Growing wealth

cnocbui · 02-10-2019 6:15pm

AndrewJRenko wrote: »

You don't have to go quite as far left as Marx to find people who see the sense of reasonable inheritance tax. Here's a UK Green MEP

[url]
https://twitter.com/MollyMEP/status/1179268870324047872?s=19[/url]

Where are you planning on emigrating to btw?

New Zealand.

dxhound2005 · 02-10-2019 7:51pm

valoren wrote: »

With a million and with the goal of establishing a rock solid portfolio that will beat inflation quite soundly and get dividends paid out that would be greater each year then these are the companies I would choose.

ExxonMobil, Chevron, Clorox, Colgate-Palmolive
McDonalds, Pepsi, Coca-Cola, Johnson & Johnson, Pfizer, Altria, Visa, AT&T, Hershey, Procter & Gamble, Wal-Mart, Diageo, JP Morgan, Walgreen, Royal Dutch Shell, Abbott Labs, Abbvie, Nestle, Boeing, Berkshire Hathaway, Microsoft, Wells Fargo, United Technologies, McCormick, Kellogg, General Mills, Starbucks, Disney and Nike.

I'd be looking at the average 10 year dividend yield of these 33 companies (except Berkshire as no dividend) and buy a few hundred shares of the company whenever it traded at that level. I'd keep doing that, while reinvesting all dividends, until the overall dividend income gave me sufficient income I could happily live off without the need to work (I.e. the J&J dividends would pay for the annual holiday, the Coke dividends would be paying your car insurance etc etc).

I would never sell and would welcome market corrections as it would actually be the market going on sale and I could pick up quality, durable companies at bargain prices. I would think having a portfolio stuffed with these companies would be a no brainer. It would be keeping it as simple as possible. The power of compounding ensures that investing a million today will ultimately dish out a million in dividends over the course of the next few decades through a combo of annually increasing payouts with reinvesting those same payouts. Your million making money (the dividend) which makes more money (using it to buy more stock) which makes more money (the purchased stock itself throwing off dividends).

Have you any plans for who gets all the money when you are dead?

Bob Harris · 02-10-2019 8:15pm

AndrewJRenko wrote: »

How much will you lose to inflation over the ten years?

Currently running at about 0.7% but better than a current account where the principal will go down. As part of a varied portfolio it's not a bad option.

Uncle Charlie · 02-10-2019 8:22pm

AndrewJRenko wrote: »

You're making this up as you go along, aren't you? There is no 'triple taxation'. It's no different to VAT or motor tax in principle.

With no inheritance tax, the rich get richer and the poor get poorer. It is a modest redistribution measure.

For a typical family, splitting a €500k house among 2 or 3 kids, there is no tax due. If one child is inheriting the family home they have lived in, no tax is due.

For higher value inheritances, modest taxes apply, maybe something like 60k in your example, with lots of options to minimise the impact through tax efficient insurance.

We need more wealth taxes to avoid increasing income taxes.

But I'm still unclear about what exactly you're recommending for the OPs scenario?

Your talking about the poor getting poorer but the likes of Bono or Geldof don't have to pay any inheritance tax. How is that fair ?

My point to the OP is that if he did his business in cash he could limit his tax exposure.

We can all learn a lot from the travellers when it comes to being tax efficient and not having to deal with the revenue.

AndrewJRenko · 02-10-2019 9:57pm

cnocbui wrote: »

New Zealand.

Lovely country, I hope to go back there some day.

The new Prime Minister, described by one local as 'a pretty Communist' had done a great job with increasing the minimum wage, providing more resources for schools and improving social supports for families.

Bob Harris wrote: »

Currently running at about 0.7% but better than a current account where the principal will go down. As part of a varied portfolio it's not a bad option.

Yes, better than a current account, but you're still going to be losing money over time.

Uncle Charlie wrote: »

Your talking about the poor getting poorer but the likes of Bono or Geldof don't have to pay any inheritance tax. How is that fair ?

My point to the OP is that if he did his business in cash he could limit his tax exposure.

We can all learn a lot from the travellers when it comes to being tax efficient and not having to deal with the revenue.

'Fair' doesn't really come into it. We don't all get to choose what tax laws we agree with.

