20 Ways You’re Throwing Away Money and How to Fix It

20 Ways You’re Throwing Away Money and How to Fix It

Tweak your habits to keep more money in your pocket.

GoBankingRates -- By Sabah Karimi Aug 2, 2022

You probably don’t realize all the ways you’re wasting money and leaving free money on the table — and these little missteps can add up to big dollar losses. Fortunately, once you’re aware of these bad money behaviors, you can take steps to change them. Making small tweaks to your lifestyle and spending habits could pay off in a big way.

Keep reading to find out the costly money mistakes you’re making — and how to stop making them so you can keep more money in your wallet.

1. Paying Checking Account Fees

It’s your money – you shouldn’t be charged to use it. If you really want to take your money further and save, look for a checking account with no fees so your money stays where it belongs — in your account. An excellent option is the T-Mobile MONEY Checking Account with zero account fees. That’s right, no account fees, including no overdraft fees.

The Un-carrier looks for ways to ease pain points everywhere, and big banks fit the bill. T-Mobile MONEY is built to be mobile-first so you can do all the things you need to do every day with your checking account right from the app – make mobile check deposits, set up direct deposit, pay bills, send a check and pay with a mobile wallet. There are no monthly account fees, no overdraft fees, and no transfer fees, plus no fees at over 55,000 in-network Allpoint® ATMs1 worldwide and no fees from T-Mobile for using out-of-network ATMs.

Not to mention, T-Mobile MONEY customers earn industry-leading interest and can get paid up to two days early with payroll direct deposit2.

2. Trying To Time the Stock Market

When stocks are on the rise, it’s tempting to think you’re smart enough to know when to get in and out to make a killing. But this move is one of the worst mistakes rookie investors make.

Experts say it’s nearly impossible to do this correctly every single time. After all, you need to be right twice — when you get out of the market and when you get back in.

3. Paying Full Price for Gas

Even though gas prices aren’t at their highest, you might not be taking advantage of free ways to drive the bill down further, such as by using rewards credit cards for cash back. Make sure to pay off your balance every month to avoid interest charges or late fees that’ll eat up any rewards you earned. You can also use the GasBuddy app to find the lowest gas prices in your area.

4. Not Using a High-Interest Banking Account

To continue reading, please go to the original article here:

https://www.gobankingrates.com/saving-money/savings-advice/ways-youre-throwing-money-away/?utm_campaign=1176748&utm_source=yahoo.com&utm_content=9&utm_medium=rss

The US Is About To Go Full Louis XVI

The US Is About To Go Full Louis XVI

Notes From the Field By Simon Black  August 8, 2022

On September 3, 1783, after nearly a year of excruciating back-and-forth negotiations, all sides had finally gathered together in Paris to sign a historic peace agreement.  It was a pretty important peace deal. Because the Treaty of Paris, as it is now known, is what formally ended the American Revolution, and when Great Britain legally recognized the United States as an independent nation.

The treaty was signed in Paris because France had been a major supporter of the US war effort. And just as soon as the ink was dry, French King Louis XVI ordered his finance minister to prepare an accounting of exactly how much money France had spent on US independence.

The result was nothing short of astonishing—more than 1 billion livres.

To put that number in context, the French Treasury’s entire annual revenue only amounted to around 200 million livres.

So they had basically sunk FIVE YEARS worth of their tax revenue fighting someone else’s war.

Granted, Britain was still one of France’s main rivals. And the French did not care for British King George III.

But the American War was simply too costly, and France had already been on very shaky financial footing well before this point.

Louis XIV had nearly bankrupted the country a century before. His successor, Louis XV, had to drastically slash expenses and could barely hang on financially.

Then, in 1774, just prior to the American Revolution, Louis XVI became king at a time that France was rapidly deteriorating.

You’d think that with so much economic turmoil at home that he would have focused on his own national interests… and, in lieu of money, weapons, and ships, he would have instead sent the royal thoughts and prayers to America.

But no. Lucky for the United States, Louis XVI courageously fought the American Revolution down to the very last French taxpayer.

Only after the war did Louis finally take stock of the situation and realize the truth: America was in a much better position. Britain was bruised but still powerful. Yet his own France was nearly bankrupt and desperately in need of cash. Not exactly a win/win.

Louis XVI was King, but his powers were limited; he was beholden to the legislature, called the Estates-General, and he couldn’t simply decree new taxes without their consent.

