Wrong!
The concept of saving money is right, but the formula is wrong. Uncle Sam is watching!
Money earned has to be taxed, but money saved does not. If the tax rate is 44% (35% federal + 9% California), I have to earn $1.8 to save $1. [ $1.8 * (100% - 44%) = $1.008]
If I see that the things I buy also have to be taxed, a cup of $7 TPTea will have to be taxed at $7.6. I have to earn $13.7 to afford it. [ $13.7 * (100% - 44%) = $7.67]
So, I quit drinking tea.
My youngest son finally realized that washing dishes for $1 a night would not be enough to support the life he wanted. So he started to become interested in investment and finance.
I'm not saying that I'm a great investor, but I've saved a little money and experience over the past 20 years (from $1,500 when I graduated from graduate school to about $2.8 million today). So I want to start writing about the world I know, using simple language and metaphors to help 10-year-olds understand. Didn't Einstein say that you don't really understand something until you can explain it to a 10-year-old?
I just happen to have a 10-year-old son. Well, I accept the challenge.
Wrong! The concept of saving money is right, but the formula is wrong. Uncle Sam is watching! Money earned has to be taxed, but money saved ...
