The 7 Money Personality Types
.The7 Money Personality Types, says psychology expert—how to tell which one you are (and the pitfalls of each)
Published Wed, Apr 28 2021 12:51 PM EDT Ken Honda, Contributor
We often stress about the importance of financial literacy, such as gaining a strong understanding of how money works and having the resources to make informed decisions. But when it comes to establishing financial health, one thing most people fail to consider is their money personality type — or their approach and emotional responses to money.
We each have our own beliefs and emotions about money, and they are mostly shaped by our individual life experiences (e.g., passed down from our parents or influenced by our current situations).
In my 10-plus years of researching the psychology of money and happiness, I’ve found that there are seven distinct money personality types. Typically, we fall into a combination of many types, and not just one.
The 7 Money Personality Types, says psychology expert—how to tell which one you are (and the pitfalls of each)
Published Wed, Apr 28 2021 12:51 PM EDT Ken Honda, Contributor
We often stress about the importance of financial literacy, such as gaining a strong understanding of how money works and having the resources to make informed decisions. But when it comes to establishing financial health, one thing most people fail to consider is their money personality type — or their approach and emotional responses to money.
We each have our own beliefs and emotions about money, and they are mostly shaped by our individual life experiences (e.g., passed down from our parents or influenced by our current situations).
In my 10-plus years of researching the psychology of money and happiness, I’ve found that there are seven distinct money personality types. Typically, we fall into a combination of many types, and not just one.
7 Money Personality Types
Ken Honda, author of “Happy Money”
Identifying which types you fall under, and understanding the pitfalls of each, can significantly improve your relationship with money. It can help you do things like spend less on impulse purchases, be better about budgeting, invest wisely and ensure a nice nest egg for retirement.
1. The Compulsive Saver
Signs you might be a Compulsive Saver:
You put away money endlessly, sometimes with no actual end goal in mind.
You believe saving money is the only way to feel more secure in life.
You’re very frugal. (Friends will often come to you for advice on which phone company is the cheapest, which point cards are worth it, or when to buy plane tickets at the lowest price.)
Pitfalls: Some Compulsive Savers are so afraid of losing money that they go their entire lives without spending any of what they worked so hard to save. For example, they might choose to skip out on hobbies or activities that could bring them happiness and purpose.
Money advice: It’s all about moderation; learn to find a balance between saving money and enjoying life. Think about where you see yourself in the future and how you can use your savings to get there.
2. The Compulsive Spender
To continue reading, please go to the original article here:
https://www.cnbc.com/2021/04/28/7-money-personality-types-and-the-pitfalls-of-each.html
Don’t Ever Give Up: Surviving 10 Years Of Prison
.Don’t Ever Give Up: Surviving 10 Years Of Prison
Updated: 12/04/2019 by Financial Samurai
When I was in high school, I got in a lot of trouble. As a result, I often wondered if anybody would ever give me a chance at life. Because I ended up receiving multiple chances despite my screw ups, I’ve learned to be more thankful and not take things for granted. I also developed an affinity for people who also had a rough time growing up, but found a way to make things work.
The following is a guest post from Bill, a man who spent 10 years in prison before getting on the path to financial freedom. Hopefully his post will give you the motivation to stick with things when times are tough and not lose faith that everything will turn out OK in the end.
Don’t Ever Give Up: Surviving 10 Years Of Prison
Updated: 12/04/2019 by Financial Samurai
When I was in high school, I got in a lot of trouble. As a result, I often wondered if anybody would ever give me a chance at life. Because I ended up receiving multiple chances despite my screw ups, I’ve learned to be more thankful and not take things for granted. I also developed an affinity for people who also had a rough time growing up, but found a way to make things work.
The following is a guest post from Bill, a man who spent 10 years in prison before getting on the path to financial freedom. Hopefully his post will give you the motivation to stick with things when times are tough and not lose faith that everything will turn out OK in the end.
I walked into my jail cell. I heard the door close behind me. I had just been sentenced to ten years in prison. It was my first time ever in trouble and I was in shock. I didn’t know what to think. The emotions came in horrible waves. I felt an overwhelming sense of relief at first. The night before, my attorney had braced me with the reality that the negotiations with the district attorney had not gone well, and that the state was going to be recommending 20 years of incarceration.
In court that day, the judged looked down at me in handcuffs and I heard him read his sentence in shock: “The state sentences you to ten years in prison. Due to sentencing guidelines, you will have no chance at early release or parole. Good luck to you.”
That night the harsh reality of being sentenced to 10 years in prison settled in my mind like slow mental torture. How was I going to survive it? How could I hold onto my sanity with such a horrible future ahead of me? I reflected how I found myself in this position. I had first used drugs when I was 14, smoked a joint, and liked it. For years, drugs and parties provided an escape from my otherwise normal life, and drugs provided me a fantasy of happiness I thought was real. But that illusion was shattered after a friend left my college apartment one night after partying, overdosed, and died in his sleep.