The King did, however, control the tax collectors. And Louis made sure they had every authority to coerce, harass, and intimidate money out of French citizens.

French tax collectors had the authority to walk right into people’s homes unannounced, conduct surprise inspections to look for hidden wealth, and walk away with whatever money or property they felt would satisfy the peasant’s tax bill.

This is actually a pretty common theme throughout history: governments that are on the ropes routinely resort to plundering the savings of their citizens.

Several ancient Roman emperors, in fact, from Diocletian to Valentinian III, famously sent ruthless tax collectors to harass their citizens and steal their wealth. Several ancient Chinese dynasties did the same thing. So did the declining Ottoman Empire.

Significantly ramping up tax collection efforts is typically a hallmark of an economy and empire in decline.

So we can’t be too surprised that, in its latest legislative bonanza, the US government is setting aside $80 billion for IRS tax collection efforts.

They’re calling the bill, of course, the Inflation Reduction Act. This is pure comedy—the legislation will do no such thing. Why would inflation, which in part was caused by excessive government spending, magically dissipate because of more government spending? It’s ludicrous.

But inflation aside, front and center in the legislation is $80 billion in funding for the IRS, primarily to step up its tax collection and enforcement efforts.

To put that number in context, the annual budget for the IRS is about $12 billion. So, even though the $80 billion will be leaked out over a period of several years, it constitutes a major increase in the IRS budget.

The entire idea is based on a bizarre notion known as the ‘tax gap’. This is the difference between the amount of tax the government collects, versus the amount the government thinks they should collect.

In other words, the tax gap represents how much they believe people are cheating. And the estimates vary wildly, from $100 billion per year to a whopping $1 trillion per year.

Frankly these numbers have always seemed to me like they were completely made up. No one has explained how they actually come up with such estimates. They just barf up some number and pretend that it’s true.

Obviously there are a whole lot of hardcore tax cheats out there, stealing and defrauding the system. But that’s not why the IRS is receiving an $80 billion boost.

This money will go to hire a small army of tax inspectors who will fan out across the nation on a giant fishing expedition that will ensnare countless middle class Americans and small businesses.

Certainly they’ll catch a few cheats along the way. And they may even find a few bucks to close that mythical ‘tax gap’.

But at what cost?

One of the biggest problems with the US economy right now is that it’s so much more difficult to produce goods and services.

Over the past few years, the people in charge have put up endless road blocks and obstacles for small business.

They vanquished the labor market and made it all but impossible to find workers. They destroyed the supply chain. They engineered historically high inflation. They came up with a myriad of costly new environmental and public health rules.

On top of that they constantly create new rules and regulations, many of which step far beyond the government’s authority.

(Last year, for example, the CDC Director decided in her sole discretion that she controlled the entire $10+ trillion US housing market.)

23% of full-time workers today require a government license to do what they do, according to the US Department of Labor. Even being a hairdresser is full of red tape and costly bureaucracy.

This new threat of widespread tax audits is going to be yet another obstruction to Americans’ productivity…. at a time when the economy desperately needs maximum focus.

Inflation is raging because there is a serious, global imbalance between the supply and demand of goods and services.

Specifically, demand is too strong because they doled out trillions of dollars in free money. And supply is weak because nearly every single government policy makes it harder for people to produce (which is yet another hallmark of empires in decline).

Now, on top of everything else, there is a very high likelihood of being harassed by the tax authorities.

Audits are incredibly unpleasant, costly, and time-consuming. Even if all of your accounts are in order and you’ve done nothing wrong, a tax audit monopolizes a tremendous amount of time and money.

It’s debilitating. Say goodbye to actually running your business, growing sales, or spending time with your family on nights and weekends… and say hello to preparing for your tax audit.

Your time will now be spent digging up receipts, finding old contracts, and trying to recall specific details of trivial decisions you made years ago.

Plus you’ll most likely have to pay outside experts to assist with the process, like CPAs and attorneys. And naturally the government does not reimburse you for such expenses. But at least you’ll get to deduct them… from your taxes.

In the end, after endless financial scrutiny, the government may conclude that you owe them a few bucks because of some undocumented deduction from several years ago. So you write them a check for some trivial sum… after having spent countless hours and effort taken away from your productivity.

The cost/benefit just doesn’t compute. And that’s why healthy, prosperous nations don’t engage in such absurd activities. They don’t need to.

