[ohio]

Poor capital management skills. if 41% of this country lives that way, then someone failed to teach them about money and taxation.

Wow, yesterday I was actually reading what you wrote. After that, you can go **** yourself.

Again, 50% of the country has a household income of $50k or less. You try supporting a family on that AND saving beyond the existing government tax shelters. Good ****ing luck, you soulless prick.

 

[Secret Squirrel]

Poor capital management skills. if 41% of this country lives that way, then someone failed to teach them about money and taxation.

Uhhh....you're really going to make that statement with the situation that the mortgage, credit, etc...markets are in?

I may be dense and in my own little world, but I realize that most of America is below the bar on comprehension skillz....

 

[manimal]

living paycheck to paycheck and those that have very little left over extends WAY beyond the group that gets welfare

41% say they often or always live paycheck to paycheck

yet living paycheck to paycheck does not exclude lower to middle income taxpayers from getting involved in the real estate market. my salary is bottom of the lower class range and there are several people i work with who use real estate as a secondary income. just because the average american has forgotten that credit is bad/savings good doesn't mean that this capital gains measure would only benefit the elite.

 

[Samirol]

Poor capital management skills. if 41% of this country lives that way, then someone failed to teach them about money and taxation.

yet living paycheck to paycheck does not exclude lower to middle income taxpayers from getting involved in the real estate market. my salary is bottom of the lower class range and there are several people i work with who use real estate as a secondary income. just because the average american has forgotten that credit is bad/savings good doesn't mean that this capital gains measure would only benefit the elite.

There may be minimal help to the lower class, but it will be a classic case of the rich getting much richer and the poor staying poor. If we look at who will benefit from getting rid of the capital gains tax, it will be those with the most capital.

 

[manimal]

Again, 50% of the country has a household income of $50k or less. You try supporting a family on that AND saving beyond the existing government tax shelters. Good ****ing luck, you soulless prick.

i do it on less than $50k with 3 kids based on the principles of the guy who came up with the plan i posted. it's called living within your means, something the vast majority of americans have shunned as old fashioned.

http://www.daveramsey.com/

i know...it's hard to believe that biblical money principles could actually work

 

[stoney]

I will make that statement. If you can not afford a mortgage, you should know not to buy the house. It's common fiscal awareness. If you can't afford it, don't buy it. Debt makes things cost more.

Ohio, until recently, I have made <$50k. In the five years since college, I made a combined income of ~$200k or 40k/yr. I live in the most expensive region of the second most expensive city in the nation. In that time I have paid down over $30k of debt (not incl interest) I accrued in school including school loans. I have set aside 10% of every dollar I made for 401k and/or IRA. I set aside 5% of my post tax for savings, AND I paid off around $1200/month for the last two years. My effective income after savings and debt was ~$1500/month. After rent I had $500/month for everything.
I have been cutting coupons as saving furiously and have barely spent any money that was not a necessity in years.
I dug myself out of a huge hole through frugality and sensible spending, all the while saving for a rainy day and the future.
I've lived in my car, eaten at food kitchens, and begged for change to take the train (while in a suit, there is very little that is that humbling). I have VERY little sympathy to those that have no fiscal sense.
*edit* I learned many of my lessons the hard way, but i learned from them. There seems to be a LOT of people in the US who do not learn from their lessons and just want someone to bail them out or fix the problem. I put myself into debt, and I took ownership of the problem and got myself out.

 

[Samirol]

Ah yes, "fvck you I got mine", the American way

 

[manimal]

There may be minimal help to the lower class, but it will be a classic case of the rich getting much richer and the poor staying poor. If we look at who will benefit from getting rid of the capital gains tax, it will be those with the most capital.

soooo...we should just bail out the rich idiots who put us in this predicament? who's more at fault? the execs who decided to sell subprime loans or the fools who bought them out of an urge to appear better off than they were? i fault both and i'm pretty apprehensive about bailing out either.

 

[ohio]

i do it on less than $50k with 3 kids based on the principles of the guy who came up with the plan i posted. it's called living within your means, something the vast majority of americans have shunned as old fashioned.

I don't disagree with you that Americans have a lot to learn about saving and fiscal discipline, but WE ALREADY HAVE TAX SHELTERS FOR UP TO $15,500 in annual savings. That's not even including the fact that a mortgage on your primary residence is tax sheltered. If you, with 3 kids, are saving more than $15k on $50k a year or less of income kudos to you. However, if you are, you actually *could* buy a house and start paying a mortgage which would also be tax sheltered (both the interest on the loan and profits if you ever sold it). If you're paying ANY capital gains at all, it's because you are allocating your money poorly.

