Latest news with #middleClass
Yahoo
05-07-2025
- Business
- Yahoo
I Asked ChatGPT What Would Happen If Billionaires Paid Taxes at the Same Rate as the Middle Class
Taxes can get you thinking about fairness. For instance, when I'm calculating deductions on my salary and watching a decent chunk go to Uncle Sam, I can't help but wonder: What if the ultra-wealthy paid the same percentage of their income in taxes that regular people do? Find Out: Read Next: So I decided to ask ChatGPT a simple question: 'What would happen if billionaires paid taxes at the same rate as the middle class?' The AI's response was more nuanced than I expected — and revealed some surprising truths about how our tax system really works. First, ChatGPT corrected a common misconception I had. Based on actual data from PolitiFact and ProPublica investigations, the 25 wealthiest Americans currently pay an average federal income tax rate of 16% under existing law. Meanwhile, households earning $50,000-$100,000 (where most teachers, firefighters and other middle-class workers fall) typically pay an effective tax rate between 0% and 15%. So contrary to what I'd heard, billionaires don't actually pay less than teachers under current tax law. But here's where it gets interesting. Learn More: ChatGPT explained that the issue isn't necessarily the tax rates themselves, but how different types of income get taxed. This is where the system becomes genuinely unfair. 'Billionaires benefit from tax strategies that lower their effective tax burden compared to what ordinary income earners face on wages,' the AI explained. 'The current system taxes work more than wealth.' Here's what that means in practice: When I get my salary, taxes come out immediately. When a billionaire's stock portfolio increases in value by millions, they don't pay taxes on that growth until (or unless) they sell those stocks. ChatGPT broke down something called the 'buy-borrow-die' strategy that wealthy people use to minimize taxes. It sounds like financial wizardry because, honestly, it kind of is. Here's how it works: Billionaires borrow money against their stock holdings (which isn't taxed), live off those loans and then pass their assets to heirs largely tax-free when they die. Meanwhile, regular people like me can't defer taxes on our paychecks or borrow against our retirement accounts without major penalties. The AI used ProPublica data to illustrate this: 'The top 25 billionaires saw their wealth grow by $401 billion from 2014-2018, but paid just $13.6 billion in federal income taxes — an effective rate of 3.4% on wealth growth.' That 3.4% figure is what really stung. While they're paying their legal tax obligations on realized income, their actual wealth is growing at a rate that's taxed far below what middle-class workers pay on their salaries. ChatGPT ran the numbers on what would happen if billionaires paid taxes at the same rate middle-class families do — around 15%-22%. Using the ProPublica data, if those top 25 billionaires had been taxed at a 20% rate on their wealth growth, they would have paid around $80 billion instead of $13.6 billion. 'Extrapolate that across approximately 1,000 billionaires?' the AI asked. 'You're talking hundreds of billions in added revenue annually.' The AI outlined several ways this massive revenue increase could transform government services: Healthcare: We could expand Medicare and Medicaid, potentially moving toward universal coverage. Education: Fund universal pre-K or make community college free for everyone. Infrastructure and climate: Invest seriously in clean energy projects and fix our crumbling roads and bridges. Debt reduction: Actually pay down the national debt instead of adding to it every year. ChatGPT noted that this extra revenue could 'stabilize the economy by boosting the spending power of everyday Americans.' Basically, reducing inequality in a way that helps everyone, not just those at the bottom. The most eye-opening part was learning that the problem isn't necessarily that billionaires are breaking the law or even paying lower rates on their taxable income. The issue is that our entire tax system is designed around taxing work rather than wealth. 'Middle-class families can't defer taxes on wages or borrow against stocks tax-free,' ChatGPT pointed out. This creates a fundamental unfairness where people who work for their money get taxed immediately, while people whose money grows through investments can delay or even avoid those taxes entirely. After diving into ChatGPT's analysis, I realized the conversation about billionaire taxes is more complicated than simple rate comparisons. Under current law, wealthy Americans do pay their required taxes. But the system allows their wealth to grow in ways that are largely untaxed, while regular workers pay taxes on every dollar they earn. The AI concluded that if we could successfully tax billionaires more like middle-class workers, the