What do you consider rich?

[vern_humphrey]

Actually a dollar bill has value only because we believe it has value. The fact that we carry money is an act of faith.

That’s correct – we agree a dollar has a certain value in terms of goods and services.

Owning a house doesn’t increase your cash income, but your total income (both in kind and cash) is higher because you own a house.

Is your total income (both in kind and cash) higher because you own a pair of shoes? Or a new six-pack of boxer shorts?

 

[stinkcat_14]

Is your total income (both in kind and cash) higher because you own a pair of shoes? Or a new six-pack of boxer shorts?

My total income is higher because of a lot of the durable goods that I own. Housing is no different, we just focus on it because the in kind income people get from owner occupied housing is not insignificant. The government estimates imputed rent at $50 billion per year.

 

[Proletarian]

So should I solve the world’s poverty by divesting myself of my money? Get real. Quit distorting.

Yeah, what was I thinking!

**Deut. 15:7. **
If there is a poor man among you, one of your brothers, in any of the towns of the land which the LORD your God is giving you, you shall not harden your heart, nor close your hand to your poor brother; but you shall freely open your hand to him, and generously lend him sufficient for his need in whatever he lacks.

James 2:14-16
What doth it profit, my brethren, though a man say he hath faith, and have not works? can faith save him? If a brother or sister be naked, and destitute of daily food, And one of you say unto them, Depart in peace, be ye warmed and filled; notwithstanding ye give them not those things which are needful to the body; what doth it profit?

1 John 3:17
If anyone has material possessions and sees his brother in need but has no pity on him, how can the love of God be in him?

**Luke 12:33. **
“Sell your possessions and give to charity; make yourselves purses which do not wear out, an unfailing treasure in heaven, where no thief comes near, nor moth destroys.”

Luke 3:11
And [John the Baptist] would answer and say to them, “Let the man with two tunics share with him who has none, and let him who has food do likewise.”

Mt. 5:42.
Give to him who asks of you, and do not turn away from him who wants to borrow from you.

So what is your advice to the poor of the word? What do you recommend be their course of action to get out of poverty?

I thought my post was pretty clear; the cycle of poverty means that they are unable to do anything to better their situation. The obligation is upon those with resources to share, instead of gratifying themselves at the expense of others. I pray that when you come before God he will have more mercy for you than you did for your neighbour.

 

[Texas_Roofer]

This is a common misunderstood if the person is 50 with $2 million then he could equal the cash flow to a person making $50,000 with company benefits, and his wealth would grow. You need to understand many things (1) the $50k employee only handles about $36k (2) The employee gets about 6-12k in medical insurance subside (3) The retire can usually can avoid taxes better

50 yr___employee__Retired employee
cash 50k______50k___$18+12k
taxes 14k______14k____$2k?
Ins 14k_______4k $2k
401k$0______3.5k$0
$28k$30k____$26k

Notice Our “rich guy” needs about $1,000,000 as a minimum so he can pull 5% per year. At a 5% pull he should increase is net worth every year. For example a normal moderate risk investment should produce 7-7.5% return thus he should gain about $20,000-$25,000 of net worth. Our employee should have equal cash flow however he must work 2,100 per year to get that money and incur expanses like increased car use, proper clothing, etc. Our regular retiree has the similar cash. He gets $12k social security plus the medicare. Thus he needs only about 18k to maintain thus 5% of a $360,000 investment. Notice the dramatic affect of Social Security and Medicare.

The problem with this is no one seems “rich” so Vern’s $2,000,000 base does appear a good estimate. The $2,000,000 would support $100k which should allow about $58k in spending cash which is close to twice what others have.

 

[Texas_Roofer]

Allow me to explain. You are receiving regular payments throughout the year, with the annual total being $2,000,000. You deposit each payment in an interest-bearing account at 5%.

At the end of the year, the** first** dollar you deposited has earned 5% – because it’s been in the account all year. The **last **dollar has earned 0% – because it was just deposited.

The mean of the two is 2 1/2%. And 2 1/2% of $2,000,000 is $50,000.

Your income is $2,000,000 a year, and the income of your income (which was J.P. Morgan’s standard) is $50,000.