My point is that cutting capital gains is not about protecting or giving back to working families. We shouldn't try to pretend it is. It is a gift to professional investors. If you want to encourage working families to save, just increase the existing tax shelters so they can save even more. If we bumped IRA contributions up to $25k, that would effectively eliminate capital gains for anyone making $75k or less, without giving $120B to people that don't need it (and are largely responsible for ****ing us in the first place).

 

[Secret Squirrel]

I will make that statement. If you can not afford a mortgage, you should know not to buy the house. It's common fiscal awareness. If you can't afford it, don't buy it. Debt makes things cost more.

Ohio, until recently, I have made <$50k. In the five years since college, I made a combined income of ~$200k or 40k/yr. I live in the most expensive region of the second most expensive city in the nation. In that time I have paid down over $30k of debt (not incl interest) I accrued in school including school loans. I have set aside 10% of every dollar I made for 401k and/or IRA. I set aside 5% of my post tax for savings, AND I paid off around $1200/month for the last two years. My effective income after savings and debt was ~$1500/month. After rent I had $500/month for everything.
I have been cutting coupons as saving furiously and have barely spent any money that was not a necessity in years.
I dug myself out of a huge hole through frugality and sensible spending, all the while saving for a rainy day and the future.
I've lived in my car, eaten at food kitchens, and begged for change to take the train (while in a suit, there is very little that is that humbling). I have VERY little sympathy to those that have no fiscal sense.

Exactly. Yes. You did it. It can be done.

However, having sympathy for those with no fiscal sense doesn't mean anything in regard to teaching people about responsibility and taxation.

We're where we are not due to people pulling themselves up responsibly but because everyone thought they were entitled to no money down houses, 3 cars, and 5 credit cards.

Now we're all going to pay.

 

[manimal]

Ah yes, "fvck you I got mine", the American way

ah yes, "the government should cover my fvckups because i have a right to not act my wage", the new and improved american way.

 

[manimal]

We're where we are not due to people pulling themselves up responsibly but because everyone thought they were entitled to no money down houses, 3 cars, and 5 credit cards.

Now we're all going to pay.

well said.

 

[Samirol]

soooo...we should just bail out the rich idiots who put us in this predicament? who's more at fault? the execs who decided to sell subprime loans or the fools who bought them out of an urge to appear better off than they were? i fault both and i'm pretty apprehensive about bailing out either.

Government takeover, similar to Sweden in 1992.

 

[ohio]

Ohio, until recently, I have made <$50k. In the five years since college, I made a combined income of ~$200k or 40k/yr. I live in the most expensive region of the second most expensive city in the nation. In that time I have paid down over $30k of debt (not incl interest) I accrued in school including school loans. I have set aside 10% of every dollar I made for 401k and/or IRA. I set aside 5% of my post tax for savings, AND I paid off around $1200/month for the last two years. My effective income after savings and debt was ~$1500/month. After rent I had $500/month for everything.
I have been cutting coupons as saving furiously and have barely spent any money that was not a necessity in years.
I dug myself out of a huge hole through frugality and sensible spending, all the while saving for a rainy day and the future.
I've lived in my car, eaten at food kitchens, and begged for change to take the train (while in a suit, there is very little that is that humbling). I have VERY little sympathy to those that have no fiscal sense.

That's great work, and I applaud you for it. However, I shouldn't need to point out that you only paid capital gains on the 5% of post-tax savings because you are using the tax shelters that are for someone in your income bracket. Additionally, if you really had 5% of savings post-tax, why didn't you pay the 15% max allowed under a 401k plan? In that situation, I don't see how eliminating capital gains helps you. Certainly not as much as bumping up the maxes on tax shelters, or providing a nominal shelter for post-tax investments.

Also, am I wrong in thinking you're single? If so, $40k is a lot of dough. That's what I made living in Boston and I didn't find it hard at all to pay back my student loans (undergrad and grad), max out my IRA, contribute 10% to my 401k, and still have some luxuries like a DH bike. It would be very different if I were supporting a wife and kids on that money.

 

[stoney]

There was a year or so in there that I was not being so conscientious. As for the 401k vs taxable acct, I have the means/knowledge.skill to make more money actively trading than via a 401k. IT worked out positive in the long-run, but again, I take the exception rule. I spent the time learning to get myself into this spot.