results would mean hundreds of billions in additional revenue annually and potentially better funding for health, education and climate programs. What's more, it could have the power to reduce inequality and improve public trust in the tax system. Maybe the real question isn't whether billionaires should pay more taxes, but whether our entire approach to taxing work versus wealth makes sense in an economy where most billionaires' fortunes come from asset appreciation rather than traditional income. As ChatGPT put it: 'The U.S. could significantly reshape its fiscal and social landscape' — if we can figure out how to make it work in practice. More From GOBankingRates Mark Cuban Warns of 'Red Rural Recession' -- 4 States That Could Get Hit Hard 9 Downsizing Tips for the Middle Class To Save on Monthly Expenses 10 Genius Things Warren Buffett Says To Do With Your Money This article originally appeared on I Asked ChatGPT What Would Happen If Billionaires Paid Taxes at the Same Rate as the Middle Class
Khaleej Times
03-07-2025
- Business
- Khaleej Times
I've started dreaming bigger ever since I came here: Indian expat in UAE
Indian expatriate Roota Mittal, 31, has been in the UAE for little more than a year, but says it is 'a land of big dreams'. The Dubai resident and founder of she says that money is transformative, with the power to change your life, your lifestyle, your mindset and how you show up for life. If you had to write a letter to money, what would you say? I'll just be grateful. 'Thank you for being freely available to me. And thank you for helping me get paid doing what I love while helping my clients. Thank you for giving me the ability to enjoy life, travel, rejuvenate with spa experiences, and for taking care of my loved ones.' How would you describe your relationship to money? My relationship to money has evolved with time. It went from being stressed about money, to spending extravagantly when I made little money, to now where I enjoy my money and also make sure to invest it so it keeps working for me. How do you think this relationship was formed? I come from a simple middle-class family, so at the start, I felt restricted that money wasn't available freely to people like us. I didn't want to let the middle-class money mindset stop me from living my best life though. So, I worked on my wealth mindset - by reading books, attending conferences, learning from mentors, and trying to be better at business daily. What lessons about money management did you learn from your mother? My mum has the biggest heart, and that's what she has taught me by example. She's taught me to help people to my best ability - whether financially or otherwise. Who do you speak to about money matters and is it something you consider 'taboo'? Growing up in an Indian society, talking about money was and still is taboo. But that's why I've spoken freely for the past nine years about how much I've made with our business and my wealth principle. The intention is not to brag, but so it inspires other women and men to stop making it a taboo topic. Who has taught you the most about financial management? Reading books and blogs of people who inspire me has taught me the most. What has been the most profound experience you've had so far in relation to money, and what has it taught you ? There have been many which I share in my book Wealthy Moves, released in April. The one that comes to the top of mind was when I manifested investing in a cool startup, and how the universe helped me make it happen in a few short months. How do you think living in the UAE has changed your relationship with money? The UAE is a land of big dreams. I've started dreaming bigger since I came here. The best part is that the country is open to expats and provides opportunities like no other place. If you could give your child or your younger self one piece of advice about money what would that be and why? Money is abundant, it's freely available and you deserve you get paid really well. What do you value spending money on? Comfort while travelling. And getting a spa done every couple of weeks. What do you consider splashing out? Once in a while, I like to splurge on a jewellery item that becomes a staple in my daily wardrobe. Do you long-term plan your finances, and if so, how? I plan three-five years in advance. What is your long-term goal pegged to your finances? Owning land and turning it into a farmhouse amid the forest and mountains has been a dream of mine for a long time. A simple life to retreat to once we're done with our big city dreams. How much do you save each month? I prefer to save and invest at least 50 per cent of my earnings every single month. What is your greatest financial decision? Betting on myself. To quit my job and start my own education company. And becoming a startup investor. Listening to financial advice and implementing it blindly without understanding the reason or logic behind it.