The next morning, I was arrested and charged with “reckless homicide by delivery of a controlled substance.” I had provided some of the drugs that contributed to his death that night, and that’s all the state had to prove to convict me of the charge.
I had gotten high hundreds, or thousands of times, but I never meant to harm anyone. It was a terrible accident. Everyone involved in the tragedy lost. I learned that when you play with fire, you don’t get to decide how badly you get burned.
![dont-ever-give-up[1].jpg](https://images.squarespace-cdn.com/content/v1/5d5222a44813620001d89582/1620042393676-MJUH4WMVO27C91I6PSC8/dont-ever-give-up%5B1%5D.jpg)
Life as I knew it was over. No one was going to fight for a comeback for me. My life was now a mission to prove that I was a better human being than the one they threw away for a decade.
The Awakening: Step 1
The morning following my sentencing hearing, I was driven to prison in a van filled with 5-10 other inmates I’d never seen or met. We rolled across the highway in blaze orange jumpsuits, and chains wrapped around our wrists, ankles, and waists. When we arrived at the prison intake dock, we were given a badge displaying our prison inmate number.
To continue reading, please go to the original article here:
https://www.financialsamurai.com/dont-ever-give-up-surviving-10-years-of-prison/
Be Prepared For The Next Black Swan
.Be Prepared For The Next Black Swan
By Larry Swedroe
“Measures of uncertainty that are based on the bell curve simply disregard the possibility, and the impact, of sharp jumps… Using them is like focusing on the grass and missing out on the (gigantic) trees. Although unpredictable large deviations are rare, they cannot be dismissed as outliers because, cumulatively, their impact is so dramatic.”
— Nassim Taleb, The Black Swan: The Impact of the Highly Improbable
Over the course of the first two decades of the 21st century, equity markets faced three “black swan” events: the attacks of September 11, 2001, the Global Financial Crisis that began in late 2007 and the COVID-19 pandemic. Each resulted in steep falls in equity prices. The term “black swan” was a common expression in 16th-century London that described impossibility. It derived from the old-world presumption that all swans must be white—because all historical records of swans reported that they had white feathers.
Thus, a black swan was something that was impossible, or nearly impossible, and could not exist. After the discovery of black swans in Western Australia in 1697 by a Dutch expedition led by explorer Willem de Vlamingh on the Swan River, the term metamorphosed to connote that a perceived impossibility may later be found to exist.
Be Prepared For The Next Black Swan
By Larry Swedroe
“Measures of uncertainty that are based on the bell curve simply disregard the possibility, and the impact, of sharp jumps… Using them is like focusing on the grass and missing out on the (gigantic) trees. Although unpredictable large deviations are rare, they cannot be dismissed as outliers because, cumulatively, their impact is so dramatic.”
— Nassim Taleb, The Black Swan: The Impact of the Highly Improbable
Over the course of the first two decades of the 21st century, equity markets faced three “black swan” events: the attacks of September 11, 2001, the Global Financial Crisis that began in late 2007 and the COVID-19 pandemic. Each resulted in steep falls in equity prices. The term “black swan” was a common expression in 16th-century London that described impossibility. It derived from the old-world presumption that all swans must be white—because all historical records of swans reported that they had white feathers.
Thus, a black swan was something that was impossible, or nearly impossible, and could not exist. After the discovery of black swans in Western Australia in 1697 by a Dutch expedition led by explorer Willem de Vlamingh on the Swan River, the term metamorphosed to connote that a perceived impossibility may later be found to exist.
With the publication of Nassim Nicholas Taleb’s 2001 book, Fooled by Randomness, “black swan” became part of the investment vernacular — virtually synonymous with the term “fat tail”. In terms of investing, fat tails are distributions in which very low and high values are more frequent than a normal distribution predicts.
In a normal distribution, the tails to the extreme left and extreme right of the mean become smaller, ultimately reaching zero occurrences. However, the historical evidence on stock returns is that they demonstrate occurrences of low and high values that are far greater than theoretically expected by a normal distribution.
Thus, an understanding of the risk of fat tails is an important part of developing an appropriate asset allocation and investment plan. Unfortunately, many investors fail to account for the risk of fat tails. Let’s look at some evidence on their existence.
Javier Estrada, author of the 2007 study Black Swans and Market Timing: How Not To Generate Alpha, examined the returns of 15 stock markets and more than 160,000 daily returns. He sought to determine the likelihood that investors can successfully predict the best days to be in and out of the market. Following is a summary of its findings:
1. Stock Returns Are Not Normally Distributed
Black swans appear with far greater frequency than predicted by normal distributions. For example, for the Dow Jones Industrial Average, 29,190 trading days (107 years) produced a daily mean return of 0.02 percent and a standard deviation of 1.07 percent. Under the assumption of normality, 39 days would produce returns above 3.22 percent, and 39 would produce returns below -3.17 percent.
However, there were six times the number of returns outside that range—253 daily returns below -3.17 percent and 208 above 3.22 percent. Note that the maximum and minimum daily returns were 15.34 percent and -22.61 percent. The returns exhibited a high degree of negative skewness (the left tail of the distribution curve is larger) and excess kurtosis (fat tails)—clear departures from normality.