Taxes ultimately represent the government’s ‘slice’ of an economic pie. So when a country is prosperous and an economy is strong, the government’s slice continues to grow because the overall economic pie is constantly getting bigger.

But nations in decline don’t see it this way. For them, the pie is shrinking. So they think the only way to increase their slice is to go after other people’s crumbs.

History shows this is absolutely the wrong move. Raising tax rates, inventing new taxes, and recruiting armies of tax collectors only makes the pie shrink even more.

Their efforts, instead, should be focused on making the pie bigger. But they don’t think that way.

Bear in mind this is all brought to you by the same people who are shoveling your tax dollars out the door to Ukraine $50 billion at a time. It’s very ‘Louis XVI’ of them.

All of these trends—the cannibalistic surge in tax authorities, the anti-productive regulations, the economic scarcity mentality—are all hallmarks of an empire in decline.

The situation is NOT terminal. It is NOT irreversible. But it is reason enough to have a Plan B.

To your freedom,  Simon Black, Founder, SovereignMan.com

P.S. Looking for solutions to safeguard your prosperity and freedom? Our step-by-step Plan B guides and library of actionable strategies are ON SALE - this week only. Click here to learn more.

https://www.sovereignman.com/trends/the-us-is-about-to-go-full-louis-xvi-36091/

7 Levels of Financial Freedom

7 Levels of Financial Freedom: How To Work Your Way Up, According to Experts

GOBankingRates  Andrew Lisa  Sat, August 6, 2022

Whether you’re living to work, drowning in debt, struggling to save, overspending, or existing from paycheck to paycheck, you’re all too familiar with the invisible chains of financial stress. The answer, of course, is financial freedom, but with so many bills and so little money left over at the end of the month, how could anyone get from here to there?

Grant Sabatier — a self-made millionaire and golden child of the FIRE movement — has created a roadmap that he says can bridge the gap between financial servitude and financial independence. There are seven levels, and if Sabatier is right that most Americans are already at the second level, you only have six more rungs to climb.

Level 1: Clarity

Step one is to assess and clarify. It’s time to take inventory of where you are financially and develop a clear picture of where you’d like to be. That means checking your credit and revisiting your bank and credit card accounts. You’ll also have to do the unpleasant job of gathering your bills and tabulating your monthly expenses.

You do have to do it, but if you keep up with it after that, you’ll only have to do it once.

“In order to take control of your finances during these changing times, as well as get a hold of your spending and investments, it’s important to create a financial plan,” said Radu Tyrsina, CEO and founder of Windows Report and Reflector Media. “To successfully manage your financial progress you need to be able to track your net worth, spending, and investments in order to get a larger view of where you stand.”

Level 2: Self-Sufficiency

When you clear this level, you’re standing on your own two feet. You’ve moved out of your parents’ house and you’re off any public assistance you’d been relying on to get by.

It’s important to note that self-sufficiency and financial independence are two different things. At level 2, you’ll probably be living paycheck to paycheck, struggling with debt, or both, but you’re no longer dependent. Although it might not feel like it, you’re finally in control of your own destiny.

Level 3: Breathing Room

To continue reading, please go to the original article here:

https://news.yahoo.com/7-levels-financial-freedom-way-130121143.html

How To Get Your Finances in Shape in 12 Months

How To Get Your Finances in Shape in 12 Months

GOBankingRates  Jennifer Taylor   Fri, August 5, 2022

Whether you’re buried in credit card debt, haven’t started saving for retirement or don’t currently have an emergency fund, you’re committed to turning things around.

Of course, knowing where to start isn’t always easy — especially if you’re planning to work toward several financial goals.

When it comes to which goals to set for the year, you’ll of course need to consider your unique situation. However, Mark Henry, founder and owner of Alloy Wealth Management, a wealth management firm based in Charlotte, North Carolina, shared six common financial objectives to get you started.

1. Save More Money

No matter how much money you earn, Henry said finding ways to save more money by the end of the year should be your top priority.

“If you make $3,000 a month, and can find a way to save 10% of your income a month for ten years, eventually, even without a raise, you will have one year’s salary in the bank,” he said. “During that time, with compounding interest, you will have five years’ worth of your salary saved.”

Take Our Poll: Do You Think You Will Be Able To Retire at Age 65?

2. Focus On Retirement Savings

When facing competing savings priorities — i.e., saving for your children’s college expenses or saving for retirement — Henry advised putting aside money for your own retirement first.