Yahoo
16-06-2025
- Automotive
- Yahoo
4 Used Luxury SUVs That Are a Bad Investment for the Middle Class
Used luxury SUVs can seem like a smart way to score premium features for less, but they often come with problems. Between high maintenance, complex systems and expensive parts, these vehicles can quickly turn into money pits. Read More: Find Out: If you're middle class and weighing your options, these are the used luxury SUVs that would be best to avoid. Suggested Price: $44,900 Don't let the classy interior of this small luxury SUV fool you, customers and Consumer Reports both have unfavorable reviews when it comes to driving, acceleration and the transmission of the 2024 Mercedes-Benz GLC. Consumer Reports' road test report on the 2024 Mercedes-Benz GLC Class discusses problems with a mushy brake-pedal feel, a delay of power taking off from a stop, bumpy downshifting, a too-firm ride quality and overly pronounced bumps while driving. One Edmunds customer review of the Mercedes-Benz GLC Class mentions problems with acceleration for the 2024 Turbo gas/electric mild hybrid model, including the vehicle lacking power when starting in first gear, and that sometimes, the transmission felt confused, shaking and bucking, especially before the car was up to operating temperature. Another customer review referred to issues with software messages about the steering wheel, and even after replacing the steering wheel, the customer still received the same messages. When Mercedes had replaced the same customer's 2024 Mercedes-Benz GLC with another, they still had the same problem with the steering wheel. Discover Next: Suggested Price: $42,995 to $55,998 Hyundai's section of the Genesis brand has a 2024 Genesis GV70 compact luxury SUV, but some trouble spots definitely need to be addressed. Looking at the road test report for the 2024 Genesis GV70 by Consumer Reports shows problems with the engine stop-and-start, the fuel-saving feature having a shudder when re-engaging, bigger than normal rear blind spots due to the slope of the roofline and thicker pillars on the sides of rear windows, and when accelerating from a rolling stop there is some turbo lag. Edmunds' customer reviews included one customer stating a need for new brake calipers at 3,000 miles, and a leak in the transfer case at 10,000 miles. Yet another customer touched on a possible wiring issue when dealing with all the electronic features malfunctioning, no signal for the navigation system, and not being able to see the speed or the turn signal when driving. Suggested Price: $37,827 to $45,984 The 2024 Audi Q5 is known as a competent and refined luxury SUV, but the Q5 Premium Plus S model does not sit well with customers or Consumer Reports. The reliability of the Audi Q5 is questioned by Consumer Reports based on the following four recalls: Electrical system fire risk issues due to a possible high-voltage battery Outlets or charging cables overheating, causing a fire risk Deactivated front passenger airbag not deploying during a crash Engine screws loosening causing oil leaks and possible risks for fire Edmunds' customer reviews of the Q5 Premium Plus S model had problems with the adaptive cruise, auto braking and auto start/stop, resulting in the dealer's advice to turn off or disable these safety features and the transmission slipping and also stuttering when in drive. Suggested Price: $40,765 to $47,000 Volvo's 2024 XC60 has an elegant interior design, advanced safety features and optional Pilot Assist for drivers, but performance and driver safety when navigating the phone controls, climate control, and audio are just a few of the problems that could cause drivers to be wary of this luxury SUV. Consumer Reports mentions the following issues with the Volvo XC60: Stiff suspension causes a bumpy feeling when turning corners Stiff downshifting and experiencing bumps when trying to relaunch the car from a rolling stop Start/stop feature turns off frequently, which could be a problem for drivers who try to navigate how to deactivate this feature while driving and navigating through several screens of phone controls Climate control and audio that are not as simple as they could be, leaving the question of the driver's safety when performing the actions of navigating through screens to correct. Edmunds' customer reviews include a critical charge alert of the 12-volt battery that resulted in a visit to the dealership, and then afterwards, having two separate incidents two weeks apart, of an alert for a system update and a total recharge of the battery. Other Edmunds' reviews mention that to use the infotainment system, there are a lot of screens that have to be navigated, and that the parking button was not easy to engage and sometimes failed after the first press. Editor Notes: Suggested prices for 2024 luxury SUVs are listed on and are subject to change. More From GOBankingRates Mark Cuban Warns of 'Red Rural Recession' -- 4 States That Could Get Hit Hard 4 Housing Markets That Have Plummeted in Value Over the Past 5 Years 10 Used Cars That Will Last Longer Than an Average New Vehicle This article originally appeared on 4 Used Luxury SUVs That Are a Bad Investment for the Middle Class
Yahoo
14-06-2025
- Business
- Yahoo
4 Types of People Who Will Lose (and Make) Money Due to Trump's New Tax Initiatives
President Donald Trump's proposed tax initiatives promise lower rates, fewer deductions, and big shifts in how income is taxed. However, the real question for everyday Americans is simple: Will I come out ahead or lose money? Learn More: Find Out: Here are four types of people who will lose and make money due to Trump's new tax initiatives. The proposed plan would cut the top individual tax rate from 37% to 30%, significantly reducing tax liability for households earning over $400,000. 'Wealthy individuals will likely seize the opportunity of idle capital gains, given their new ability to offset this with additional depreciation,' said Hector Castaneda, certified public accountant (CPA) and principal at Castaneda CPA & Associates. 