They may say this however it is not correct. No one is required to invest their money in the super low risk options. The real misleading part is the concept of using tax free bonds and yet needing enough money to pay the taxes. $2,000,000 in low to moderate investing should produce over $11,500 per month(7%). So our man could charge everything up to $11,500 per month then transfer over the balance at the end of the month to the card. Our man would slightly gain in net worth and could continue this method forever.

 

[Pug]

Housing is no different, we just focus on it because the in kind income people get from owner occupied housing is not insignificant. The government estimates imputed rent at $50 billion per year.

Surely the “savings” a person might derive from owning a house rather than renting depends on how you acquired it, how long you hold it, where you live, the cost of rent in your area, whether you benefit from the tax deduction, how handy you are and how much free time you have, etc. The monthly payments on a 30 year mortgage can exceed rent for a modest apartment. Of course, you will own the house at the end and you will enjoy the physical benefits of a house over an apartment, but then, you could have invested the difference between the payment and the rent all those years, which can turn into a pretty penny.

And no, I don’t really want to attempt to unravel you two’s fine distinction argument about income. :ehh:

 

[stinkcat_14]

Surely the “savings” a person might derive from owning a house rather than renting depends on how you acquired it, how long you hold it, where you live, the cost of rent in your area, whether you benefit from the tax deduction, how handy you are and how much free time you have, etc. The monthly payments on a 30 year mortgage can exceed rent for a modest apartment. Of course, you will own the house at the end and you will enjoy the physical benefits of a house over an apartment, but then, you could have invested the difference between the payment and the rent all those years, which can turn into a pretty penny.

And no, I don’t really want to attempt to unravel you two’s fine distinction argument about income. :ehh:

You are absolutely right. Your actual amount of imputed rent depends upon all of those things. Nor is owning a house the best idea for everyone. I know a wealthy guy who lived in apartments all of his life, put his money in stocks, and spent his free time on the golf course. There can be many advantages to renting.

 

[Minnesota_Mary]

Yeah, what was I thinking!

I thought my post was pretty clear; the cycle of poverty means that they are unable to do anything to better their situation. The obligation is upon those with resources to share, instead of gratifying themselves at the expense of others. I pray that when you come before God he will have more mercy for you than you did for your neighbour.

When was the last time you counted my money? How do you know whether or not I give enough to charity?

Like Judas, you seem so concerned about the poor. I hope you are dipping deep into your own resources to help the poor instead of expecting others to do your idea of charity through government confiscation.

Our Lord said, “The poor you will always have with you.” Sounds like a problem that will never be eliminated to me. Christ never advocated a Roman welfare state.

 

[Proletarian]

When was the last time you counted my money? How do you know whether or not I give enough to charity? .

Because you told me,“So should I solve the world’s poverty by divesting myself of my money? Get real. Quit distorting.” You clearly resent having to part with your material possessions to help the poor.

Our Lord said, “The poor you will always have with you.”.

I’m sure they will, perhaps Christ predicted that many would ignore his words; Its interesting that when quoting my post you removed all the Scriptural references. By the sounds of it you have no qualms ignoring those parts of the Bible (the words of Christ himself) that command unlimited generosity.

 

[Al_Masetti]

Poor people are folks who get paid by the hour … no “billable” hours worked, no pay … regardless of the dollar amount per hour.

If they want to get paid, they have to put in the hours. They have to account for their hours.

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Middle class have flexibility in their work. They manage the assets of rich people. They are paid an annual income. No time sheets. The get paid for results or for the position they hold. But they don’t have to account for each hour of their time.

They may travel around in LearJets, but Learjets are uncomfortable: low ceiling heights; can’t really walk around (you sort of scuttle around). The smaller models don’t have a private toilet.

---

The rich: Have staffs of lawyers and accountants and lobbyists. They influence legislation to suit their own purposes. They have trusts so that they cannot be sued successfully and their income is so well hidden and shielded that they pay very little actual taxes.

When they travel, they use converted airliners. Lots of walk-around room. Very comfortable.

---

The income tax was originally only supposed to be paid by the top 1% of earners.

