It’s 2016 but back in 1995 when I was in my 20’s, I had the guy I was doing some contract work for asking me. What would solve all your problems, Emmitt?. I looked at him hesitantly, and replied: “Why?”. I can’t remember the guy’s name but I do remember this exchange clearly. He said to me, “I just want to know”.
I figured what harm could be caused by answering the man’s question. So I replied “Have $1,000000.00 given to me. That would solve all my problems.
The guy said to my reply, “Are you sure $1,000,000.00 if so I’ll tell you why it is not, and why it will cause you more problems”.
Let’s say you win or are given $1,000,000.00 tomorrow morning.
1.) The government will tax you at a High tax bracket from somewhere between 40% -64%. Leaving you with approximately $519,000 -$649,000
2.) Since you are the Average American, you will most likely buy a house that pleases you and definitely please your wife. That will cost you approximately $275,000 to $310,000
3.) Since you purchased the house you will have to get new transportation. So you and your wife are going to get new cars. 2x$60,000.00 = $120,000.00
4) Since you have a new home you will have to put furniture and populate your new house, let’s say $50,000 for populating your house and that is being generous. would leave you with $74,000.00 and still have not paid off your other credit cards and debts. So you still need to have a job for income and are only a little better off than before you obtained the initial $1,000,000.00.
There were other statements, but he said to me. Here was my takeaway from that verbal exchange. Without understanding life is about learning, experience and managing your lifestyle, no amount of money can change your life if you are not control of your life before you obtain the money.
“Having a little more money than you need at any moment, money supply simply remove a few worries but does not solve all problems.” Emmitt Muckles
Now go live YOUR Billionaire Lifestyle.
Salary and Tax Illustration taken from http://www.taxformcalculator.com/tax/1000000.html
|Yearly||Monthly||4 Weekly||2 Weekly||Weekly||Daily||Hourly||%|
|–||Tax Deferred Retirement||0.00||0.00||0.00||0.00||0.00||0.00||0.00|
|–||Federal Income Tax||349,655.15||29,137.93||26,896.55||13,448.28||6,724.14||1,344.83||180.51||34.97%|
|–||California State Income Tax||109,297.56||9,108.13||8,407.50||4,203.75||2,101.88||420.38||56.43||10.94%|
|Take Home Pay||519,094.29||43,257.86||39,930.33||19,965.17||9,982.58||1,996.52||267.99||51.91%|