The TRUTH Behind Why Rich People Don't Want A Big Salary
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Top Comments (10)
Rich people own businesses and the businesses own the assets, they don’t.
I am currently working for a company that offers a employee stock program. My coworkers laugh at me when I say. " I work for stocks dude." This video kinda reinforced that mind set.
A suggestion for a future episode. Teaching us Blue collar simpletons how to read financials for stocks such as PE ratio (27x valuation).
BEEN WAITING ON A VIDEO LIKE THIS
I have middle class friends that stay below the next tax bracket to save dollars
Profits are taxed less than salaries.
An important nuance: when the company pays your salary, it's exempt from the corporate taxes because it's a part of its expenses. But if you take money from the profits (assuming dividends), it's distributed on the after-tax basis. And then you pay your own taxes on the dividends. It's commonly referred to as double taxation. So overall, the tax savings are not that great, maybe even non-existent. The impact on valuation may be real. But generally, the very rich use other mechanisms to get paid. Like borrowing money using their stock as collateral. In this case, they get the cash for their expenses but pay no taxes at all because loans are not taxable.
This reminds me of when it came out that Zuckerberg was pledging all of his salary to charity…
W-2 income is taxed mercilessly. You don’t want to be paid like an employee.
Join Market Briefs for FREE and get my daily financial newsletter: https://briefs.finance/3e9105 WARNING: LOOKOUT FOR SCAMS IN THE COMMENTS! There are many fake accounts impersonating me, and there are many bots promoting fake/scam investments. I will NEVER ask you to contact me through YouTube comments, telegram, or WhatsApp. I have a checkmark next to my name and my comment will be highlighted. Fake accounts do not have that. Please be aware of fake accounts trying to scam you using my name and picture!
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Top Comments (10)
Rich people own businesses and the businesses own the assets, they don’t.
I am currently working for a company that offers a employee stock program. My coworkers laugh at me when I say. " I work for stocks dude." This video kinda reinforced that mind set.
A suggestion for a future episode. Teaching us Blue collar simpletons how to read financials for stocks such as PE ratio (27x valuation).
BEEN WAITING ON A VIDEO LIKE THIS
I have middle class friends that stay below the next tax bracket to save dollars
Profits are taxed less than salaries.
An important nuance: when the company pays your salary, it's exempt from the corporate taxes because it's a part of its expenses. But if you take money from the profits (assuming dividends), it's distributed on the after-tax basis. And then you pay your own taxes on the dividends. It's commonly referred to as double taxation. So overall, the tax savings are not that great, maybe even non-existent. The impact on valuation may be real. But generally, the very rich use other mechanisms to get paid. Like borrowing money using their stock as collateral. In this case, they get the cash for their expenses but pay no taxes at all because loans are not taxable.
This reminds me of when it came out that Zuckerberg was pledging all of his salary to charity…
W-2 income is taxed mercilessly. You don’t want to be paid like an employee.
Join Market Briefs for FREE and get my daily financial newsletter: https://briefs.finance/3e9105 WARNING: LOOKOUT FOR SCAMS IN THE COMMENTS! There are many fake accounts impersonating me, and there are many bots promoting fake/scam investments. I will NEVER ask you to contact me through YouTube comments, telegram, or WhatsApp. I have a checkmark next to my name and my comment will be highlighted. Fake accounts do not have that. Please be aware of fake accounts trying to scam you using my name and picture!