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You don't have to compare to Zimbabwe though. Even compared to other rich countries like Japan, Germany and the United Kingdom, The United States has a very high concentration of individuals having a net worth of $1 million or more - in fact, the most of any country in sheer numbers.
That's why our perspective is very distorted.
I will add one point to this.....European taxes are sky high and absurd. Their inheritance tax laws would bring out the Tea Party and right-wing nut jobs to the streets. That is part of the reason European numbers are so low and ours are so high. In many ways, America IS the land of opportunity.
Having said that, there are some beautiful places in Europe I am sure many of us wouldn't mind living for a bit (Italian coast, Barcelona, Paris come to mind for me).
I will add one point to this.....European taxes are sky high and absurd. Their inheritance tax laws would bring out the Tea Party and right-wing nut jobs to the streets. That is part of the reason European numbers are so low and ours are so high. In many ways, America IS the land of opportunity.
Having said that, there are some beautiful places in Europe I am sure many of us wouldn't mind living for a bit (Italian coast, Barcelona, Paris come to mind for me).
It really depends how you look at it. In the most simplistic of senses, yes.
The question though, is what is the value of what you get for your taxes?
Quote:
Do Americans really pay fewer taxes than Europeans? Contrary to conventional wisdom, the answer surprisingly is: not really. That's because in return for their taxes, Europeans - even those unemployed during these tough times - have access to a generous support system for families and individuals that most Americans can only imagine. That includes not only quality health care but also child care, a good retirement pension, inexpensive college education, job retraining, paid sick leave, paid parental leave (after a birth or to care for sick children), ample vacations, affordable housing, adequate senior care and more. In order to receive the same level of benefits as Europeans, most Americans have to fork out a lot of out-of-pocket payments, in addition to our taxes. These payments often are in the form of fees, surcharges, higher tuition, insurance premiums, co-payments and other hidden charges.
Unfortunately these sorts of complexities are not calculated into simplistic analyses like Forbes' annual Tax Misery Index, which shows European nations as the most "miserable" and the low-tax United States as happy as a clam - right next to Indonesia, Malaysia and the Philippines. Increasingly these kinds of supports for families and workers are necessary for a healthy, happy and productive workforce. Europeans have them, but most Americans do not - unless you are a member of Congress, which of course generously provide European-level support for its members and their families.
I think one of the biggest failures of Americans at looking at taxes, is realizing all the little taxes they pay, that really add up.
I mean no disrespect when I say, you completely misunderstood the intent of my post. Which was to imply that comparing ones wealth (which to many is a measure of their success) to others who have had little opportunity, by virtue of circumstances beyond their control, is irrelevant.
Ok, that does make sense. But to a certain extent, this is true even in different developed countries. America gives people the best opportunity to be rich (theoretically). Just one example...Morningstar.com recently did a study of a bunch of different countries and found out that America had the lowest mutual fund fees by far...but a lot of Americans (even some fairly smart, well educated folks) don't even know what a mutual fund is. I believe that's because America also bombards people with lots of nonsense consumerism that too many people buy into, reducing their chances of ever being financially secure/comfortable, let alone rich. Also, the general cost of living and taxes here are lower than most other developed countries. Yes, health care and college education costs are a rip off, but everything else is pretty much the same or cheaper in America than most other developed countries.
One other issue I have with saying the Zimbabwe comparison isn't relevant, though...is that people tend to take what they have for granted. I honestly wish I could send Americans to some 3rd world country for a few weeks just so they could learn the difference between a true need and a want. They wouldn't even need to go to Zimbabwe. Peru or Mexico would do the trick.
Last edited by mysticaltyger; 06-03-2013 at 08:49 PM..
It really depends how you look at it. In the most simplistic of senses, yes.
The question though, is what is the value of what you get for your taxes?
I think one of the biggest failures of Americans at looking at taxes, is realizing all the little taxes they pay, that really add up.
I think in America the value just isn't there, or I'd be willing to pay more. Just take health care as one example. We spend so much money per capita on Medicare/Medicaid that other countries could take what we spend on those programs on a per capita basis and have decent universal health care at no additional cost. In America, the tax money almost always ends up being wasted on bureaucratic inefficiency or outright corruption, especially at the federal level, but often at the state level as well. And let anyone think I'm a right wing nut job, I include stuff like the military in that, too.
You don't have to compare to Zimbabwe though. Even compared to other rich countries like Japan, Germany and the United Kingdom, The United States has a very high concentration of individuals having a net worth of $1 million or more - in fact, the most of any country in sheer numbers.
That's why our perspective is very distorted.
True, but the word "Zimbabwe" is simply funnier than those other names!
Disclaimer: No Zimbabweans were harmed in the making of this jest.
Very interesting discussion. I went through all of 11 pages (last count) of the discussion.
Repeating what another poster had asked. Is the million 'net worth' or liquid 'cash or investments'? A million in the latter is a realistic number than the former.
I would disagree only because you can have a million in cash and the next day buy a house and really nothing changed except how you have it allocated. you can sell , rent instead of owning and have your money back anytime you want.
you really can not start to single things out in the count unless there is a reason.
many hedge funds require 1 million in liquid assets. many country clubs require 1 million net worth not including home. but for the most part how you divide it up for purposes of this discussion should not matter. if you hit a million we will give it to you even if part is in your home.
not counting the home for the homeowner would require subtracting out decades of rent for the non homeowner to account for housing costs to even things up.
I've heard this saying "The 1st million is the hardest and it gets easier after that". Why do you think that is?
Because you start out in life working a regular job and establishing yourself and your reputation. You have to network relentlessly and carve out your niche in the market. Plus you have to save judiciously and watch your pennies.
Once you reach the million-dollar plateau, you have more tools to work with. More leverage with the bank, more assets to play with, and more money left over at the end of the pay period. And, if you make your money in real estate, it requires finely-calibrated instincts. I know a lot of so-called millionaires in 2007 who aren't worth a plug nickel today because they didn't see the warning signs coming.
So, yeah. I've known plenty of guys out there who inherited substantial family businesses and grew them. It's just not nearly the same as starting a business from scratch.
I think $1million is a big deal. Yes there are many millionaire households...but there are also lot's of people actually in debt with a negative net worth or only a couple thousand to their name.
I would not recommend putting $1million in the stock market. Putting it towards something one has more control over is a better idea. Something that takes more work than the stock market but can earn you higher returns.
With a million in cash today I think there are great opportunities in real estate..of course not all markets but especially if one used leverage you should be able to make decent returns.
Also if you buy a business even if you don't use leverage you should be able to get a 20% return 200k a year or more. That's nothing to sneeze at.
If you live below your means that cash will build up relatively quickly , if you keep investing it properly then you have a shot at truly becoming wealthy.
I do agree with people that said $1million probably shouldn't be considered wealthy...but it's sure as hell better than what most people are at.
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I believe that's because America also bombards people with lots of nonsense consumerism that too many people buy into, reducing their chances of ever being financially secure/comfortable, let alone rich. Also, the general cost of living and taxes here are lower than most other developed countries. Yes, health care and college education costs are a rip off, but everything else is pretty much the same or cheaper in America than most other developed countries.