'Additionally, removing the SALT deduction cap would likely nudge the wealthy towards second homes or moving to income-tax states and spending less because philanthropy will become a little less attractive (at least from a financial perspective).' Read More: If passed, Trump's plan would expand the Child Tax Credit from $2,000 to $2,500 per child. While most families with children are expected to benefit, middle-income households are anticipated to gain the most, with average credits approaching $3,000. While the tax credit could help offset the rising cost of living, education and childcare expenses for most middle-class families, low-income families may not receive the full benefit. In addition, if funding for programs such as SNAP, childcare subsidies or Medicaid is cut to offset tax breaks, lower-income parents and children could end up worse off overall. 'Major cuts to SNAP and Medicaid will negatively impact child health outcomes, educational achievement and overall well-being,' said researchers in a report for Georgetown Law School's Center on Poverty and Inequality. Pass-through businesses could see a lower flat tax or expanded deductions, especially if Trump's proposal to cap business takes 15% to 20% passes. Entrepreneurs and gig workers using LLC structures may benefit from an expanded Qualified Business Income (QBI) deduction, streamlined tax reporting and potentially reduced tax rates. These provisions are designed to reward small businesses and self-employment. 'These tax cuts provide much-needed relief to small businesses and individuals, and encouraged billions of dollars in economic activity and investment,' said Javier Palomarez, founder and CEO of the United States Hispanic Business Council (USHBC). 'Extending these cuts would allow businesses to invest and grow at a faster rate.' However, critics at the Center on Budget and Policy Priorities (CBPP), a government watchdog agency, said that the pass-through business deduction disproportionately favors high earners. 'Heavily skewed in favor of high-income people, the deduction effectively cuts the top tax rate on this pass-through income by 20%, to 29.6%, compared to the 37% top rate that applies to wages and salaries,' CBPP researchers said. Seniors on fixed incomes may face unique challenges under Trump's tax proposal. To offset tax cuts, Trump has signaled potential changes that could affect seniors. For example, the budget plan proposes $700 billion in Medicaid cuts and enforced higher cost-sharing for beneficiaries above the poverty line. According to a Congressional Budget Office memo, an estimated 16 million Americans could lose health insurance as a result of policy changes included in Trump's 'Big, Beautiful Bill,' and two policies incorporated in federal baseline projections. 'The main culprit in the bill as it relates to healthcare is the effect on the Affordable Healthcare Act,' said Steven Conners, founder and president of Conners Wealth Management. 'Premiums will most likely increase. For those less fortunate, Medicaid will see less funding, which ultimately puts more pressure on this part of the population.' Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates 7 Things You'll Be Happy You Downsized in Retirement This article originally appeared on 4 Types of People Who Will Lose (and Make) Money Due to Trump's New Tax Initiatives Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Fox News
03-06-2025
- Business
- Fox News
CNN polling expert marvels at collapse of Democratic advantage with middle class in Trump era
CNN senior political data reporter Harry Enten Monday marveled at how Democrats continue to face a stark lack of confidence from voters on the economy and middle class issues. Voter dissatisfaction with former President Biden's management of the economy was one of the major issues that led to President Donald Trump's return to the White House. While Trump may have stirred controversy with his tariff and immigration policy shakeups since then, the economy appears to be one key area where he retains voters' trust. CNN host Kate Bolduan observed as she spoke to Enten that, according to CNN's own polling, Republicans are actually gaining ground in terms of being trusted to help America's struggling middle class. "Yeah, you know, historically speaking, 'Which is the party of the middle class?' has been a huge advantage for Democrats," Enten said, referring to one question from the polling. He said Democrats had a 23-point advantage on this question in 1989 and a 17-point advantage in 2016, "But by this decade, we already started seeing declines back in 2022, where you saw that Democrats led, but only by four points, well within the margin of error." Now it's tied. "This, I think, speaks to Democratic ills more than anything else," he argued. "They have traditionally been the party of the middle class. No more! Donald Trump and the Republican Party have taken that mantle away, and now a key advantage for Democrats historically has gone 'adios, amigos,' and now there is no party that is the party of the middle class. Republicans have completely closed the gap, Kate." Enten also said while one might think Trump's rocky experimentation with tariffs might shake voters' faith in Republicans and make them consider the opposition, but, "It ain't so. It ain't so!" The data reporter noted that in November 2023, Republicans had an 11-point advantage as "the party that is closest to your economic views." He noted, "Now it's still within that range, still within that margin of error, plus eight point advantage for the Republican Party. How is that possible, Democrats?" Enten continued to break down the numbers, wondering, "How is it possible after all the recession fears? After the stock market's been doing all of this, after all the tariffs that Americans are against, and Republicans still hold an eight-point lead on the economy? Are you kidding me?" He argued that CNN's poll was echoed by similar findings from Reuters/Ipsos, showing that confidence in Republicans to handle the economy has risen. "And again, this is after months of supposed economic uncertainty in which the stock market's been going bonkers, in which tariff wars that Americans are against have been going on. And yet, despite all of that, the Democrats are down by 12 points on the economy," he said. "This speaks to Democratic problems on the economy better than basically anything that you could possibly look at," Enten continued, arguing that even if approval ratings are slightly lower than they once were, Republicans maintain a clear advantage with public opinion on their management of the economy.