“A good retirement salary is equal to your working salary after taxes and what money you set aside for savings,” he said. “In most cases, people want to do more in retirement because now they have the time to do the things they’ve wanted to do their entire life, and they need more money to sustain a new lifestyle.”

3. Don’t Let Money Control Your Life

It might sound counterintuitive for a financial goal, but Henry said money should enrich your life — not control it. “Most of us thrive on instant gratification,” he said. “But when it comes to finances, gratification comes when you take control of your life and the power you get when you wake up and realize you have cash in the bank.”

To continue reading, please go to the original article here:

https://news.yahoo.com/finances-shape-12-months-143117526.html

9 Money Moves You Should Make This Week

9 Money Moves You Should Make This Week

GOBankingRates  Jordan Rosenfeld  Fri, August 5, 2022

It's easy to let our finances go on autopilot when we have so many other responsibilities and tasks keeping us busy in any given week. Yet finances don't just improve on their own -- getting to a place of financial stability or independence takes attention and conscious steps. Steps that you can make this week can make a huge difference in your financial picture, now and into the future.

Here are 9 money moves you should make this week -- your future self will thank you for it.

Automate Deposits to Savings and Investment Accounts

If you have a savings account and a retirement account that you put money into sporadically or only when it comes in, consider setting up regular automated deposits into these accounts. Not only does this make you less likely to splurge when money comes in, a phenomenon known as "present bias," according to CNBC, it guarantees that these accounts will grow steadily and with minimal effort.

Add To or Plan For an Emergency Fund

It might seem funny to put aside money that you hope never to have to use, but that's pretty much what an emergency fund is. However, the way life is, you're almost inevitably going to have an unexpected payment for something that breaks down, for potential job loss or expenses that crop up related to your children. While expert advice varies on how much you should have in such a fund -- many experts recommend three to six months worth of expenses -- you can start one at any time with any amount of money.

Set a Savings Goal

If you set a saving goal, you're more likely to put money away, according to Investopedia. Even if you aren't sure what you'd like to save toward, consider creating a savings account for such things as vacations, holiday gifts, college funds or just add to your emergency fund. Setting a savings goal can also help you budget better, as you look for ways to squeeze out that amount from your current spending.

Increase Your Contribution to a Savings or Investment Account

If you're currently putting away a minimal amount into savings or investment accounts, consider increasing your contribution and automating it. Particularly for retirement accounts, the more money you put in now, the more money you are likely to earn by the time you actually retire. According to CNBC, increasing your deposit amount by just 1% over 20 or 30 years can make a sizable difference. But you can also pad up savings accounts quickly with even a slight increase in your deposit amount.

Maximize Tax Deductions

To continue reading, please go to the original article here:

https://news.yahoo.com/9-money-moves-week-130025140.html

The Best Tax Deal in the Eastern Hemisphere

The Best Tax Deal in the Eastern Hemisphere

Notes From the Field By Simon Black  August 3, 2022

One of the most important elements of a Plan B is to legally reduce your tax rate. Depending on where you live, the government routinely confiscates up to half of your hard-earned income.

At best, this money is wasted and squandered— for example, the billions of dollars of military equipment left in Afghanistan, or billions in fraud taken through PPP Covid loans.  At worst, it is actively used against you— for example, the Justice Department targeting parents justifiably angry at their local school board.

By finding legal ways to pay less, you do your part to deprive the beast of its power, which feels good and does make a difference.  More importantly, you reclaim your own money to do with as you please. 

We’ve written extensively about Puerto Rico’s tax incentives offering a 4% corporate tax rate for qualifying businesses, and 0% on investment income. As a US territory free to set its own tax laws, it is the best tax-saving option for Americans, who owe taxes to Uncle Sam no matter where they live or earn income in the world.

However, Puerto Rico is not for everyone. Maybe you are on the other side of the world, and don’t want to relocate to Puerto Rico. Or perhaps you don’t like the tropical climate, or the Caribbean lifestyle.

In that case, you might want to consider the Republic of Georgia— the “Puerto Rico of Europe” when it comes to tax savings.

Georgia is located on the intersection of Europe and Asia, but the former Soviet state considers itself European.

A couple years back, to attract foreign investment, Georgia implemented a tax regime that allows certain people to pay as low as a 1% income tax rate on revenue.

Freelancers and digital nomads can often qualify by registering as an Individual Entrepreneur, and applying for Small Business Status.

For example if you’re a blogger, software developer, e-book author, virtual assistant, or create digital products, you’d likely fit the bill.