As for $40k as a single, SF is stupid expensive. Last time I saw a study it was about 10% more expensive than Boston.

 

[ohio]

My point is, if our goal is to shelter investments of working families, we just need to expand the tax shelter programs we have to be larger, more flexible, and include post-tax investments, but there should still be a nominal limit on what is sheltered.

You can have your reasons for removing capital gains tax, but claiming that working families are the ones that will benefit most is complete and utter bull****.

 

[stoney]

My point is, if our goal is to shelter investments of working families, we just need to expand the tax shelter programs we have to be larger, more flexible, and include post-tax investments, but there should still be a nominal limit on what is sheltered.

You can have your reasons for removing capital gains tax, but claiming that working families are the ones that will benefit most is complete and utter bull****.

You're right, that is a much better way to fix the problem, but the fact still stands that 99% of Americans are not that aware of their finances. What I am doing is still beyond apparently 40%.
Will cap gains alleviate investing taxes on lower incomes? Yes.
Will it be more advantageous to the mid+ income? Yes.
Who loses most in cap gains taxes? Mid income.
Why? When you are being clumped into upper wealth levels by AMT (see couples about to retire after saving prodigiously for 30 years), cap gains is insult to injury.
Is there a better way? Surely, make the govt live within it's budget, including future debts. That should reduce capital expenditures and *hopefully* reduce the need for adtl taxation.
Realistically? I'll be lucky to retire no matter how much I save because taxes will get higher, and the dollar worth less. Thanks congress! I didn't want to dream

 

[$tinkle]

It will trickle down from the super rich, to the barely rich people

country clubs, restaurants, dry cleaners, jet fuel delivery companies, home builders/remodelers, and resorts employ the barely rich?
edit: or are patronized by only the less-than-rich?

After that, you can go **** yourself.

more effective when said in the chambers of congress, i understand

Again, 50% of the country has a household income of $50k or less. You try supporting a family on that AND saving beyond the existing government tax shelters. Good ****ing luck, you soulless prick.

this 50% of the country is not necessarily raising a family. and far too many people truly believe their pension and/or SS is sufficient savings. you'd be amazed at how many people in their 30's think a million dollars is a lot of money. in today's dollars, i'm forecasting $3M for my wife & i from 65 til death to sustain today's lifestyle.

actuarial tables be damned.

 

[stoney]

country clubs, restaurants, dry cleaners, jet fuel delivery companies, home builders/remodelers, and resorts employ the barely rich?
edit: or are patronized by only the less-than-rich?
more effective when said in the chambers of congress, i understand
this 50% of the country is not necessarily raising a family. and far too many people truly believe their pension and/or SS is sufficient savings. you'd be amazed at how many people in their 30's think a million dollars is a lot of money. in today's dollars, i'm forecasting $3M for my wife & i from 65 til death to sustain today's lifestyle.

actuarial tables be damned.

We're in our late 20's and I'm planning on needing $5mm to maintain a decent lifestyle if we can retire at 55.

 

[Defenestrated]

The Joker, reading your statements in this thread has convinced me that you are both frighteningly apathetic as well as well as misguided (which is perplexing to me considering your stated experiences).

The concept that millions of Americans are victims of socio-economic entrapment seems completely lost to you. You seem to think that through hard work and self reliance anyone can achieve economic mobility in this country...

On several levels our society is exclusive and far from indiscriminate. A large part of what is perceived as economic mobility and equal opportunity is actually selective and dependent on personal wealth.

 

[$tinkle]

The Joker, reading your statements in this thread has convinced me that you are both frighteningly apathetic as well as well as misguided (which is perplexing to me considering your stated experiences).

you want someone in his field to be an emotionally drenched blouse? isn't all the panic, fear, & greed what got us into this mess?

The concept that millions of Americans are victims of socio-economic entrapment seems completely lost to you. You seem to think that through hard work and self reliance anyone can achieve economic mobility in this country...

i certainly do, b/c i have.
but it's not about me (unless i agree w/ you & offer a supporting anecdote?)

On several levels our society is exclusive and far from indiscriminate. A large part of what is perceived as economic mobility and equal opportunity is actually selective and dependent on personal wealth.

is the fact that my wife & i (separately) have gone from being too poor to pay taxes to being in the 28% bracket without connections/inheritance relevant? the next bracket (33%) starts around $164k/annum. i probably won't attain that, and nor will about 95% of americans. would you have taxable incomes be inflated up 2 brackets for, say, 20% of americans? where should that come from - the upper 1%?