To continue reading, please go to the original article here:
https://www.evidenceinvestor.com/be-prepared-for-the-next-black-swan/
Feel Better
.Feel Better
Jonathan Clements Humble Dollar| April 10, 2021
WARREN BUFFETT doesn’t have the best investment record over the past three decades. That accolade apparently belongs to Jim Simons. Buffett also isn’t the world’s richest person. In fact, he hasn’t held that title for the past dozen years and currently ranks No. 6, with barely half the wealth of today’s richest person, Jeff Bezos. I doubt Buffett feels bad about this. Is your surname neither Simons nor Bezos? I don’t think you should feel bad, either.
Money can be maddening—if we let it. There will almost always be some parts of our portfolio whose performance disappoints. There will always be some folks who are wealthier. But whether it’s our investment performance or our overall net worth, we shouldn’t let ourselves be bothered by our relative standing. Why not? Here are five reasons.
Feel Better
Jonathan Clements Humble Dollar| April 10, 2021
WARREN BUFFETT doesn’t have the best investment record over the past three decades. That accolade apparently belongs to Jim Simons. Buffett also isn’t the world’s richest person. In fact, he hasn’t held that title for the past dozen years and currently ranks No. 6, with barely half the wealth of today’s richest person, Jeff Bezos. I doubt Buffett feels bad about this. Is your surname neither Simons nor Bezos? I don’t think you should feel bad, either.
Money can be maddening—if we let it. There will almost always be some parts of our portfolio whose performance disappoints. There will always be some folks who are wealthier. But whether it’s our investment performance or our overall net worth, we shouldn’t let ourselves be bothered by our relative standing. Why not? Here are five reasons.
1. We likely made more good decisions than bad. Just 52.6% of American households own stocks, according to the Federal Reserve. If you count yourself among that group, your investment performance has almost certainly been better than that of the stock-less 47.4%.
What’s your net worth—the value of your assets, including your home, minus all debt? If it’s greater than $122,000, you’re wealthier than half of all U.S. households. Yes, all of us throw the occasional pity-party for ourselves. But the fact is, if you’re reading this article, you are likely in far better financial shape than most of your fellow citizens.
2. What’s valued economically changes. Those who have been paying attention will remember me telling this story before: When my father graduated from Cambridge University in 1956, he took the highest-paying job on offer, which was £800 a year working as a reporter for the Financial Times. That was £100 more than he could have made as a management trainee for Royal Dutch Shell, which was the next highest-paying job he was offered.
By contrast, when I graduated Cambridge in 1985, my starting salary as a junior reporter was £6,500, less than half what my university friends earned by joining financial firms in the City of London. For today’s would-be journalists, the wage disparity is likely to be even greater. My point: The price that the economy puts on particular skills changes over time.
If we have a set of talents that aren’t particularly well-rewarded by today’s economy, we could try a different career and perhaps that’ll prove necessary. Still, pursuing a high-paying career for which we’re ill-suited is likely to be a miserable endeavor—and probably an unsuccessful one.
3. Don’t overlook the role of luck. With good savings habits and a little financial savvy, I think almost anybody can amass at least a modest nest egg. But we all know people who have done far better. Oftentimes, they appear to have lucked out, whether it’s because they have wealthy parents, a high-earning spouse, a single lucky stock pick, or a boss who takes a shine to them and pulls them up the corporate ladder.
To continue reading, please go to the original article here:
10 Bad Money Habits You Learned From Your Parents and Need To Break Now
.10 Bad Money Habits You Learned From Your Parents and Need To Break Now
Cynthia Measom Tue, April 27, 2021,
An “Invest in You” savings survey by CNBC and Acorns found that some Americans are harboring what could be viewed as bad money habits. For example, 27% of Americans rarely discuss their personal finances with family. And 75% of Americans manage their own money, whereas only 17% hire a financial advisor. So if these Americans aren’t forming their money habits based on help from a financial advisor, who is their financial role model? According to the survey, 37% of respondents said it was their parent.
Does that mean that the financial habits your parents have are bad? Maybe so and maybe no. It depends on what those financial habits are. Some bad money habits are glaringly obvious. You know, like paying only the minimum on a maxed-out credit card each month or always spending extra money on wasteful items. But some aren’t so obvious — especially if you’re following the example set by a parent who serves as your financial role model.
To find out where you stand, check out these 10 bad money habits people learn from their parents, and see if any of them ring true for you.
10 Bad Money Habits You Learned From Your Parents and Need To Break Now
Cynthia Measom Tue, April 27, 2021,
An “Invest in You” savings survey by CNBC and Acorns found that some Americans are harboring what could be viewed as bad money habits. For example, 27% of Americans rarely discuss their personal finances with family. And 75% of Americans manage their own money, whereas only 17% hire a financial advisor. So if these Americans aren’t forming their money habits based on help from a financial advisor, who is their financial role model? According to the survey, 37% of respondents said it was their parent.