But there are restrictions. Consultants of any kind, such as tax advisors, do not qualify. Neither do those in the medical, architectural or legal professions, currency exchange operators, or gambling businesses.

And if you’re an employee of a foreign company, this will not work for you either.

But for those who qualify, it typically only takes a couple days to set up. Plus, Georgia makes it easy for foreigners to obtain a one year residency visa in the country.

Americans can certainly use these tax advantages too. Even though you will still owe US taxes, while living outside the US you can take advantage of the Foreign Earned Income Exemption to earn $112,000 tax free in 2022. Plus, taxes aren’t the only savings Georgia offers. We rate the country as “dirt-cheap” in our cost of living index. https://www.sovereignman.com/cost-of-living-index/

But a lot has changed in the region recently. So last week, I caught up with a friend of Sovereign Man’s named Lucas who had moved to Georgia to benefit from the tax savings.

I wanted to know what had changed since we heard from him in a Sovereign Man: Confidential Case Study last year. Since the Russian invasion of Ukraine in February, Georgia has seen a massive influx of Ukrainians and Russians fleeing the war, and Russia repression.

For Georgia, a country of just six million, the influx of upwards of 100,000 residents in the span of a few months caused quite the shock. Lucas said that the most obvious change was rising housing costs.

Many of the Russian newcomers have considerable means and come from more expensive cities like Moscow or St. Petersburg. Since many are still working remotely, they could afford to bid up rent prices.

Lucas and his partner previously found a good deal on an amazing apartment. They paid the equivalent of about $1,000 per month for a 150 square meter (roughly 1,600 square feet) apartment in a great location in the nation’s capital Tbilisi.

Now he has seen smaller, ground-floor apartments with no view go for $2,000 per month.

When Lucas’ apartment was sold recently, he and his partner decided it was time to move on from Georgia, rather than look for another place in an inflated market.

However that’s not because they soured on Georgia. Lucas says he would still recommend it for the right type of person. But it was never their long-term plan to stay in Georgia.

Contributing to the decision was that Lucas felt they did not have a solid Plan B in the event Russian aggression turns southward. Russia already invaded Georgia in 2008, so it is not outside the realm of possibility.

Lucas also felt that it was hard to find good workers, like repairmen and housekeepers, who paid attention to detail and took pride in their work.

In addition, power and water outages were becoming more frequent, (it really does sound like Puerto Rico) which he never experienced his first year in Georgia.

However Lucas also had plenty of praise.

Even with rising prices, Georgia is still extremely inexpensive by Western standards.

He loved that in Georgia, there seems to be an app for everything— you can easily hire people for all sorts of services, such as food/ goods delivery and odd jobs.

When he first moved to Georgia, the tax program was just being established, and there was a lot of confusion and bad advice.

But now he feels the program is well-established. Expats can find good tax and law firms, along with other groups and service providers dedicated to providing support for foreigners.

Lucas feels like Georgia may be the final stop on many digital nomads’ travels, where they decide to finally settle down and establish some stronger ties. He has seen an influx of families, including new moms and dads who can afford to hire a nanny in Georgia.

For the right person, Georgia’s tax and cost of living savings are worth considering.

If you want more information on how to qualify for the 1% tax rate, Sovereign Man: Confidential members can read our detailed Alert on Georgia’s program here, which also includes information about residency.

And you can check out the Case Study we wrote on Lucas’ experience here.

If you want access to these reports, and our full library of Alerts, Monthly Letters, Case Studies, and Black Papers, join Sovereign Man: Confidential today.

To your freedom,  Simon Black,  Founder, SovereignMan.com

https://www.sovereignman.com/international-diversification-strategies/the-best-tax-deal-in-the-eastern-hemisphere-36077/

Here’s What Everyone Should Be Doing To Fight Inflation

Here’s What Everyone Should Be Doing To Fight Inflation, According to the Top Money Experts

Jennifer Taylor   Sun, July 31, 2022

The current inflation rate is now 8.58%, and Americans are cutting back on spending through strategies ranging from coupon stacking to purchasing store brand items. GOBankingRates asked some of our Top 100 Money Experts for their best tips on how to fight inflation.  From cutting back on non-essentials to creating a financial plan, fight inflation with these expert recommendations.

Start Making Tough Spending Decisions

"Start making tough spending decisions," said Liz Claman, host of "The Claman Countdown" at FOX Business News.

