You would think the world is ending

[UnknownXV]

Since anyone under the age of 60 will never see a penny of anything that goes into the SS "fund", it's not surprising they are complaining.

[scfr]

Taxes weren't raised. The tax break was allowed to expire.
It's not like a pay cut. It's like no longer getting a bonus.
I think those who will feel it the most are those who have been in the workforce only a couple years and don't remember the pre-tax cut days. Sometimes being old is an advantage.

[disneysteve]

I'm not saying it's a small amount of money. It's over 1,300 bucks I won't see this year. But it was a 2 year gift from the government. It's not like they're raising taxes, just ending a break that was always meant to be a temporary measure. It wasn't a big secret that it was going away.

It wasn't a secret, but that doesn't mean everyone knew about it. I'd say the vast majority of Americans were caught by surprise when they got their first 2013 paycheck today. I bet a lot of people are going to be hurting due to this.

We saved the money all along

Very smart, but also exceedingly rare, as I'm sure you realize. And even then, it still has an impact.

No matter how you look at it, a 2% pay cut is a big deal.

[bjl584]

Taxes weren't raised. The tax break was allowed to expire.
It's not like a pay cut. It's like no longer getting a bonus.
I think those who will feel it the most are those who have been in the workforce only a couple years and don't remember the pre-tax cut days. Sometimes being old is an advantage.

Maybe, maybe not. To me, this could be compared to someone (that isn't good with money) working and all of a sudden is required to start working overtime. What do most people do with a "raise" like that? Most likely, they will raise their standard of living. Then, one day down the road the overtime is cut off. They get a pay "cut" and are stuck with a bunch of expensive monthly payments for things that they can no longer afford. People are pretty short sighted for the most part. For someone living on the edge I could definitely see a 2% reduction in pay causing an issue. I live below my means and I save a lot, so this won't bother me, but I can see it effecting someone that isn't as disciplined financially.

[YLTL_Dan]

What do they say, it takes doing something about 10 times before it becomes a habit? That means the social security tax cut became a habit and most people adjusted to it

It's funny they even cut it in the first place since social security has been in peril since lawmakers started robbing from it. I'm sure it will be around when I retire (I'm 30) because so many people won't be able to live without it... but I'm not sure I'll ever get any of it!

[disneysteve]

It's not like a pay cut. It's like no longer getting a bonus.

I disagree. A bonus is typically a one-time payment, like at Christmas time. Something that you get regularly, every week for two years, isn't something I'd think of as a bonus.

For someone living on the edge I could definitely see a 2% reduction in pay causing an issue. I live below my means and I save a lot, so this won't bother me

I also live below my means and save a lot but a 2% drop in pay still has an impact. I typically save about 25% of my income. If my income drops by 2%, I may not be able to continue to save 25% unless we cut spending somewhere to "find" that money. So the result is either less money to spend or less money to save. In either case, it is less money to work with.

[bjl584]

I also live below my means and save a lot but a 2% drop in pay still has an impact. I typically save about 25% of my income. If my income drops by 2%, I may not be able to continue to save 25% unless we cut spending somewhere to "find" that money. So the result is either less money to spend or less money to save. In either case, it is less money to work with.

I agree that it will have an impact, but it won't put me in peril. At least not the way that some of my coworkers are saying that it will.

[bjl584]

Unfortunately, I think that we all saw this coming (at least those of us that pay attention.) We've been saying for years that taxes are going to have to go up. Well, here you go. This is the start of it. Those of us that are savers will adjust and will prosper in the long run.

[disneysteve]

I agree that it will have an impact, but it won't put me in peril. At least not the way that some of my coworkers are saying that it will.

For sure. That's the benefit of living below your means. Still, I don't want to see my savings rate drop, which means we will probably try to trim spending to make up the difference. Retirement is only getting closer.

[humandraydel]

No matter how you look at it, a 2% pay cut is a big deal.

I've always worked for large companies, so maybe I'm naive, but don't most people get 2-3% raises every year? So basically this year I lost most of my raise to the 2% tax increase. So I actually won't notice, it will just feel like I didn't get a raise.

[Gina23]

I'll be getting cut 2 grand, but we'll see what happens... I just increased my withholding because I was too slim there, so hopefully that offsets it a bit.

Agree, whoever became accustomed/entitled to 2% has some serious budget issues. I'm not advocating for a 2% cut by any means, but it was "yay for the time being thing" not something that one should become dependent upon.

[siggy_freud]

I don't see it as a pay cut, so much as I am not longer getting the 'extra' 2% I had been for two years. Yes, we're splitting hairs here, but it's not as if this was ever publicized as permanent.

[cypher1]

While I agree it's not the end of the world, that 2% for me used to be another 100 saved each month or between 1200-1300 annually.

[ActYourWage]

Being precise with money, any money removed from my spending plan, I find significant.

[FrugalTexan75]

When the 2% went into effect I was self employed, so didn't really notice it. I'll probably up my withholding by 2 to equal it out. I have a pretty small income, so the 2% does hurt - just mainly hurts my saving goals.