Does that mean that the financial habits your parents have are bad? Maybe so and maybe no. It depends on what those financial habits are. Some bad money habits are glaringly obvious. You know, like paying only the minimum on a maxed-out credit card each month or always spending extra money on wasteful items. But some aren’t so obvious — especially if you’re following the example set by a parent who serves as your financial role model.
To find out where you stand, check out these 10 bad money habits people learn from their parents, and see if any of them ring true for you.
Focus On Saving Your Money
Kristin Burton, founder of Strive Coaching, believes that one bad money habit learned from parents is to save your money.
“At first glance, this looks like great advice, but if you dig deeper it is missing a fundamental piece of wealth building,” Burton said. “Saving money should be reserved for an emergency fund (three to six months of monthly expenses set aside for unforeseen events) and “sinking funds” (money set aside for large, planned purchases). Aside from that, you can never save your way to wealth! You have to be investing. All money that is not specifically for an emergency fund or sinking fund should be invested, not saved.”
Max Fund Your 401(k) Instead of Paying Off Debt
Chuck Czajka, founder of Macro Money Concepts, said that max funding your 401(k) when you have credit card debt or student loans is one on a long list of bad money habits taught by parents.
“The 401(k) earns interest, but the whole account is taxable when you take the money out,” said Czajka. “So, you’re losing interest to credit card debt and student loans, and going to continue losing in the future to taxation on your 401(k) or IRA. It’s better to pay off that debt first, then save for retirement.”
Be Ashamed of Money Mistakes
Gretchen Caldwell, CFP and president of Pure Planning, believes that one bad money habit parents teach is to be ashamed of money mistakes.
To continue reading, please go to the original article here:
https://finance.yahoo.com/news/10-bad-money-habits-learned-110038180.html
Confessions of an Overnight Millionaire
.Confessions of an Overnight Millionaire “I constantly ask myself, Do I deserve this money?”
By Anonymous
What Is the Meaning of All This Money?
A series about the ever-more-chaotic future of finance.
Since July 2020, nearly 750 companies have gone public, raising more than $200 billion and minting thousands of new paper millionaires. Amid the frenzy, one millennial tech worker on the verge of unexpected wealth shared what was going through her mind.
When I joined my company, I theoretically knew there were only two exit paths — an acquisition or an IPO. And a third, where the company implodes, like WeWork, but you’re hoping for one of the first two. I didn’t really think about it when I signed on. I thought that I’d make a little bit from an IPO, maybe $200,000. You don’t think much about $200,000; it’s not life-changing.
Confessions of an Overnight Millionaire “I constantly ask myself, Do I deserve this money?”
By Anonymous
What Is the Meaning of All This Money?
A series about the ever-more-chaotic future of finance.
Since July 2020, nearly 750 companies have gone public, raising more than $200 billion and minting thousands of new paper millionaires. Amid the frenzy, one millennial tech worker on the verge of unexpected wealth shared what was going through her mind.
When I joined my company, I theoretically knew there were only two exit paths — an acquisition or an IPO. And a third, where the company implodes, like WeWork, but you’re hoping for one of the first two. I didn’t really think about it when I signed on. I thought that I’d make a little bit from an IPO, maybe $200,000. You don’t think much about $200,000; it’s not life-changing.
After I joined, people would say things like, “I think I’ll retire off this money.” I thought they were delusional. Then, last year, a friend called and said, “Are you ready to be a millionaire? Check the news.” That’s how I learned my company was IPO-ing. I had no idea. I would be making north of $6 million.
It’s not purely a celebratory time. It’s a stressful time, too, because of the constant decisions. The amount of money is so large that if I make a 5 percent fuckup, that’s hundreds of thousands of dollars.
I’ve been interviewing wealth managers, and honestly I couldn’t be less impressed. If I were a wealth manager, I’m exactly the client I would want. I’m young, and I could be a client for 50 years. So these people should be thirsty, but they’re not. The wealth-management firms are old school — I don’t think they’re designed for people like me.
I was video-chatting with one guy, and he didn’t know how to do a screen-share properly, so he was showing his entire screen, including windows that I probably shouldn’t have seen. And I was like, I’m going to trust you to oversee my millions? I was asking another, “How do you evaluate a tech stock?” You can’t just look at the financials — you have to look at the market, how the technology is unique. There’s a lot of industry understanding they lack. They’re using principles from the 1990s.
There are things that rich people do, and hiring someone to manage your money is one of them. I’m wondering, Is this something rich people do because other rich people are doing it? Is this industry a farce?
To continue reading, please go to the original article here:
Are You Guilty of This Financial (and Lifestyle) No-No?
.Are You Guilty of This Financial (and Lifestyle) No-No?
By Alexa Mason
The other day, one of my good friends was telling me about his money situation. To put it simply, he was waiting on his next paycheck to be able to pay for his son’s baseball pictures. I felt kind of bad for him, and my initial reaction was to start dishing out financial advice. You know: Tell him how he can stop living paycheck to paycheck, and that kind of thing.
