Life Lessons Flashcards
Egypt
cooking oil, foreigners, slaves
Rome
sales, inheritance, imports, exports
Russia
Beehives, beards, souls
England and Missouri
Bachelors
Direct Tax
everyone must pay. personal income, corporate income, capital gains, estate, property
Indirect Taxes
consumption taxes. sales, excise, value added, custom, stamp. entertainment
Direct taxes unconstitutional
Article 1 section 8
Direct Tax legal
1913, 16th amendment
Texas Taxes
Federal Income, sales and excise tax, property tax. 32nd in taxx burden
1 and #50
New York, - 12.75 % and Alaska
Federal Tax Bracket
10% ,< $9950
12% < $9951 - $40525
22% < $40526 - $86375
24% $86376 - $164925
32% $164926 - $209425
35% $209426 - $523600
37% $>$523600
Tax Avoidance strats
Invest in municipal bonds
Invest in long term capital gains
Start a business
Max out retirement accounts
Use a health savings account
Claim all possible tax credits
Credit
Borrowing money for items that you can’t afford to pay for in total
Interest
The cost of borrowing money
Simple Interest
The amount of interest due on the loan
Accrued Interest
Interest that accumulates until its paid off.
Compound
Interest on interest
1800s History of credit
MORTGAGE LENDING WAS RISKY, SO MOST LOANS WERE ISSUED THROUGH INDIVIDUALS. BUILDING AND LOAN COMPANIES STARTED TO LOAN MORTGAGES THROUGH 15-YEAR NOTES.
1900 - 1960
ENRY FORD DIDN’T LIKE DEBT, SO HE WOULD ALLOW PEOPLE TO PUT CARS ON LAYAWAY. THEY COST ABOUT $850 AT THE TIME
($20,000 TODAY). GM LOANED PEOPLE MONEY TO BUY CARS
1950
THE FIRST CREDIT CARD WAS THE DINERS CLUB CARD IN 1950. IT WAS USED FOR TRAVEL AND ENTERTAINMENT. THE BALANCE HAD TO BE PAID EVERY MONTH.
Eventually..
BANKS STARTED TO USE REVOLVING CREDIT, WHICH
MEANS THAT THE WHOLE BALANCE DIDN’T HAVE TO
BE PAID EACH MONTH. THIS ALLOWED THEM TO
COLLECT MORE INTEREST
1958
BANKAMERICARD (VISA) ISSUED CARDS FOR
GENERAL CREDIT IN 1958
Establish credit
YOU NEED TO APPLY FOR THE CARD WITH THE LOWEST AVAILABLE
INTEREST RATE, AND MAKE SMALL PURCHASES THAT YOU CAN AFFORD TO PAY AT THE END OF THE MONTH. YOU WANT TO AVOID PAYING FOR HIGHLY CONSUMABLE GOODS ON CREDIT. ONCE YOU GET THE HANG OF IT, YOU CAN PURCHASE SOMETHING THAT
MIGHT TAKE A FEW MONTHS TO PAY OFF. MONITOR YOUR CREDIT USING A CREDIT MONITORING APP.
What to look out for
Student credit cards with 30% interest, Title loans, The bigger that bank the better, small car lots
How to use credit
FOR EXAMPLE, YOU MIGHT BUY FURNITURE AT 0% FOR 24 MONTHS.
THAT MEANS YOU HAVE 2 YEARS TO PAY OFF THE FULL AMOUNT OF
THE FURNITURE. AS LONG AS YOU DO THAT, YOU NEVER PAY INTEREST
ON IT. IF YOU DON’T, YOU WILL OWE A HUGE AMOUNT OF INTEREST,
SO TREAD LIGHTLY.