Ask yourself, what is the maximum that anyone should pay in taxes. Combined Federal, state and local taxes. All government taxation. Social security, real estate, sales taxes, so-called luxury taxes, utility taxes, income taxes, corporate taxes. What percent of their income should they pay in all taxes.

There was a survey released recently (Harris Poll) that 15% is the number selected by most respondents; some respondents went as high as 22%.

The real average percent of income paid in taxes is 33%. And some folks pay as high as 50%.

Following is a link to the Harris Poll that I cited. The specific information on beliefs regarding tax percentages is on page 6.

209.85.165.104/search?q=cache:8iIebGOGX0UJ:www.taxfoundation.org/files/survey_summary-20060405.pdf+harris+poll+individual+tax+rates&hl=en&ct=clnk&cd=5&gl=us

Or search Google for this 2006 poll.

 

[stinkcat_14]

Poor people are folks who get paid by the hour … no “billable” hours worked, no pay … regardless of the dollar amount per hour.

If they want to get paid, they have to put in the hours. They have to account for their hours.

I have a friend who does consulting on the side, he bills out at $300 per hour. So you are saying that he is poor?

 

[Al_Masetti]

I have a friend who does consulting on the side, he bills out at $300 per hour. So you are saying that he is poor?

If he doesn’t work, he doesn’t have any money.

He HAS to work.

If he doesn’t work, he will have no income.

So yes, he is poor.

You have to understand, that on this thread, we may have a bunch of poor people quibbling over a definition of who earns the most money.

And we may be on the edge of “envy” … we are so “worked up” that someone may be making more income than us, that our teeth go on edge. And we may strive to bring them down to our level.

Also, we need to make a distinction between income and assets. Income & expense is totally different from assets & liabilities. [Do you understand the difference?]

The concept of “rich” usually relates to the amount of assets a person has.

If someone is able to bill $300 per hour, then we need to figure out what their secret is and admire and emulate their ability. Unless of course, they are doing something totally immoral.

I remember getting admonished because someone in our company had a high billing rate; but it turned out that the company had a high overhead burden (rent, marketing, proposal writing, payroll prep, medical benefits, liability insurance, purchase of equipment, travel expenses, personnel, pension liability, interest expense, admin, fringes, down time, etc, and a lot of time that could not be billed) , so the amount my friend actually got was only about one-fourth of the billable amount.

God Bless your friend for being able to bill that rate.

[How many hours a year does he actually bill? One hour or 2000 hours? How much time does he expend that is non-billable?]

The rich have no need to work. They don’t “earn” money. They own large amounts of stuff. And they have staffs of people to “maintain” their rich status for them.

Nevertheless, we have no right to envy (desire to take away) the assets of rich people.

 

[stinkcat_14]

If he doesn’t work, he doesn’t have any money.
He HAS to work.
If he doesn’t work, he will have no income.
So yes, he is poor.

Actually, this is his side job on top of his regular job as a college professor, where he makes $100k per year.

Also, we need to make a distinction between income and assets. Income & expense is totally different from assets & liabilities. [Do you understand the difference?]

If I didn’t understand the difference, I should be fired from my job teaching corporate finance. However, in the US, we measure poverty primarily as income, although the government does take into consideration assets in some situation. But the poverty level measure is an income measure.

If someone is able to bill $300 per hour, then we need to figure out what their secret is and admire and emulate their ability. Unless of course, they are doing something totally immoral.

Very simple, get a Ph.D in economics and work for lawyers estimating the value of someone’s life in wrongful death cases.

How many hours a year does he actually bill? One hour or 2000 hours?

I don’t know how many hours he actually bills, but he is constantly going to court. I would guess 10-20 hours per week would be an average. Some in my department suggest that he is shirking his full time job to do the consulting, although there certainly can be a bit of jealosy there. Its hard to tell because we only have to be on campus 17 hours per week and it is hard to tell what people do the rest of the time.

 

[gell]

From a financial perspective and as a Australian living in Sydney, I kinda think of it like a scale.