"Go through your daily spending, write it all out, and then slash and burn. Downgrade to less expensive products. Cut out subscriptions you're not using enough. Delete apps that cost money -- even if it's just a few bucks. During COVID-19 lockdowns all the nail salons closed. I have friends who started doing their own nails and got so good at it, they haven't gone back to the salon. That's a weekly savings of $30 dollars. Everything adds up."

Cut Back on Non-Necessities

"Cut back on the non-necessities and find ways to increase your income," said Tonya Rapley, author of "The Money Manual."

Put Your Money Into I Bonds

"Right now, putting your money into Treasury I Bonds, investing in real estate or other alternative investments are the best ways to fight the impacts of inflation," said Danetha Doe, the creator of Money & Mimosas, a website that helps investors.

Add to Your Emergency Fund

Money and career expert Tori Dunlap is the founder of Her First $100K, host of the "Financial Feminist" podcast and author of the upcoming book "Financial Feminist."

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/everyone-doing-fight-inflation-according-230001414.html

Let’s Say You Actually Won The $1 Billion Mega Millions Jackpot. Now What?

Let’s Say You Actually Won The $1 Billion Mega Millions Jackpot. Now What?

(This info could also apply to the RV of the Dinar)

Charlotte Observer  Evan Santiago  Thu, July 28, 2022

This Friday’s Mega Millions lottery drawing has garnered quite the buzz after no winner claimed the prize from Tuesday night’s drawing, with the nationwide jackpot now at $1.02 billion.

It’s an eye-opening amount of money that will undoubtedly change someone’s life forever. The largest jackpot won by a North Carolina resident was a $344 million Powerball jackpot in 2019.

So what is it like to be the one who beats the odds? Van Denton, director of communications at North Carolina Education Lottery, gave The Charlotte Observer a breakdown of what happens if you become a lucky winner.

What are the mechanics of collecting a major prize? When you walk through the door at lottery headquarters, what happens?

Denton: The very first thing after that moment of seeing your win is sign your ticket and secure it in a safe place. You have 180 days to claim your prize. Put together your plan for how you would like your life to change. Get a trusted legal adviser. Get a trusted financial adviser. When you are ready, call lottery headquarters and schedule the day you want to claim your $1 billion. We’ll help you with the planning.

When you arrive, you present your signed ticket. Our staff will verify who you are and that you indeed have the winning ticket. You’ll work out your prize, a $1 billion annuity paid out over 29 years, or (a) cash payment of $602.5 million.

You’ll learn about the mandatory tax withholdings, just like those done on your paycheck at work (at the minimum – withholdings of 24 percent federal and 4.99 percent (in) state). You work out the timing of the wire transfer to your bank, celebrate with lottery staff, and share your story of great luck. And then you’re off on a whole new chapter of your life.

When is the lottery winner revealed? Can that person remain anonymous?

To continue reading, please go to the original article here:

https://news.yahoo.com/let-actually-won-1-billion-110000210.html

Here’s How Much in Taxes You’ll Pay if You Win the $1 Billion Mega Millions

Here’s How Much in Taxes You’ll Pay if You Win the $1 Billion Mega Millions (and Other Fun Facts)

Vance Cariaga    Thu, July 28, 2022

If you’re buying a lottery ticket on the off chance that you might win the $1 billion Mega Millions jackpot this week, you’d do well to remember this: Winning isn’t all Dom Pérignon and luxury suites. You’ll also face a hefty tax bill — so much so that you might have to scrape by on $380 million or so once the IRS takes its cut.

Since nobody took home the grand prize on July 26 by matching all six numbers, the Mega Millions jackpot has now ballooned to $1.02 billion, CNBC reported. The next drawing is Friday night, July 29, at 11 p.m. EST.

It is now the third-largest jackpot in Mega Millions history — and only the third time the jackpot has risen above $1 billion, NPR reported. You have a 1 in 302.5 million chance of winning, which is long odds indeed.

One thing’s for certain: No matter who wins, they’ll be giving a huge chunk of their winnings to Uncle Sam. That’s the case whether the jackpot is doled out as an annuity of 30 payments over 29 years or as an immediate, reduced cash lump sum. Most winners opt for the cash option.

For the current $1.02 billion jackpot, the cash option is $602.5 million, CNBC noted. There is a mandatory 24% federal tax withholding on that amount, which would reduce the winnings by $144.6 million. It would be further reduced by the top federal marginal tax rate of 37%, which applies to yearly income above $539,900 for single taxpayers or $647,850 for married couples filing jointly.