Are you advising the OP to live out of a van and have no utility bills?

nkl12xtw5goz70 · 02-10-2019 10:06pm

Bob Harris wrote: »

An post will give you 1.5%AER or 16% over 10 years guaranteed and tax free.

With inflation projected to increase in the coming years, you're earning nothing in real terms with those kinds of returns.

Bob Harris · 02-10-2019 10:25pm

Santino Chubby Munchies wrote: »

With inflation projected to increase in the coming years, you're earning nothing in real terms with those kinds of returns.

...and losing money in real terms in most current and deposit accounts

Uncle Charlie · 02-10-2019 10:31pm

AndrewJRenko wrote: »

Lovely country, I hope to go back there some day.

The new Prime Minister, described by one local as 'a pretty Communist' had done a great job with increasing the minimum wage, providing more resources for schools and improving social supports for families.

Yes, better than a current account, but you're still going to be losing money over time.

'Fair' doesn't really come into it. We don't all get to choose what tax laws we agree with.

Are you advising the OP to live out of a van and have no utility bills?

Most travellers live in houses and do have utility bills.

Also the likes of Bono and Geldof do get to decide if they want to pay tax or not.

Ginger83 · 02-10-2019 10:35pm

valoren wrote: »

With a million and with the goal of establishing a rock solid portfolio that will beat inflation quite soundly and get dividends paid out that would be greater each year then these are the companies I would choose.

ExxonMobil, Chevron, Clorox, Colgate-Palmolive
McDonalds, Pepsi, Coca-Cola, Johnson & Johnson, Pfizer, Altria, Visa, AT&T, Hershey, Procter & Gamble, Wal-Mart, Diageo, JP Morgan, Walgreen, Royal Dutch Shell, Abbott Labs, Abbvie, Nestle, Boeing, Berkshire Hathaway, Microsoft, Wells Fargo, United Technologies, McCormick, Kellogg, General Mills, Starbucks, Disney and Nike.

I'd be looking at the average 10 year dividend yield of these 33 companies (except Berkshire as no dividend) and buy a few hundred shares of the company whenever it traded at that level. I'd keep doing that, while reinvesting all dividends, until the overall dividend income gave me sufficient income I could happily live off without the need to work (I.e. the J&J dividends would pay for the annual holiday, the Coke dividends would be paying your car insurance etc etc).

I would never sell and would welcome market corrections as it would actually be the market going on sale and I could pick up quality, durable companies at bargain prices. I would think having a portfolio stuffed with these companies would be a no brainer. It would be keeping it as simple as possible. The power of compounding ensures that investing a million today will ultimately dish out a million in dividends over the course of the next few decades through a combo of annually increasing payouts with reinvesting those same payouts. Your million making money (the dividend) which makes more money (using it to buy more stock) which makes more money (the purchased stock itself throwing off dividends).

Can you explain 3rd paragraph more......bit of a novice

the-island-man · 02-10-2019 10:57pm

To answer the op question:

It would depend on whether you were single or married but I'd do a calculation of how many properties I would need to generate income as close to the lower tax rate (20%) cut-off point (between €35,300 and €44,500 at the moment).

If there's any money left over then invest it in some tax free initiative such as prize bonds.

Then as I don't think I would be one to sit on my arse all day I would set up a company\companies to hold income earned from any projects I work on. Not sure what I'd do long term with this money but as long as you're not paying it out to yourself you're not subject to income tax.

worded · 02-10-2019 11:05pm

900,000 on Beer and hookers, the rest I’d waste

valoren · 03-10-2019 7:02am

Ginger83 wrote: »

Can you explain 3rd paragraph more......bit of a novice

Take Exxon as a quick example.

https://www.gurufocus.com/term/yield/NYSE:XOM/Dividend-Yield-/Exxon-Mobil

You'd ideally like the share price to be at a level where when it is divided by the dividend payout that this % is higher than the average "dividend yield %" over a span of years. It's a quick way to determine value/bang for your buck or if a dividend stock is too expensive at any given time.

In the above example the asking price for Exxon is currently $67.15. Its paying out $3.48 a year so the dividend yield is 5.18%

Looking at the gury focus data; "During the past 13 years, the highest Dividend Yield of Exxon Mobil was 5.04%. The lowest was 1.90%. And the median was 2.75%."

