Are You Worried?

[Spee]

The top 1% of earners pay 21.20% of all taxes paid at an average rate of 24%, the top 2 - 5% of earners pay 14.55% of all taxes at an average of 18% (Top 5% pay @36% of all tax) The bottom 50% pay 3% of all tax collected at an average rate of 2.98%.

You're really digressing from topic here and your numbers are way way wrong.

From the IRS' own website:

- 86% of all federal income taxes are paid by the top 25% of wage earners

- 97% of all federal income taxes are paid by the top 50% of wage earners

- of that amount, 39% is paid by the top 1%

[Spee]

The maximum FICA (Social Security) tax deduction from your pay is about $5840 per year. In 15 years, that maximum would be about $87,000. It's true that your employer also pays about this much, but that is not a cost to you. It doesn't come close to your $225k.

I don't know what you've been smoking or where you get your information, but it's all wrong.

For starters, I get a quarterly statement from the government that tells me exactly how much I've contributed and exactly what my forecasted monthly payout is supposed to be. Did you think I just pulled those numbers from thin air? You are also dead wrong about the maximum social security taxes that can be paid every year. Believe me, I know. I have been paying the maximum for a lot of years. And the bureaucrats want to raise the rate yet again.

As for the employer contribution, you must be a mindless drone to think that is not a cost to me (or anyone else). That money could otherwise be offered as a higher salary, or a bonus or other benefit, so it sure as <deleted> does come right out of my pocket. It's no different than the ridiculously high corporate taxes. Corporations don't absorb corporate taxes and their half of the social security theft. They pass those costs on to the consumer and worker, resulting in higher priced goods and lower salaries.

And you better get your head out of the socialist manifesto, get out and smell some fresh air, and then start listening to some real economists. Social security is bankrupt and has been that way for a couple of decades. The money has been looted just as with any other Ponzi scheme, put into the general revenue fund, and spent. You can't rob Peter to pay Paul an hope to get away with it ad infinitum. Promising to pay out more than is taken in is not a viable business model.

[caulfield2]

http://en.wikipedia.org/wiki/Tax_rates_around_the_world

Where do you get the idea that the US corporate tax rates are the highest in the world? It's not even close...and these are the published rates, I can guarantee that NO company in the US is actually paying what they are supposed to. But when individuals cheat on taxes, it's "tax evasion," corporations doing the same thing it's "creative book-keeping" and "profit maximization."

How can any American even begin to trust the stock market if the numbers we have to base our stock picks on are completely fabricated and only insiders and executives with their "golden parachutes" in place can ascertain what is going on? Seriously, did you see what Thain did at BoA? Worse than Madoff...almost. Giving away billions in bonuses to his cronies, spending thousands of dollars on a toilet and ending up as yet another poster child for corporate greed and arrogance. But does he even have a single guilty bone in his body?

Edited January 28, 2009 by caulfield2

[flying]

Now what to do about cash in the bank?how safe?is there a better way to protect hard earned cash.any good advice out there?

I use the same saying they use for money in Thailand when it comes to banks anywhere

Dont put more in there than you willing to walk away from

Sad state when banks are no longer a safe feeling place eh?

ok flying but you did n't answer my question?for example my money is in australia in term deposits with interest rastes being whittled away.Yes the govt. gaurantees all deposits in aussie banks(but how much trust can we place in that )So where else to go with the money if not in the banks.has anyone got some seriously better ideas.

Hey sorry buddy I misunderstood you. Thought you mean physical safety

Your speaking more on what is the best use of cash right now.

We actually had a good thread about that a month ot two ago. I think it was inconclusive though....what a surprise eh?

Like you I lacked any good ideas right now. I would normally be invested in myself through speculative building. But of course that is out now.

I did like culfield2 suggests & got some PM's. But unlike what he said it is quite liquid for me as I am still in the US where you can always sell instantly. At least you still can..