 

[Defenestrated]

I respect your experiences and all but...

No, anecdotes can never replace statistics and factual evidence that suggests otherwise.

What is evident is that the gap between the wealthiest and poorest has been widening steadily for decades.

What is evident is that the middle class has been bleeding for quite some time.

What is evident is that the U.S. is not the worlds leader in economic mobility, meaning, either it isn't able to offer the most equal opportunity for all, or tens of millions of Americans are somehow less industrious than the people of other industrialized nations.

 

[valve bouncer]

 

[dante]

I have to say, I'm not a big fan of the whole "cut the capital gains tax to help the middle class" thing. how much does the average middle-class family have in post-tax savings? $50k? I'm relatively certain the average is far, far less, but lets use that as an example (it's 12months of the median salary, which is more than most people have saved up).

50k at 10% annualized returns each year is $5k/year. That's $750 at the 15% tax rate, or $62/month.

BFD. Anybody who has $50k in the bank making $5k in interest isn't complaining about the $60/month they have to pay on taxes on that. Or at least none that I know.

 

[fluff]

I have to say, I'm not a big fan of the whole "cut the capital gains tax to help the middle class" thing. how much does the average middle-class family have in post-tax savings? $50k? I'm relatively certain the average is far, far less, but lets use that as an example (it's 12months of the median salary, which is more than most people have saved up).

50k at 10% annualized returns each year is $5k/year. That's $750 at the 15% tax rate, or $62/month.

BFD. Anybody who has $50k in the bank making $5k in interest isn't complaining about the $60/month they have to pay on taxes on that. Or at least none that I know.

Spot on. If you want to free up more money for investment, then cut income tax on the lower earners, giving them more disposable income. Cutting capital gains tax only helps those with sufficient disposable income in the first place, hardly the ones who don't need to feel the pain.

One could argue that was precisely the desire to gain great profits from mere capital investment (as opposed to hard work) that got us here in the first place.

 

[ohio]

I have to say, I'm not a big fan of the whole "cut the capital gains tax to help the middle class" thing. how much does the average middle-class family have in post-tax savings? $50k? I'm relatively certain the average is far, far less, but lets use that as an example (it's 12months of the median salary, which is more than most people have saved up).

50k at 10% annualized returns each year is $5k/year. That's $750 at the 15% tax rate, or $62/month.

BFD. Anybody who has $50k in the bank making $5k in interest isn't complaining about the $60/month they have to pay on taxes on that. Or at least none that I know.

Thanks for saying more concisely what I could only say in several angry posts less clearly. The issues of savings rate and capital gains are two separate issues that have little to do with each other.

On savings rate:
I am wholeheartedly in agreement that Americans don't save as much as they can or should. I am also of the belief that *some* of that behavior is a result of continued promises of easy money, easy credit, and steep income curves (driven by steep growth) spewed out by wall street. The evidence for that is watch how the savings rate changes in the next couple of months. People know how to save, they were just repeatedly getting the message that they didn't have to and it was a lot louder than the message that they do.

On capital gains:
Cutting capital gains doesn't help the middle class. It just doesn't. Don't try to feed me a line.

 

[$tinkle]

On capital gains:
Cutting capital gains doesn't help the middle class. It just doesn't. Don't try to feed me a line.

i think this is targeted toward the elderly vote, which is north of 95% turnout

 

[blue]

i think this is targeted toward the elderly vote, which is north of 95% turnout

And will soon die, giving the god-hating liberals a huge boost at the polls.

Stoney, you should've added the qualifier that you're white to your story. And 40k a year single in SF is easy to pull off. Did your parents pay for school, too?

Anecdotal evidence doesn't work...you should know that.

 

[$tinkle]

Anecdotal evidence doesn't work...you should know that.

so is it safe to assume you'll stop invoking your gf's $7K medical bill as evidence of our dire health care system?

 

[stoney]

And will soon die, giving the god-hating liberals a huge boost at the polls.

Stoney, you should've added the qualifier that you're white to your story. And 40k a year single in SF is easy to pull off. Did your parents pay for school, too?

Anecdotal evidence doesn't work...you should know that.

They paid for school, all non-tuition costs I bore. I agree, 40k is easy. It's was the year at 23k and year at 30k that forced my hand. I averaged 40k. I didn't get that across the board.
Plus getting into and staying in social circles that get you access to interviews and referrals for the good jobs cost money. That didn't help any.