So given the above, it is a good deal and with a million dollars to invest, I'd be happy to buy 250 shares of exxon for $16,787 giving me an annual "income" of $960. I'd have $983,213 left to look at the other companies in the list using the same process until I had generated enough dividend to be capable of covering my living expenses. That cash could be used to pay for whatever I wanted it to or I could just buy more Exxon stock with it. That $960 will likely grow next year anyway.

"During the past 13 years, the highest 3-Year average Dividends Per Share Growth Rate of Exxon Mobil was 13.40% per year. The lowestwas 0.00% per year. And the median was 4.30%per year.

With this in mind then I am likely to expect an average annual increase 4.3% depending on what the Exxon management decide. They might decide to payout with no increase at all but it will still payout which is the goal in investing in such companies I.e. they pay reliable dividends.

You look at Coca Cola and you see that the current yield is below the long term average so the price would need to drop a bit more before investing.

https://www.gurufocus.com/term/yield/NYSE:KO/Dividend-Yield-/Coca-Cola

Beasty · 03-10-2019 8:11am

My approach has been to spread risk

My investments comprise

Properties
Shares
Tracker investments
Cash
Precious metals
Football memorabilia
Other memorabilia, including limited edition books, signed prints and the like

All categories have beaten inflation albeit over an extended period

There is also a certain pleasure in holding and showing off things like World Cup Winners medals (soccer - have 4 of them including from the first one in 1930), prints and books signed by the likes of George Best, David Bowie and George Harrison.

AndrewJRenko · 03-10-2019 8:36pm

Uncle Charlie wrote: »

Most travellers live in houses and do have utility bills.

Also the likes of Bono and Geldof do get to decide if they want to pay tax or not.

Really? You seem to have intimate details of tax details of travellers and celebrities. Would you care to share how you have such certainty around these usually confidential details?

Uncle Charlie · 03-10-2019 10:30pm

AndrewJRenko wrote: »

Really? You seem to have intimate details of tax details of travellers and celebrities. Would you care to share how you have such certainty around these usually confidential details?

Its well known that both Bono and Geldof go out of their way to avoid tax.

If I tried to do what Bono or Geldof does you would call it "fraud".

As for travellers I live beside travellers who don't work yet are driving brand new vehicles.

https://www.standard.co.uk/news/how-debt-crusader-geldof-could-save-16m-in-death-tax-6597904.html

https://www.thetimes.co.uk/article/the-boomtown-non-dom-beats-tax-lq3dqmc03hv

https://www.independent.co.uk/arts-entertainment/music/news/bono-paradise-papers-tax-leak-investments-u2-ireland-malta-guernsey-netherlands-haven-a8039716.html

https://www.telegraph.co.uk/news/1525823/U2-move-their-assets-out-of-Ireland.html

Bobeagleburger · 03-10-2019 10:35pm

Big difference between tax avoidance and tax fraud. I'd imagine most people would avail of the former if they could,

Uncle Charlie · 03-10-2019 10:39pm

6 wrote: »

Big difference between tax avoidance and tax fraud. I'd imagine most people would avail of the former if they could,

Its not fraud when you are trying to keep your own money.

AndrewJRenko · 05-10-2019 11:43am

Uncle Charlie wrote: »

Its well known that both Bono and Geldof go out of their way to avoid tax.

If I tried to do what Bono or Geldof does you would call it "fraud".

As for travellers I live beside travellers who don't work yet are driving brand new vehicles.

https://www.standard.co.uk/news/how-debt-crusader-geldof-could-save-16m-in-death-tax-6597904.html

https://www.thetimes.co.uk/article/the-boomtown-non-dom-beats-tax-lq3dqmc03hv

https://www.independent.co.uk/arts-entertainment/music/news/bono-paradise-papers-tax-leak-investments-u2-ireland-malta-guernsey-netherlands-haven-a8039716.html

https://www.telegraph.co.uk/news/1525823/U2-move-their-assets-out-of-Ireland.html

And what tax have Bono and Geldof already paid?

Again, how come you have such intimate details of your neighbours finances?

AndrewJRenko · 05-10-2019 11:44am

Uncle Charlie wrote: »

Its not fraud when you are trying to keep your own money.

There's a couple of decades of tax law that disagrees with you. Does your disdain for funding public services stretch to not using those services - hospitals, schools, roads etc?