But I bit my tongue.
My friend wasn’t looking for my sympathy or my advice. In fact, he’s one of the most frugal people I know. He already knows what to do. What he needed was somebody who would just listen; listen without judging; listen without telling him how he should be living his life.
Are You Guilty of This Financial (and Lifestyle) No-No?
By Alexa Mason
The other day, one of my good friends was telling me about his money situation. To put it simply, he was waiting on his next paycheck to be able to pay for his son’s baseball pictures. I felt kind of bad for him, and my initial reaction was to start dishing out financial advice. You know: Tell him how he can stop living paycheck to paycheck, and that kind of thing.
But I bit my tongue.
My friend wasn’t looking for my sympathy or my advice. In fact, he’s one of the most frugal people I know. He already knows what to do. What he needed was somebody who would just listen; listen without judging; listen without telling him how he should be living his life.
While driving home, I was extremely grateful I’d kept my mouth shut and been a good friend. I haven’t always done this, though, so I started to think about how often I dish out and receive unsolicited advice.
Are you guilty of the same thing?
When You Shouldn’t Offer Financial Advice
In the case of my friend, he works 40+ hours per week for $10/ hour and he is raising two kids. He’s also frugal beyond frugal. In the wintertime, he blocks off heat to all but a couple of rooms to save on electricity. And when his kids aren’t home, his house feels like a freezer. There may be some more places he can find some extra savings, but in his case, it’s mainly an income problem.
He knows he needs to earn more money, which is why he picks up overtime whenever possible. He is also actively looking for another job. But for a sizable chunk of the population, the pandemic hasn’t treated their job prospects very well. The economy is picking up and more companies will hopefully continue to keep hiring. The stimulus checks also helped a ton, but he has a long journey ahead of him and he knows it. He doesn’t need my advice at all. He needs my support, and I’m so glad I was able to recognize that.
To continue reading, please go to the original article here:
https://moneyning.com/better-yourself/are-you-guilty-of-this-financial-and-lifestyle-no-no/
This Is Not The Time To Procrastinate
.This Is Not The Time To Procrastinate
Notes From the Field By Simon Black April 27, 2021 Cancun, Mexico
In early 387 AD in the eastern Roman city of Antioch, a local bureaucrat stood outside of the city council chambers to read a new decree that had just arrived from Emperor Theodosius I. As the anxious crowd gathered, the bureaucrat began reading aloud-- Just as the crowd had feared, the new decree was a series of debilitating new taxes, ranging from heavy taxation on commercial activities, to mandatory donations to the Emperor himself.
The crowd became furious.
Antioch had already suffered immeasurably. The imperial government had depleted the city’s grain, killed off a large number of the youth from endless war, and already exacted heavy tolls and taxation. These new taxes were too much to bear. And a riot ensued almost immediately. People all over Antioch (in modern day Turkey) poured into the streets ripping down monuments of the imperial family, burned their portraits, and destroyed public buildings.
This Is Not The Time To Procrastinate
Notes From the Field By Simon Black April 27, 2021 Cancun, Mexico
In early 387 AD in the eastern Roman city of Antioch, a local bureaucrat stood outside of the city council chambers to read a new decree that had just arrived from Emperor Theodosius I. As the anxious crowd gathered, the bureaucrat began reading aloud-- Just as the crowd had feared, the new decree was a series of debilitating new taxes, ranging from heavy taxation on commercial activities, to mandatory donations to the Emperor himself.
The crowd became furious.
Antioch had already suffered immeasurably. The imperial government had depleted the city’s grain, killed off a large number of the youth from endless war, and already exacted heavy tolls and taxation. These new taxes were too much to bear. And a riot ensued almost immediately. People all over Antioch (in modern day Turkey) poured into the streets ripping down monuments of the imperial family, burned their portraits, and destroyed public buildings.
Naturally in our modern times we would call such activities “mostly peaceful”. But back then it constituted treason, and the rioters were ultimately put to death.
But the tax protests didn’t stop.
Throughout most of the next century, in fact, the Western Roman Empire was in a near-constant state of civil war and insurrection, quite often over the imperial government’s exorbitantly high tax rates.
Farmers, who were among the most heavily taxed citizens, abandoned their lands and sought refuge with northern barbarian tribes. Even soldiers and Roman noblemen fled the empire to escape the totalitarian regime, extreme corruption, and usurious tax rates.
Salvianus, a contemporary writer and historian at the time, wrote
“the name of Roman citizen, once not only much valued but dearly bought, is now voluntarily repudiated and shunned, and is thought not merely valueless, but even almost abhorrent.”
But taxes kept rising, and compliance became more of a hassle. For example, Valentinian III decreed that all transactions be conducted in the presence of a tax collector. This further hampered commerce, since economic activity had to be planned around the bureaucrats’ schedules.
