Comments on: Going Broke on $200,000 a Year: Step by Step Process of Going Down with a High Salary.

By: cariqunyil

cariqunyil — Wed, 28 May 2008 01:26:50 +0000

Figure in the cost of DVDs, hobbies, travel (vacation related), gambling, and other pursuits of the rich and famous, and you can easily spend $1000/month.

By: Emmi

Emmi — Tue, 27 May 2008 20:23:36 +0000

>Add FICA and medicare and SDI (although lucky him he’s in the bracket where some of these taper off). I figure if my 25% federal tax bracket with all the other taxes means I’m paying 44% of my marginal income in taxes, that he’s probably paying equal or a bit more, and on most of his income.

He’s only paying 1/4 the social security I am (I pay double as self-employed and he pays half because he’s way way over the cutoff where he gets to stop paying). He doesn’t pay income tax on his health benefits (and neither does his company, btw) but I do (on insurance purchased as individual). My marginal tax rate was 50%. He’s in the system and gets a pile of nice benes for that, so now he gets to deal with the downside of having to make his own way. Some of us do that every day, so we don’t have much sympathy especially when the claim of “I was taxed to death” crops up.

But that aside, this rabid anti-tax thing is getting terribly old. I don’t have any kids, so I don’t have to try to explain to my grandkids why we partied irresponsibly for decades instead of having the balls to pay down the national debt. Some people seem to treat it as a badge of honor that we’re screwing over the next three generations of Americans. I personally do not. Everyone should be paying their fair share, especially people who are going to cost the system more than their fair share when they take a fall.

By: Chris in Cali

Chris in Cali — Tue, 27 May 2008 16:00:22 +0000

How the hell did the discussion wander off into Left/Right “Global Warming Hoax” talk? Isn’t this a housing blog? Anyways, I work with young people like the example… they are not rare and the recession will teach them a lesson. It’s the same lesson people my age learned in the late 1980′s/early 1990′s… what goes up, must come down… do your best to be prepared. This guy will survive. He may never make that kind of money again, but he will survive.

By: js

js — Tue, 27 May 2008 15:46:52 +0000

Emmi? 33% tax bracket? How you figure? Well, yes IF the only taxes you count are federal income taxes he’s in the 33% bracket and yes that rate used to be higher on top earners but other taxes used to be lower (and of course that kind of money also used to buy a LOT more, now it makes you able to afford a house in southern CA, whoop de do).
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But really add 10% CA state taxes on top of that 33%. Add FICA and medicare and SDI (although lucky him he’s in the bracket where some of these taper off). I figure if my 25% federal tax bracket with all the other taxes means I’m paying 44% of my marginal income in taxes, that he’s probably paying equal or a bit more, and on most of his income. And he’s single with no kids – so not a lot of deductions there other than the house. My point is taxation is high. But even so taxes are absolutely NOT at all the reason for his downfall. Not with that kind of NET income. It’s the voluntary spending, including being a homeowner.

By: Cod Peace

Cod Peace — Tue, 27 May 2008 14:31:33 +0000

I know the personality type you describe here – a friend of mine became a Hollywood agent and was living the high life for a while. Heck, one year his bonus was larger than my entire near 6-figure salary. He was over $50k in debt from living it up, driving the leased BMW, etc etc. And that was with expensing a ludicrous amount of entertainment. He finally got his act together when he met his future wife and decided that massive indebtedness was not going to impress her.