Any way you try to reduce it, I went from highly in debt to not through good money management and smart fiscal behavior. I limited myself and did not live the lifestyle I wanted/could afford to such that I could get out of debt. Most people do not have the self-control to avoid living 'like the Jones', which is why they are in debt to their eyeballs.

Did I have some advantages? Yes
Did I have to work my ass off to make it happen? Yes
Did I have to give up the things I wanted to do what was right for me? Yes

 

[stoney]

so is it safe to assume you'll stop invoking your gf's $7K medical bill as evidence of our dire health care system?

At one point I did not have health insurance and ended up spending the night in the ER. I sold all of my bikes, and almost everything that was not a need to pay the bills and was still in debt from the bills. That was when the first RM donor bike was built - the help stoney ride - bike. **speaking of which, who is doing the RM bikes? I have TONS of parts now that can help someone else.**

I was also working two jobs until I started working my current job (including at AmEx and Morgan Stanley) to pay off my debts.

Blue can try to devalue it as much as he wants. For most people to get out of their current situation requires hard word and sacrifice. I was lucky that I was high enough up the low income scale that making those sacrifices and hard work allowed me to scrape myself up to the next level. not all are, but there are many who if they are willing to make the hard choices and work can get to the next level.

 

[fluff]

At one point I did not have health insurance and ended up spending the night in the ER. I sold all of my bikes, and almost everything that was not a need to pay the bills and was still in debt from the bills. That was when the first RM donor bike was built - the help stoney ride - bike. **speaking of which, who is doing the RM bikes? I have TONS of parts now that can help someone else.**

I was also working two jobs until I started working my current job (including at AmEx and Morgan Stanley) to pay off my debts.

Blue can try to devalue it as much as he wants. For most people to get out of their current situation requires hard word and sacrifice. I was lucky that I was high enough up the low income scale that making those sacrifices and hard work allowed me to scrape myself up to the next level. not all are, but there are many who if they are willing to make the hard choices and work can get to the next level.

Sounds like you worked hard and deserve to have paid off your debts, that's good and kudos to you for it.

You also imply that it was difficult and required sacrifice, where fortune was on your side was that you were positioned (native intelligence, plus education) to get decent paying work, and that you had no dependents who had to make the same hard choices you did.

Factor in that you are (most likely) well above average intelligence and were supported by family (at least to some part) for your education and you can see that it could be substantially harder, if not impossible for many people to be able to achieve what you did.

The thing is; society does not need to help those who, like you, can take care of themselves, it needs to assist those who struggle.

 

[stoney]

It also needs to teach those who are struggling how to better themselves.
My liberal side says give people education, not money. Give people jobs, but make them compete for them. Competition makes you want it more, to better yourself.

The innate failings of our educational system is where much of this starts. Without proper education, those who can, are not given the opportunity.
Though there will still be the 'can not's', there is a job for everyone. People just need to be willing to do what is needed, not just what they want.

 

[fluff]

It also needs to teach those who are struggling how to better themselves.
My liberal side says give people education, not money. Give people jobs, but make them compete for them. Competition makes you want it more, to better yourself.

The innate failings of our educational system is where much of this starts. Without proper education, those who can, are not given the opportunity.
Though there will still be the 'can not's', there is a job for everyone. People just need to be willing to do what is needed, not just what they want.

I agree, partly. Education of all is something society should strive for, sadly we appear to be stepping backwards on that score. Make people compete? Not so sure - not everyone wants to win that badly, better that we ensure that each person can use the skills that they have in a good environment for them, fostering competition will inevitably favour some over others.

Lack of education also leaves people prey to the dishonest marketing that is endemic to our consumerist society, but then people making sacrifices and doing without is not the American way, is it?

 

[SkaredShtles]

I found a great explanation for all this nonsense!

http://theamericanscene.com/2008/10/14/so-simple-a-caveman-could-do-it

 

[manimal]

Lack of education also leaves people prey to the dishonest marketing that is endemic to our consumerist society, but then people making sacrifices and doing without is not the American way, is it?

fools will be fools regardless of their level of education.

 

[Secret Squirrel]

It also needs to teach those who are struggling how to better themselves.
My liberal side says give people education, not money. Give people jobs, but make them compete for them. Competition makes you want it more, to better yourself.

The innate failings of our educational system is where much of this starts. Without proper education, those who can, are not given the opportunity.
Though there will still be the 'can not's', there is a job for everyone. People just need to be willing to do what is needed, not just what they want.

No more red pens!!! Only purple...