Uncle Charlie · 05-10-2019 12:27pm

AndrewJRenko wrote: »

There's a couple of decades of tax law that disagrees with you. Does your disdain for funding public services stretch to not using those services - hospitals, schools, roads etc?

I've already paid more than enough tax I just don't agree with paying extra tax on money that was already earned.

Uncle Charlie · 05-10-2019 12:29pm

AndrewJRenko wrote: »

And what tax have Bono and Geldof already paid?

Percentage wise you and I probably pay more tax than Bono and Geldof.

Again, how come you have such intimate details of your neighbours finances?

The travellers that live beside me are all on the dole yet are driving new cars.

adox · 05-10-2019 12:42pm

Uncle Charlie wrote: »

I've already paid more than enough tax I just don't agree with paying extra tax on money that was already earned.

You can keep saying it as much as you want but the tax would be due and you would be knowingly breaking the law not paying it.

It’s of little consequence what you think of it or what you think you are entitled too.

Uncle Charlie · 05-10-2019 12:54pm

adox wrote: »

You can keep saying it as much as you want but the tax would be due and you would be knowingly breaking the law not paying it.

It’s of little consequence what you think of it or what you think you are entitled too.

If I self identify as a traveller revenue won't be able to come after me.

AndrewJRenko · 05-10-2019 1:03pm

Uncle Charlie wrote: »

Percentage wise you and I probably pay more tax than Bono and Geldof.

Really? What percentage do the lads pay?

Uncle Charlie wrote: »

The travellers that live beside me are all on the dole yet are driving new cars.

Really? Have you reported them to Social Welfare? How do you know that they're actually on the dole?

Uncle Charlie · 05-10-2019 1:13pm

AndrewJRenko wrote: »

Really? What percentage do the lads pay?

In Geldofs case he will pay close zero inheritance tax.

Bono uses every tick in the book to keep his money away from the tax man.

https://www.theguardian.com/music/2018/jan/05/lithuanian-company-linked-to-bono-fined-after-paradise-papers-revelations

Really? Have you reported them to Social Welfare? How do you know that they're actually on the dole?

I would never rat on anyone as my old teacher use to say in school "look after your own house and don't be worrying about what other people are doing".

dxhound2005 · 05-10-2019 1:17pm

Uncle Charlie wrote: »

In Geldofs case he will pay close zero inheritance tax.

Bono uses every tick in the book to keep his money away from the tax man.

https://www.theguardian.com/music/2018/jan/05/lithuanian-company-linked-to-bono-fined-after-paradise-papers-revelations

I would never rat on anyone as my old teacher use to say in school "look after your own house and don't be worrying about what other people are doing".

You took the trouble to find out that they are on the dole. Why?

adox · 05-10-2019 1:17pm

Uncle Charlie wrote: »

I would never rat on anyone as my old teacher use to say in school "look after your own house and don't be worrying about what other people are doing".

And yet here you are using your assumed neighbours position to try and justify you breaking the law.

Maybe you should have listened to your teacher.

Or maybe(and more likely) you just aren’t being genuine.

Uncle Charlie · 05-10-2019 1:27pm

dxhound2005 wrote: »

You took the trouble to find out that they are on the dole. Why?

Its no secret everyone in the area knows they are on the dole.

Uncle Charlie · 05-10-2019 1:30pm

adox wrote: »

And yet here you are using your assumed neighbours position to try and justify you breaking the law.

Maybe you should have listened to your teacher.

Or maybe(and more likely) you just aren’t being genuine.

I have no problem breaking an unjust law.

If a law is unjust, a man is not only right to disobey it, he is obligated to do so. -Thomas Jefferson

AndrewJRenko · 05-10-2019 1:45pm

Uncle Charlie wrote: »

In Geldofs case he will pay close zero inheritance tax.

Bono uses every tick in the book to keep his money away from the tax man.

https://www.theguardian.com/music/2018/jan/05/lithuanian-company-linked-to-bono-fined-after-paradise-papers-revelations

I would never rat on anyone as my old teacher use to say in school "look after your own house and don't be worrying about what other people are doing".

You might have missed my question, which wasn't about inheritance tax. I asked about what percentage of tax Bono and Geldof pay?

It's interesting to note how your 'don't be worrying about what other people are doing' doesn't seem to apply to your obsession with Bono and Geldof.

Growing wealth

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