In his book Decadent Societies, historian Robert Adams wrote, “by the fifth century, men were ready to abandon civilization itself in order to escape the fearful load of taxes.”
Today we are entering a similar era of extreme taxation that marked the morally and financially bankrupt late-stage Roman Empire.
At the state level, places like California have proposed all sorts of idiotic ideas, from hiking the already-high individual and corporate rates, to a statewide wealth tax, to even an ‘expatriation tax’ for anyone who leaves California.
The State of New Jersey is chasing away its highest income earners by raising taxes from 8.97% to 10.75%, and dropping the income threshold from $5 million down to $1 million.
What a surprise-- wealthy people and businesses are leaving California and New Jersey!
Then there are all the new ideas for federal tax policy, many of which are colossally stupid.
This week the Biden administration plans to unveil a proposal to tax up to 43.4% of capital gains, even though the history of taxation in the United States shows that capital gains tax increases actually result in LOWER tax revenue.
Plus many politicians still want to tax ‘unrealized’ capital gains, i.e. you have to pay tax on an asset that has appreciated in value BEFORE you sell it. Genius.
In addition, they’re working to not only raise corporate taxes, but to push other countries around the world to raise their corporate tax rates as well.
And last month I outlined their new proposal to raise estate taxes, AKA the death tax.
The legislation wouldn’t just raise the percentage of an estate the government takes. It would also lower the exemption to just $1 million, which is sure to affect small family business.
With even just a few of these changes taking place, many people will be paying upwards of 50% to 60% between state, local, and federal taxes.
And let’s be honest-- the decisions about how they spend it are appalling.
These are the same politicians who spend billions of dollars to build a website that doesn’t work… or who pay people to stay home and NOT work to save everyone from a virus with a 99% survival rate.
As I’ve been saying for some time, they are coming for your money, one way or another. Desperate, bankrupt governments always do.
But the good news is that this is not the 5th century. No one needs to “abandon civilization itself in order to escape the fearful load of taxes.”
There are still plenty of legal ways to pay a very low tax burden. With proper planning, you don’t have to be the Bolsheviks’ piggy bank.
Puerto Rico still offers extraordinary tax incentives-- and not just for US citizens. Business owners from around the world can set up a company that’s subject to a mere 4% corporate tax rate, with no further dividend or withholding tax.
And US citizens are able to enjoy tax-free capital gains on assets like stocks, bonds, and cryptocurrency.
If Puerto Rico isn’t your cup of tea, there are still plenty of ways to legally reduce what you owe; you can set up a more robust retirement plan and maximize contributions, for example, potentially taking tens of thousands of dollars per year off the table.
The Foreign Earned Income Exclusion allows US taxpayers living abroad to earn $108,700 this year, tax free, and married couples $217,400, plus receive extensive tax benefits on their housing.
People may also think about maximizing their lifetime gift tax allowances, or any number of more structured options like captive insurance or foreign pension plans.
Yes, it can be scary to constantly watch crazed politicians screaming about how they want to take your money.
But there are plenty of solutions if you have the right information and the willingness to take action.
The important thing to recognize is that this is not the time to procrastinate. If the last year has taught us anything, it’s that everything can change VERY quickly.
To your freedom and prosperity, Simon Black, Founder, SovereignMan.com
Why Financial Wellbeing Matters
.Why Financial Wellbeing Matters
By Robin Powell April 27, 2021
The concept of financial wellbeing is suddenly receiving plenty of attention. What is it? Why is it important? And most importantly, what can we do about it? The global pandemic has brought into sharper focus the concept of “financial wellbeing”, a holistic measure of personal security not typically captured by investment returns, consumer spending and saving data or macro-economic aggregates.
On some measures, financial wellbeing has been deteriorating in developed economies for years, thanks to privatisation of social services, rising divorce rates, the growth of short-term employment contracts, increasing consumer debt and the shift to defined-contribution retirement plans. But the sense of isolation and loss of control that many people feel in increasingly market-driven economies with minimal safety nets became more intense in 2020 as COVID-19 cut incomes through job losses, furloughs or reduced hours.
Why Financial Wellbeing Matters
By Robin Powell April 27, 2021
The concept of financial wellbeing is suddenly receiving plenty of attention. What is it? Why is it important? And most importantly, what can we do about it? The global pandemic has brought into sharper focus the concept of “financial wellbeing”, a holistic measure of personal security not typically captured by investment returns, consumer spending and saving data or macro-economic aggregates.
On some measures, financial wellbeing has been deteriorating in developed economies for years, thanks to privatisation of social services, rising divorce rates, the growth of short-term employment contracts, increasing consumer debt and the shift to defined-contribution retirement plans. But the sense of isolation and loss of control that many people feel in increasingly market-driven economies with minimal safety nets became more intense in 2020 as COVID-19 cut incomes through job losses, furloughs or reduced hours.
Dealing with the unexpected
In the US, a wellness survey by PwC showed that many American workers were already in a fragile financial state going into the pandemic, with more than a third of the full-time employed having less than $1000 saved to deal with unexpected expenses. The PwC report found with governments stretched and community services already beyond capacity, there was an important role for employers to pay in financial wellness.
