Greg
[1] The Millionaire Next Door : The Surprising Secrets of America's Wealthy
http://www.amazon.com/exec/obidos/ASIN/0671015206/o/qid=933781624/sr=2-2/002-4068635-9546037
Dave Long wrote:
>
> > $650k is nothing in California if you add up the average house and
> > retirement fund. $1M even pushes the barrier.
>
> Remember, that's per spouse. So it's effectively (if all the
> financial advertising has actually educated me any) $1.3M now, going
> up to $2M early next century.
>
> Do you have data for average house and retirement fund in CA? Best
> I could come up with this evening was a June 1999 census report at
> <http://www.census.gov/const/c25_curr.txt>, which gives a median
> price of $157K for a single-family house, showing that one can't
> extrapolate from OC or the Bay Area very well to the rest of the
> country. No data on retirement funds; the wealth data from 1993
> suggests that under 4% of households had a net worth in excess of
> half a million. Pointers to more recent and more specific data
> appreciated.
>
> OK, here's a figure for CA. According to the news from April at
> <http://realtimes.com/rtnews/rtcpages/19990428_cahomesales.htm>,
> median SFR is $213K. Even after doubling that for non-primary
> residence assets, you're a far cry from $1.3M.
>
> >From "Family Finances in the US: Recent Evidence from the Survey of
> Consumer Finances", Federal Reserve Bulletin, vol 83 (Jan 97)
> pp. 1-24: <http://www.bog.frb.fed.us/pubs/bulletin/1997/0197lead.pdf>
>
> Median Family Net Worth: 1995 ($, thousands)
> ---------------------------------------
> all families . . . . . . 56.4
> income >$100,000 . . . .485.9
> age of head 65+. . . . ~100
>
> Median Value of Retirement Accounts: 1995 ($, thousands) (% holding)
> ---------------------------------------------------------------
> all families . . . . . . 15.6 . . . . . 43.0
> income >$100,000 . . . . 85.0 . . . . . 84.6
> age of head 65+. . . . . 30-
>
> Median Value of Primary Residence: 1995 ($, thousands) (% owning)
> --------------------------------------------------------------
> all families . . . . . . 86.8 . . . . . 63.9
> income >$100,000 . . . 217.0 . . . . . 90.5
> age of head 65+. . . . .~70 . . . . .~78
>
> > making every generation start from a fixed amount? Heck, the 16th
> > amendment was a mistake that should be repealed. [1]
>
> Can we please be clearer what we're discussing? There's already been
> plenty of confusion of payroll taxes with income taxes, and now
> you're dragging income taxation into the estate tax arena.
>
> (Note that if you're in the position of being worried about estate
> taxes, income taxes work to your benefit, as they shift any given
> tax burden away from large concentrations of property, and towards a
> motley collection of wage earners.)
>
> In terms of providing opportunities for children: in my area of CA
> (where one is unlikely to find condo conversions for under $200K),
> $18K/yr after taxes could reasonably support the life of a surf bum;
> maybe even a well-heeled surf bum. A capitalization of $300-450K
> ought to suffice to throw that off, and I dare say that money could
> go much further in Baja. How much does tuition run these days?
> Surely $240K should suffice to get more (than enough?) education than
> the average rabbit?
>
> Then again, all it takes is a good round of inflation to wipe out
> savings. At least with taxation, you're not only told the rules
> beforehand but also stand a chance of benefit.
>
> -Dave
>
> I might argue that, in terms of utility to your offspring, the
> legacies of genes, education, and a civil society go much further
> to their benefit than that of property.