Anonymous
11/21/2018 12:28
Subject: Where are all the high income folks?
Anonymous wrote:Anonymous wrote:Anonymous wrote:So what's your effective tax rate, PP?
You are clearly an exception re:income - according to a quick search, there are less than 20k Americans who have an AGI of over $2mm annually. And relatively speaking, you still haven't accumulated *that* much wealth based on your net assets (that's a lot of debt).
I worked in PWM with global 1%-ers, family offices, the whole shabang, and most of the time we were talking $100m+ in net assets. Though clearly you've done incredibly well for yourself and that's nothing to sneeze at...
You're still wrong, though. High income (if we're talking millions) can go along with high wealth, sure, but more often than not, if the wealth is very substantial then you're talking low income taxes based on low earned income. That's why people are talking about introducing a wealth tax instead of income tax.
Piketty explains this concept well: https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Century
Agreed. It's virtually impossible to attain a net worth that qualifies for PWM purely through salary & bonus income. Perhaps the only people who can are celebrity entertainers & athletes. For everyone else it comes through a business, whether it's owning real estate or a company, early start-up employee, owning a patent/inventor, stock options/grants, carried interest, partner in a business or firm, etc.
This is true. DH earns about $2m per year, mostly in bonus that is on his w2. We get taxed at the highest rate. We are savers but we will never be high net worth. We don’t come from family money. We live a very good lifestyle and we will be able to retire but we will never be rich.
We are similar to you. We have had a HHI of ~$2M for about the last 6 years due to stock and signing bonuses. Net worth of $15M. We live very upper-middle class with a lot of saving and simplified living. Our financial planner projects that if we continue spending wisely, retire at 55 (we are 46), and Democrats don't crash the market with regulations, we will die with $50M+
Taxes kill us. With wages and income from three investment properties, I think our tax rate was 32%.
Anonymous
11/08/2018 10:36
Subject: Where are all the high income folks?
Anonymous wrote:
I can't believe a graph that says the lower level top 5% of Manhattan incomes is $250k or that the median is $800k.
Who's buying all the $5 million dollar apartments? who's sending kids to $50k a year private school? who do all those $100k luxury cars on the upper east & west sides in belong to? who do all the boutiques sell to?
Why do people making $500k+ a year say they can't afford the city?
This should be good
NP.
PP, you are not very bright. have you noticed how many tourists are there in Manhattan every single day? people from all over the world with tons of money.
Anonymous
11/07/2018 22:13
Subject: Where are all the high income folks?
Anonymous wrote:Anonymous wrote:So what's your effective tax rate, PP?
You are clearly an exception re:income - according to a quick search, there are less than 20k Americans who have an AGI of over $2mm annually. And relatively speaking, you still haven't accumulated *that* much wealth based on your net assets (that's a lot of debt).
I worked in PWM with global 1%-ers, family offices, the whole shabang, and most of the time we were talking $100m+ in net assets. Though clearly you've done incredibly well for yourself and that's nothing to sneeze at...
You're still wrong, though. High income (if we're talking millions) can go along with high wealth, sure, but more often than not, if the wealth is very substantial then you're talking low income taxes based on low earned income. That's why people are talking about introducing a wealth tax instead of income tax.
Piketty explains this concept well: https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Century
Agreed. It's virtually impossible to attain a net worth that qualifies for PWM purely through salary & bonus income. Perhaps the only people who can are celebrity entertainers & athletes. For everyone else it comes through a business, whether it's owning real estate or a company, early start-up employee, owning a patent/inventor, stock options/grants, carried interest, partner in a business or firm, etc.
This is true. DH earns about $2m per year, mostly in bonus that is on his w2. We get taxed at the highest rate. We are savers but we will never be high net worth. We don’t come from family money. We live a very good lifestyle and we will be able to retire but we will never be rich.
Anonymous
11/07/2018 08:20
Subject: Where are all the high income folks?
My income is so high Jeff Bezos is my dog walker.
Anonymous
11/06/2018 21:58
Subject: Where are all the high income folks?
Anonymous wrote:Anonymous wrote:Anonymous wrote:You can make a ton of money and still think certain things are a lot of money.
My parents have an HHI of $1M or so and a net worth of several million. They own property in Manhattan. My mom still won't usually pay for Acela tickets to go from NYC to BWI because she thinks they're too expensive.
Sorry to break it to you, $1M isn't much in Manhattan anymore
Oh, FFS. A HHI of $1M is at the 99.8% percentile nationwide, meaning only 252,440 households make more than this in a year. Manhattan has 748,293 households. Thus, even if literally every one of the 248,293 wealthiest households in the US were in Manhattan, an income of $1M would still be in the top third.
Ordinary income is for chumps.
Anonymous
11/06/2018 19:52
Subject: Where are all the high income folks?