“Employees are seeking guidance more broadly on how to prioritise their spending, which bills to pay, and how to handle creditors.” PwC said. “Employers have a unique opportunity here to help employees avoid making poor short-term financial decisions at the expense of their overall financial wellness.”
The Australian Government last November released a report showing many people had reduced their spending in response to the pandemic. Among the worst hit, one in seven had asked for a pause in their rent or mortgage payments, one in five had asked for financial help from family or friends and one in eight had sought welfare assistance.
In the UK, also, there is growing awareness of the role that employers can pay in addressing financial wellness issues, an effort that aside from the moral imperative also makes perfect business sense by helping staff regain a sense of control of their lives.
The Money and Pensions Service, sponsored by the UK government, found almost eight in ten British employees take their money worries to work, affecting their performance. In fact, money worries are the biggest source of stress for people, with 4.2 million worker days lost each year due to absences related to lack of financial wellbeing.
To continue reading, please go to the original article here:
https://www.evidenceinvestor.com/why-financial-wellbeing-matters/
The Golden Age of Fraud is Upon Us
.The Golden Age of Fraud is Upon Us
Posted April 27, 2021 by Ben Carlson
A 30-something low-level actor created a business plan that would buy the rights to cheap movies and turn around and sell those rights to HBO for audiences in Latin America. The investors backing the project were promised returns of 15% in just 6 months. No bad in an era of 0.25% savings account yields. Investors forked over more than $690 million to bankroll the rights to these films.
So what’s the catch?
The movie contracts with HBO were fakes, the business plan was a hoax and the entire ordeal was a Ponzi scheme where new money paid off previous investors. The money was used to provide a lavish lifestyle for the architect of the fraud, Zachary Horowitz.1 One investor claimed to have “99% of his and his family’s money” invested in Horowitz’s scheme.
The Golden Age of Fraud is Upon Us
Posted April 27, 2021 by Ben Carlson
A 30-something low-level actor created a business plan that would buy the rights to cheap movies and turn around and sell those rights to HBO for audiences in Latin America. The investors backing the project were promised returns of 15% in just 6 months. No bad in an era of 0.25% savings account yields. Investors forked over more than $690 million to bankroll the rights to these films.
So what’s the catch?
The movie contracts with HBO were fakes, the business plan was a hoax and the entire ordeal was a Ponzi scheme where new money paid off previous investors. The money was used to provide a lavish lifestyle for the architect of the fraud, Zachary Horowitz.1 One investor claimed to have “99% of his and his family’s money” invested in Horowitz’s scheme.
Thodex is a cryptocurrency trading platform in Turkey. Last week it was reported the 27-year-old founder of the exchange took a flight to Albania. He took with him $2 billion from more than 30k clients. Last month the company brought in hoards of new clients by offering free dogecoin to anyone that signed up.
Whoops.
I don’t know if this SCAMcoin actually happened or if it’s just a social media thing but it wouldn’t surprise me if it’s real:
https://twitter.com/i/status/1385365742506364929
If Charles Ponzi were alive today, I have no doubt that he would be able to raise capital from investors, probably in the form of a SPAC. Many investors would laud him for being a genius as he bilked investors out of millions of dollars.
When I was researching the history of financial scams for Don’t Fall For It the one thing that jumped out above all else is how similar financial frauds are across time and place. They typically involve new technologies, people with extraordinary sales skills and the insatiable human desire for get-rich quick schemes.
Despite the fact that people have been getting duped by hucksters and charlatans for centuries, there was one period that kept coming up over and over again in my research — the 1920s.
It was the golden age of financial fraud.
The Roaring 20s had everything a con-artist looking to dupe people out of their money could ask for — innovation, new financial products, a booming economy, rising markets, new and exciting technologies, loose lending standards, new communication tools and people getting rich all over the place.
To continue reading, please go to the original article here:
https://awealthofcommonsense.com/2021/04/the-golden-age-of-fraud-is-upon-us/
When The “Lord Protector” Turned Out To Be The Worst Tyrant Of All
.When The “Lord Protector” Turned Out To Be The Worst Tyrant Of All
Notes From The Field By Simon Black April 26, 2021 Cancun, Mexico
In early 1657, a young farmer from southeastern England named John Washington boarded a small merchant vessel bound for the English colonies in North America. Officially he was supposed to be part of a minor trade voyage to transport tobacco to the colonies. But secretly John had no intention of ever returning home. He wanted to sail as far away from England as he could.
Britain in the 1657 was a pretty miserable place. A series of civil wars throughout the 1640s had left the country impoverished and chaotic, leading to the dictatorship of Oliver Cromwell. Cromwell, in theory, was supposed to be on the side of the commoners who wanted to limit the power of the monarchy. But after installing himself as “Lord Protector” in 1653, Cromwell turned out to be more dangerous and autocratic than even the most tyrannical of kings.
