The Wealthy Have 'Worked Hard' And Deserve To Keep Their Money

[haele]

163. Income is different than savings that isn't being touched.

If they were making $500K a year income - revenue after costs if they were a small business owner, of course, that means that they can probably sock away money they don't spend to the tune of $100K. $500K in the bank is not "wealthy" - my Mom has $600K invested and the house is paid off, which gives her a net "worth" of near a million dollars if she were to liquidate. But at 72 years old, if she were to cash it in to live large on that money plus her pensions and social security - even if she planned on pegging her living to $100K a year - she'd only have at most 10 years before she would have had to drop back down to what might be left of her pension and social security.
So she keeps it in the bank for an emergency, like long term care.

Even a million dollars in a bank will only give you about $40K a year interest income if you invested it wisely. A nice bonus if you're working to keep you going, but most people will just plow through the principle buying what they think they need before the money disappears.

It's the "income" part that determines if you're wealthy or not. That's why the federal government doesn't start looking to add inheritance taxes until an individiual recieves a value well over a million dollars.

Haele