Anonymous wrote:So what's your effective tax rate, PP?
You are clearly an exception re:income - according to a quick search, there are less than 20k Americans who have an AGI of over $2mm annually. And relatively speaking, you still haven't accumulated *that* much wealth based on your net assets (that's a lot of debt).
I worked in PWM with global 1%-ers, family offices, the whole shabang, and most of the time we were talking $100m+ in net assets. Though clearly you've done incredibly well for yourself and that's nothing to sneeze at...
You're still wrong, though. High income (if we're talking millions) can go along with high wealth, sure, but more often than not, if the wealth is very substantial then you're talking low income taxes based on low earned income. That's why people are talking about introducing a wealth tax instead of income tax.
Piketty explains this concept well: https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Century
Agreed. It's virtually impossible to attain a net worth that qualifies for PWM purely through salary & bonus income. Perhaps the only people who can are celebrity entertainers & athletes. For everyone else it comes through a business, whether it's owning real estate or a company, early start-up employee, owning a patent/inventor, stock options/grants, carried interest, partner in a business or firm, etc.
Anonymous
11/06/2018 19:48
Subject: Where are all the high income folks?
Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:You can make a ton of money and still think certain things are a lot of money.
My parents have an HHI of $1M or so and a net worth of several million. They own property in Manhattan. My mom still won't usually pay for Acela tickets to go from NYC to BWI because she thinks they're too expensive.
Sorry to break it to you, $1M isn't much in Manhattan anymore
They're doing just fine. They have a beautiful apartment in a completely renovated pre-war building and just bought a Steinway baby grand.
Also, these graphs would suggest that $1M is still quite good: https://statisticalatlas.com/county-subdivision/New-York/New-York-County/Manhattan/Household-Income
I'm wondering just how you got that idea, seeing how the graph tops out at $250k
The graph shows that $250k is in the top 5% of household income in Manhattan. So it stands to reason that $1M, which is higher than that, is "still quite good," as PP said. How is this confusing?
I can't believe a graph that says the lower level top 5% of Manhattan incomes is $250k or that the median is $800k.
Who's buying all the $5 million dollar apartments? who's sending kids to $50k a year private school? who do all those $100k luxury cars on the upper east & west sides in belong to? who do all the boutiques sell to?
Why do people making $500k+ a year say they can't afford the city?
This should be good
Not pp, but you realized that there's a difference between assets and income, and that rich people have an incentive (taxes!) to minimize "income?" Charts that show income have very little to do with wealth. This is why trying to correlate average income to real estate prices doesn't work in high end neighborhoods.
Where do you think the money to get the assets come from
I find it a much better than relying on census figures as you do
I doubt many people are committing such tax fraud on a massive scale
Are you seriously that naive? The 0.1% hasn't built their assets from "income" in decades/ centuries. These are the families that built America - they were investors in the Erie Canal, they sold shovels to the 49ers, and for the "newer" ones, they're tech entrepreniurs who patented software early in the dot com era, etc (all three examples of real families I know).
Income is for the schmucks who haven't/ cannot escaped the system. Compounding for decades is where the real wealth is, and typically, the taxes at this level are closer to 5-10% depending on the quality of your accountant team.
This is completely true.
I can't count the number of times I've heard my dad (longtime NYC lawyer) say the following: "Gotta call my guy at Morgan Stanley to figure out how we're going to handle this new tax legislation." He's never did anything illegal, but his Morgan Stanley guy has always helped him lower his taxes as much as the law would allow.
This is completely wrong. High income and high assets go hand in hand. Sorry to burst your bubble
- HHI of 3.8M. Assets of 38M
Yes but how much of your HHI is earned income? My guess is you must have had a good amount of one of the following: partnership income, capital gains, rents & royalties income, investment income to get to $38m. Either that or you must be in your 50s or 60s and had a very high earned income for many years. Even at $3.8m in earned income, after tax is $1.9m and let's say you spend $500k annually which would be modest on that level of income if you have children then you save $1.4m. Would take 27 years if no investment gains so call it 20 years to save $38m.
2.2m earned income, 38m assets, 15m debt.
After tax: 2.5m
You know how I got so many assets? I took my income, and invested in them (not pulled out of my ass as you seem to believe).
There is no secret here. High income - buy assets - invest returns - repeat.
I'm not trying to upset you. I never suggested your assets appeared out of nowhere--perhaps you're having a bad day... I'm just trying to make the point with the poster above that it is hard to generate UHNW based on earned income. Most people who have net worths in the tens of millions+ get their through participating in business gains (through any of the categories of income I mentioned above) as it's very hard to get their through earned income given taxes and inevitable income fluctation over a long period of time. TBH, I think your post proved my point. Over 40% of your HHI is non earned income.