It’s pretty much (generally):

• Stinking rich: People that own multi million dollar houses, boat etc.
• Rich: People that own a multi million dollar home and have other expensive luxuries (but not enough to justify the purchase of things like a multi million dollar boat)
• Wealthy: People whose assets easily exceed $1 million.
• Well-off: People whose assets assets are around the $1 million mark but not higher than $2 million.
• Average: People who have a decent home, car etc.
• Poor: People who have very little money in the bank and do not have a nice home, car etc.
• Homeless:

Of course, money doesn’t buy you happiness! (but poverty doesn’t make you happy either). From my scale, you are probably thinking that I think too much about it. You are probably right!

However, I also like to be able to understand what people mean when they say, “X person is rich”. You have to understand that I live in a family that would fall in the “wealthy” category. So we are definitely not poor (well I technically am… but I still live at home ), and have a higher than average income, but I definitely wouldn’t consider this as being “rich”. We are upper middle class.

So many labels lol.

 

[Minnesota_Mary]

Because you told me,“So should I solve the world’s poverty by divesting myself of my money? Get real. Quit distorting.” You clearly resent having to part with your material possessions to help the poor.

**I never said I was wealthy here nor do I resent giving to the truly poor. What I resent is having others like you, who operate out of envy, telling me and others that we should feel guilty for what we have earned and saved for our old age and our children. I resent having the heavy hand of the government extract from my income to redistribute it to a bunch of bureaucrats who want to keep the poverty problem going so they have job security. If the bishops really wanted to help the poor they would have programs teaching them how to be good stewards of what they have been given and how to live Godly lives that will keep them from a host of problems. They would teach them about the benefits of saving and investing and how to invest so they too can have financial security.

There are a lot of poverty pimps in the Church. They talk about the poor, but the ones they are really concerned about are themselves. They aren’t working in the Church for peanuts. **

I’m sure they will, perhaps Christ predicted that many would ignore his words; Its interesting that when quoting my post you removed all the Scriptural references. By the sounds of it you have no qualms ignoring those parts of the Bible (the words of Christ himself) that command unlimited generosity.

I had to remove all of your scriptural quotes because I am limited to the number of characters I can type in here. They were already visible on your original post. I take the Bible in entirety and don’t limit myself to a few quotes. By the way, I do tithe.

 

[Proletarian]

If the bishops really wanted to help the poor they would have programs teaching them how to be good stewards of what they have been given and how to live Godly lives that will keep them from a host of problems. They would teach them about the benefits of saving and investing and how to invest so they too can have financial security.

Have you actually inquired into this? Or are simply justifying your own self indulgence?

I happen to work for the Church’s social services arm as a case worker (among other things) and I can tell you that the vast majority of the Church’s resources are funnelled into such programmes.

Please do not slander the Church with these lies…

 

[vern_humphrey]

My total income is higher because of a lot of the durable goods that I own. Housing is no different, we just focus on it because the in kind income people get from owner occupied housing is not insignificant. The government estimates imputed rent at $50 billion per year.

Your net worth may be higher, but your income is not. You can’t spend your shoes or your house.

 

[stinkcat_14]

Your net worth may be higher, but your income is not. You can’t spend your shoes or your house.

I can consume my shoes, so the consumption services that I receive from my shoes would count as a form of in kind income. Once again, income is not restricted to cash income. For example, my health insurance that I receive from my employer is a form of in kind income. If I were to quit my job and start my own business, I would have to pay for my own health insurance, which in my case for myself alone would be $6,000 per year. The fact that my employer pays for it makes it part of my income, but not part of my cash income.

 

[colverpa]

all my bills are paid and i have alittle left over

 

[vern_humphrey]

I can consume my shoes,

How do you cook them?

so the consumption services that I receive from my shoes would count as a form of in kind income.

Nope – whether you eat them, wear them, or peform acts best not mentioned here with them, they are not income.

As Lincoln pointed out, it doesn’t matter what you call it, a tail is not a leg.

Once again, income is not restricted to cash income. For example, my health insurance that I receive from my employer is a form of in kind income. If I were to quit my job and start my own business, I would have to pay for my own health insurance, which in my case for myself alone would be $6,000 per year. The fact that my employer pays for it makes it part of my income, but not part of my cash income.

Yes – job-related benefits are indeed income. But shoes are not.