Site thinks I am Slidai trying to constantly DP me today.
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Inflation is rolling over
- Thread starter Klaus
- Start date
I'm seeing sub 2k mile CFTP cars @ 97-99k already.
Base models are dipping high 70s in real time.
Lot of folks dumping them to move onto the c8 Z06.
It's no longer the clout car.
And that should have been expected, considering the release of the vehicles, time of year and the current economic pattern.
-J
They played the system and can just walk away. Yourself on the other hand has equity tied up in your home. If you wanted to sale and just walk away from your 300% increase it would turn into a 50% loss because of capital gains. Of course you can leverage the equity in your house, and risk losing it all. Looks good on paper though, reminds me of Bitcoin.
Capital gains are the true shackles of the Middle class. You can't just throw in the towel without losing. You took all the risks. The banks and Uncle Sam love you though!
Overreliance on income is the vulnerability of the middle class.
Cap gains are taxed at a lower rate and it is super easy to manage the tax burden of cap gains.
Income is taxed at a higher rate and tax rates are progressive. The more you earn the greater your tax burden. At high income levels it is extremely difficult to shelter income.
If you are asset rich you can borrow against your assets to pay yourself a tax free income.
Those that are truly wealthy have little or no actual income. The worst position to be in is high income/low asset. Those with high income and no assets really are not wealthy. At certain level, income tax is really a schmuck tax.
PS check out 1031 exchanges. These provide a window to trade cap gains into another asset on a tax free basis. Say you buy a property for 100 and sell it for 200. You can use the entire 200 to purchase a new property via 1031.
Aside from the 1031 exchange- what are these super easy strategies you mention?
I would recommend getting a smart accountant if this is an issue. There are many many many ways to defer/shelter cap gains.
An obvious one is to borrow rather than sell.
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My next move I will dump every bit of money I make on my current home into the next. So taxes are not an issue.
My math may be off but, I think a quarter midget is a garden gnome.
As far as I know, if single, you can avoid cap gains tax on the first 250k of profit of a home sale and if married it is 500k.
You can no longer 1031 exchange personal assets, house/vacation house (unless you rent out the vacation house which makes it a business asset). 1031s are great for business assets though.
But like Vegas said you get a 250/500k exclusion of tax if its your primary home. Above that you have to pay long term capital gains which is 0%/15%/20% depending on income level.
This.
Also, I find it difficult to understand why people venture into careers they know aren’t viable throughout fluctuations in the economy…
And when they do, they don’t plan accordingly to adjust for said fluctuations.
Certain jobs are a MUST.
Others are a luxury.
Which do people cut first when the shit gets tight?
Borrowing against your brokerage account to buy your toys rather than yanking money out I hear works.
Yup, just read a report on this. Some numbers from the 2 biggest colleges in the state. Of course getting into the trades can also be very profitable
^Imagine that. Generally speaking, "fluffy" majors aren't in demand and therefore don't amount to jack squat in the long term. "But I have a degree in spelunking! What do you mean I didn't get the engineering position?!"
I’ll never understand the allure of college versus the trades… TONS of money to be made if you’re good at what you do.
Yes, I understand your plan, as that was the model I followed. I also had several commercial properties with partnership on one. Capital gains had to be paid upon sale or the partnership would have to continue under the 1031.
My comments are pertaining to my particular situation. If I wanted to say I'm done before retirement age, it would cost me dearly. The lures of big homes and big equity is a trap. When calculated the mortgage interest rates, personal property taxes, insurances I've paid over 40 years it's crazy.
Trades require physical labor, common sense, problem solving, ingenuity, and skill. More importantly, they require effort and time to master. A liberal arts degree requires trading student loan debt for a fancy receipt from *insert university name here* and a convincing story about how you could earn $xxxxx with said degree.
Boy am I getting crotchety these days. lol
FIFY.
"You can HAVE TO use the entire 200 to purchase a new property via 1031." I did this twice when I escaped SOCAL in 2016.
I think it depends on the person. I have an engineering degree myself but when my son is looking at what to do after high school I will present the trades as a viable alternative to what I would consider a "useful degree" from college.
The idea of starting work immediately and 4-5 years later getting a journeyman's card as a plumber, electrician, lineman, carpenter, welder, mechanical installer, etc and having no debt and a strong income, certainly appears to be more favorable than even an engineering degree and a mountain of debt.
In the oil field.. when things are good. Companies PRIDE themselves on their safety.
When things are bad.. first thing cut…..
….. safety
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