low like they are now, it means we’re basically putting free money in the economy.

Now you don’t have to be an economist to know that means one very deadly thing:

Inflation.

And it’s already visible. Food prices alone have soared over the past few years, and are still rising.

With inflation ready to snowball, low interest rates can’t last forever. It’s basically like mold, it slowly deteriorates the economy, and it eventually has to be removed. And that moment is fast approaching. And when it does, interest rates could go up drastically…

Loren Adler, research director at the Committee for a Responsible Federal Budget, and guy that put together this fancy graph, estimates that interest rates on National debt (as seen in the chart) could up another 6%.

And since we’re already paying 6%, interest rates will essentially double!

That means you and I and every other tax payer in the country will have to front the bill.

The Tax Strategy You Need to Have

I must say it seems a bit silly to rely on the Government after the mess they find themselves in.

But most of America still stocks money away into the plans offered by the government.

You see, 401ks, IRAs, and the like are all under the “Government Umbrella” and are a ticking time bomb… for two reasons:

Number 1 – You’re going to lose tons of money because you’ll pay more on taxes in the future than you will today.

Number 2 – And Probably more frigthening, is the Government has already presented the idea of taking over these plans entirely. They are trying to weasle their way into controlling every single dollar inside these plans. And what do you think they’ll do with it?

My guess is we’ll be reliving the Social Security problem all over again.

That’s why every dollar I have goes outside of the government’s control.

Outside of taxes.

No government involvement whatsoever.

And if you’re not looking for every possible way to (legally) avoid taxes in the future, you’re tax situation will be bleak. And later is too late.

But I’m not the only one. Banks and Fortune 500 companies are tossing billions into these accounts, more then they ever have.

It’s called the 500 account, and it’s been used by more wealthy people than you can imagine, even President’s of the United States have used it.

You see taxes are going up… guaranteed. The only uncertainty is when.

Now you tell me…

Are you worried about taxes jumping up? Or am I totally insane?