When The “Lord Protector” Turned Out To Be The Worst Tyrant Of All
Notes From The Field By Simon Black April 26, 2021 Cancun, Mexico
In early 1657, a young farmer from southeastern England named John Washington boarded a small merchant vessel bound for the English colonies in North America. Officially he was supposed to be part of a minor trade voyage to transport tobacco to the colonies. But secretly John had no intention of ever returning home. He wanted to sail as far away from England as he could.
Britain in the 1657 was a pretty miserable place. A series of civil wars throughout the 1640s had left the country impoverished and chaotic, leading to the dictatorship of Oliver Cromwell. Cromwell, in theory, was supposed to be on the side of the commoners who wanted to limit the power of the monarchy. But after installing himself as “Lord Protector” in 1653, Cromwell turned out to be more dangerous and autocratic than even the most tyrannical of kings.
He fought costly, unnecessary wars of ego, and paid for it all by raising taxes far beyond his predecessors. Yet despite the high taxes, he ran a massive budget deficit and further indebted the country. Cromwell waged genocide against Irish Catholics, while hypocritically preaching unity and tolerance.
His administration jumped into bed with big business (like the East India Company, which “loaned” him the princely sum of 60,000 pounds), yet over-regulated artisans, merchants, and small shopkeepers.
He even confiscated property of those who couldn’t PROVE that they had been loyal to him.
Winston Churchill summed it up centuries later when he wrote, “the rule of Cromwell became hated as no government has ever been hated in England before or since.”
It was this hatred for Cromwell that prompted countless people to flee England forever.
John Washington was one of them; he settled in Virginia colony and had a family there. And more than a century later, his great-grandson George helped found a new nation.
It’s fitting that the American origin story of the first US President started with his great-grandfather who had the courage and independence to leave a brutal dictatorship behind.
This story is as old as history; from the Israelites leaving Egypt, to the Mayflower voyage, people have always sought freedom and opportunity abroad whenever their liberties at home are threatened.
Back then it was difficult. Voyages were dangerous and fraught with risk, disease, and starvation.
By comparison, today we have it easy; we can avail ourselves to much of what the world has to offer without leaving our living rooms.
But I’ll come back to that in a moment.
Have you stepped back lately to look at the big picture… to really take in what’s happening in the world? Honestly it’s difficult to believe.
It’s difficult to believe, for example, that we live in a world where several Dr. Seuss titles have been banned. But you’ll have no problems buying a copy of Adolf Hitler’s mostly peaceful Mein Kampf.
It’s difficult to believe that we live in a world where mostly peaceful protesters can pack together to torch cars and destroy property with impunity, yet everyone else is banned from having family over for Christmas dinner.
Power-hungry politicians are playing God with the economy and have established dehumanizing ‘people controls’ to save us against a virus that has a 99% survival rate.
And Lord Protector Fauci has become a tyrant in his own right.
Big Tech and Big Media refuse to allow any discussion about science and public health policy. Any attempt at rational discourse, including from prized scientific minds, results in censorship or banishment.
Children are taught that they are either victims or oppressors. Mathematics is full of white supremacy. History is racist. Biology is subjective. Capitalism is evil.
Big business has jumped on board the bandwagon, with dozens of major corporations blasting “Jim Crow” voting laws because certain state governments want voters to present valid identification before casting a ballot.
And the Twitter mob is there to keep everyone in check, with legions of people dedicated to being offended about something and destroying the lives of every heretic who dares disagree.
The government is fanning the flames of chaos by pushing Neo-Marxist policies, which they want to pay for with punitive, retroactive tax increases.
The US national debt has soared to more than $28 trillion, vastly exceeding the size of the entire economy, with no end in sight.
Meanwhile the central bank roughly doubled the size of its balance sheet in the past year, stoking inflation and creating a dangerous asset bubble that dwarfs the size of the 2008 financial crisis.
It’s extraordinary that five years ago, even two years ago, most of this would have been unthinkable.
But now it’s happened. And with every book they ban, every person they cancel, every demeaning public health order they issue, and every stimulus check they send, these people are emboldened.
And that takes me back to liberty and opportunity.
This isn’t the first time that freedom-minded people have found their world turned upside down.
But we have it far easier than our ancestors ever did.
We don’t have to risk the perils of a long ocean voyage. We have the whole world at our fingertips.
If you’re concerned about rising inflation, for example, you can buy gold online and have it delivered to a secure vault in a safe country of your choosing.
If you’re concerned about declining economic prospects in your home country, you can invest in rapidly growing frontier markets or more competitive foreign nations.
And if you want to have the ultimate Plan B for your family, you can even establish residency in a foreign country, or obtain a second passport.
All of this, in many cases, you can do without ever leaving town.
The world is not coming to an end. But it’s changing. Fast.
There’s no reason to despair or panic. Instead, have the confidence in yourself that you can use the many tools available to take back control of life, freedom, and prosperity.
All it takes is the right information, and the will to act.
To your freedom and prosperity, Simon Black, Founder, SovereignMan.com