Other than that I did lock up some in 12 month CD at 4% but I only did that with money that could be used to pay off a small existing mortgage

[Spee]

Where do you get the idea that the US corporate tax rates are the highest in the world? It's not even close...and these are the published rates,

Ummm .... I believe the context of the discussion was "in comparison to the rest of the industrialized world."

I won't even bother touching the rest of your anti-corporation paranoid ranting. What's the point?

[henryalleman]

Its seems that there is some doom and gloom about government pensions. But as long that government pension is indexed secured and paid by the government, I don't see much problems in the future.

demographics clearly indicate that this will not be the case in future.

Naam,

that same demographics show also that the baby boom generation will be a more and more important part of the voters in the near future. To give a small example. Despite the difficult budget position of my country the government raised up the lower pension with 4% beside the normal index raise.

[caulfield2]

Where do you get the idea that the US corporate tax rates are the highest in the world? It's not even close...and these are the published rates,

Ummm .... I believe the context of the discussion was "in comparison to the rest of the industrialized world."

I won't even bother touching the rest of your anti-corporation paranoid ranting. What's the point?

Ummm...do you even bother to read? Seriously?

Brazil 34%

Canada 29.5%-35.5%

China 25%

Germany 30%

India 30-40%

Italy 33%

Japan 30%

Mexico 28%

Spain 25-30%

UK 21-28%

All those numbers are above or "par" with what American corporations are paying, on average. If you want to count it as total monies paid instead of as a percentage, then fine...because the US economy is still the largest in the world, then your statement is true, but grossly misleading. By the way, those low rates are really helping out now in Iceland, Ireland, Latvia, Hungary, Lithuania and Estonia.

When you add much lower personal income tax rates COMPARED to MOST of the INDUSTRIALIZED WORLD, I'm not sure what you are complaining about. Maybe you should move to one of those other countries that foster a better business climate or don't even charge business taxes? How about it?

[Neeranam]

I was thinking of starting to pay into the pension scheme. Who know what will happen in 25 years time?

I don't think I'll bother now - it's a gamble - I'll buy lottery tickets with my extra money instead.

[caulfield2]

Well, yes....unless you control your own money...it could always end up in a Madoff investment scheme (look at how many charities/NGO's were victimized, like that of Nobel Peace Prize winner Elie Wiesel) or your school pension fund could end up with Long Term Capital Mgt hedge fund and be devastated.

If you want to trust the market and roll with the punches, just put it in an index fund (Vanguard is the best) and don't look at it from month to month or you will go crazy. If you want to be a bit more conservative, you can put it in a "value" fund. Even that hasn't been safe, two of my investments are in Legg Mason (Opportunity and Value) and Oakmark (Fund and Select) and these "value" investments have gone down 25% more than the market as a whole. Fortunately, I don't have to sell anything...but that money will have to work twice as hard going back up as it did going down.

At any rate, index funds aren't actively managed (good thing, as most manager can't consistently beat an index and they make so many transactions racing after returns that their transaction fees cut into your ROI, too) and they don't require upfront loads, which are a waste of your money IMO. Only no-load mutual funds should be considered.

[samuibeachcomber]

back to the thread of the topic,no am not worried to the extent that i'm tearing my hair out of biting my finger nails,but i might shoot myself if the banks go down the gurgler with my money/close down atm machines etc.whichever comes first.maybe i'll have to go and sell myself but i fear not many takers.

[CaptHaddock]

The maximum FICA (Social Security) tax deduction from your pay is about $5840 per year. In 15 years, that maximum would be about $87,000. It's true that your employer also pays about this much, but that is not a cost to you. It doesn't come close to your $225k.

I don't know what you've been smoking or where you get your information, but it's all wrong.

For starters, I get a quarterly statement from the government that tells me exactly how much I've contributed and exactly what my forecasted monthly payout is supposed to be. Did you think I just pulled those numbers from thin air? You are also dead wrong about the maximum social security taxes that can be paid every year. Believe me, I know. I have been paying the maximum for a lot of years. And the bureaucrats want to raise the rate yet again.