Unless the winner does something creative with the jackpot, such as donating part of it to charity, there would be an additional 13% due to the IRS, for a total of $222.9 million in overall taxes. That would bring the winnings down to about $380 million — and that’s before any state or local taxes might apply.

If the winner is lucky enough to live in a state with no state income tax, this won’t be a problem. Only seven states have no state income tax, according to Intuit TurboTax: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. Of those states, Alaska and Nevada do not have the Mega Millions jackpot.

How to Play the Mega Millions Lottery

To continue reading, please go to the original article here:

https://news.yahoo.com/much-taxes-ll-pay-win-160121288.html

Why Lottery Winnings Don’t Always Lead To Happiness

Why Lottery Winnings Don’t Always Lead To Happiness

Shirin Ali | July 27, 2022

Story at a glance

Winning the lottery may increase a person’s life satisfaction and remain that way for decades to come.

An increase in happiness isn’t as certain, with research showing lottery winners showing little to no improvement there.

Researchers say happiness is subjective and is interpreted differently from person to person.

Receiving a massive influx of cash may seem like instant gratification but research has shown that winning a lottery may increase life satisfaction but may not impact general happiness.

The odds of winning a Mega Millions jackpot is one in 303 million — while the odds of winning at least $1 million are about 1 in 12.6 million.

For the lucky few who do manage to snag a winning ticket, they will likely experience an increase in life satisfaction that can persist for over a decade, with no evidence of that decreasing over time.

However, the effect on a person’s happiness and mental health after winning a lottery is more mixed, with research showing increases are usually smaller and not statistically significant.

Those are findings that researchers from New York University and Stockholm University in Sweden came to after studying over 400 people who had won lotteries in Sweden from 1998 to 2011.

America is changing faster than ever! Add Changing America to your Facebook or Twitter feed to stay on top of the news.

“We find that winning large sums of money strongly affects how content you are with your personal finances. But it does not affect how you feel about other aspects of life, such as your health, or your relationships with friends and family,” said Erik Lindqvist, one of the researchers behind the study.

Lindqvist’s team found clear evidence that wealth improves people’s evaluation of their lives as a whole— suggesting that improved financial circumstances is an important component behind increasing people’s life satisfaction.

To continue reading, please go to the original article here:

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Here’s How To Build a 6-Month Emergency Fund

Here’s How To Build a 6-Month Emergency Fund

Nicole Spector   Wed, July 27, 2022

We may be a country sorely lacking in financial literacy, but we all have one core principle ingrained in us: We must have an emergency savings fund.

In theory, it sounds pretty simple: You make a certain amount of income, and set a certain amount of that aside in an account that you only tap into when the going gets especially tough and you need to shell out dough for something like a new car part or a surprise medical bill. But embarking on building a six-month (the recommended amount) emergency fund can be challenging.

Where do you begin? With the help of finance experts, we've laid out a multi-step plan of attack.

Go In With the Right Mindset

"Saving is primarily a mental game that you can win," said Adam Garcia, founder of The Stock Dork. "Setting away even a tiny amount of money on a regular basis can eventually lead you to your objective, no matter how low your starting point is. Time and a little self-control are all that is required."

Get an Accountability Partner

"The journey to starting and faithfully contributing to an emergency fund is more successful when done with a partner," said Lucia Jensen, CEO of WeLoans. "Consider working with your financial advisor to help you stay on track."

Map Out Your Spending

"Take the time to distinguish what your necessary expenses are, and what your discretionary expenses are (i.e. streaming services, shopping for clothes)," said Katie Ross, EVP of American Consumer Credit Counseling (ACCC). "If you're in a tight spot financially, you may want to cut out some discretionary spending. Your emergency fund should cover your essential needs. After you calculate your total expenses for one month, multiply that number by six. The final number is how much money you should have for your six-month emergency fund."

Rethink Subscriptions and Sign Up for Promotions

"Whether it's your cable company, cell phone provider, or gym membership, it's time to rethink the value of your subscriptions to their services," said Owen Wilcox, co-founder of USInstallmentLoans. "You have probably forgotten about other subscriptions, yet they continue charging monthly fees. Consider canceling, putting some on hold, or renegotiating the deals to free up critical funds to be redirected to your emergency fund."

Start Setting 5%-10% of Your Paycheck Aside

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