As for the employer contribution, you must be a mindless drone to think that is not a cost to me (or anyone else). That money could otherwise be offered as a higher salary, or a bonus or other benefit, so it sure as <deleted> does come right out of my pocket. It's no different than the ridiculously high corporate taxes. Corporations don't absorb corporate taxes and their half of the social security theft. They pass those costs on to the consumer and worker, resulting in higher priced goods and lower salaries.

And you better get your head out of the socialist manifesto, get out and smell some fresh air, and then start listening to some real economists. Social security is bankrupt and has been that way for a couple of decades. The money has been looted just as with any other Ponzi scheme, put into the general revenue fund, and spent. You can't rob Peter to pay Paul an hope to get away with it ad infinitum. Promising to pay out more than is taken in is not a viable business model.

Here are the SS and Medicare tax rates from the SSA:

http://www.ssa.gov/OACT/ProgData/taxRates.html

The SS tax rate (FICA or OASDI) is 6.2%. This rate is applied to earned income up to the maximum in 2008 of $102,000 as described here:

http://en.wikipedia.org/wiki/Federal_Insur...butions_Act_tax

The maximum FICA tax paid by taxpayers in 2008 was 6.2% of $102,000 or $6,324. Warren Buffet did not pay a penny more.

Note this does not include Medicare tax which is 1.45% of all earned income. Nor does it include the employer's portion of either. If you are self-employed you paid both portions.

I am afraid your vehemence is a poor substitute for competence.

[Naam]

Its seems that there is some doom and gloom about government pensions. But as long that government pension is indexed secured and paid by the government, I don't see much problems in the future.

demographics clearly indicate that this will not be the case in future.

Naam,

that same demographics show also that the baby boom generation will be a more and more important part of the voters in the near future. To give a small example. Despite the difficult budget position of my country the government raised up the lower pension with 4% beside the normal index raise.

i agree Henry. but voters and votes cannot generate money out of thin air.

[yabaaaa]

I use the same saying they use for money in Thailand when it comes to banks anywhere

Dont put more in there than you willing to walk away from

Sad state when banks are no longer a safe feeling place eh?

WHAT ??

Is this what the financial crisis has really done to people - turned them into paranoid dimwits ?

(no personal offence Flying, I have always found your posts to be sensible in the past).

Such attitudes have no place in the 'reasonable world' and only fuel the doom and gloom merchants, preventing the much-needed return of confidence to the markets.

I agree that if your bank deposits are not covered by government guarantees then think seriously about whether they are in the right place.

Flying's comment is typified by one moronic act I witnessed in a UK bank last year - a lady was depositing GBP 21,000 being her savings from Halifax bank (HBOS) because she was worried about the 'scare-mongering'comments about the Halifax's solvency. At that point her savings were already guaranteed to GBP 30,000 by the government. What a waste of time for everyione - including me. waiting in the queue.

Lets start a campaign to get some reality back into the world.

And w e all know governments never lie, right?

[henryalleman]

Its seems that there is some doom and gloom about government pensions. But as long that government pension is indexed secured and paid by the government, I don't see much problems in the future.

demographics clearly indicate that this will not be the case in future.

Naam,

that same demographics show also that the baby boom generation will be a more and more important part of the voters in the near future. To give a small example. Despite the difficult budget position of my country the government raised up the lower pension with 4% beside the normal index raise.

i agree Henry. but voters and votes cannot generate money out of thin air.

Independant institutes that "mutatis mutandis" there will be no problem till 2040, and that moment I'm already 2 meters deep.

[drummachine]

My standard of living has been deeply impacted but I am not worried. I probably should be though.

You got the right attitude.

Chicken n Rice...cheap man.....

[ifeltsweet]

I have not noticed any changes in my life yet. I guess it doesn't directly impact everyone. Let's hope I'm not wrong.

www.hungrysiam.com - Bangkok Restaurant Guide