Tax inherited wealth at 98%

[eek.]

Unless of course, you're a royalist or you believe in an aristocracy.

Inherited wealth destroys the objectivity of money and encourages sloth.

Money will flow naturally to those smart enough to earn it.


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<TABLE class=storycontent cellSpacing=0 cellPadding=0><TBODY><TR><TD colSpan=2>Children of wealth: Rich reflections


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<!-- S IBYL --><TABLE cellSpacing=0 cellPadding=0 width=466 border=0><TBODY><TR><TD vAlign=bottom>By Kevin Mousley
Producer, BBC Radio 4, Children of Wealth
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$40 trillion dollars is set to pass to the next US generation by 2040

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Having too much money will never be a problem for most of us, but for those lucky enough to be born rich, life presents a very different set of financial challenges.
"Wealth gives you gunpowder and when you explode gunpowder, you can go in one direction or the other. Either way, you are going to go very fast," said Will from California.
The real estate heir from the US was one of 55 rich young people gathered in London to reflect on their wealth - how to keep it, spend it or give it away.
It was all courtesy of Citi Private Bank, who laid on a week of seminars and fun for the children of some of their richest clients, the so-called Next Gens.
With the recent financial crisis, banks have become keener than usual to hold on to their cash-rich clients.
Research in the US, however, has found as many as 90% of inheritors switch banks on receipt of their parents' largesse.
Clear vision
But these were not the idle rich. Attendee Will was caught leaving a lecture at 1600 one day to catch up on his family's affairs at the "start of the working day back home". <!-- Inline Embbeded Media --><!-- This is the embedded player component -->
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The Next Gens, aged 19 to 29, came from 18 countries, where their families run businesses including telecommunications, civil engineering, and leisure.
Ahmed, from Lebanon, is currently studying at university in Canada and has a clear vision for the future.
"We have our troubles in the Lebanon, it is my intention to equip myself with all the business know-how I can, so I can return and help our economy. If people like me do not do that, then who will?"
He said he lived in a $600-a-month fourth-floor apartment with no lift and worked part-time for the Subway sandwich chain.
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Banks are getting keener to hold on to their cash-rich clients

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Franchise owners moved him from peeling cheese slices to overseeing the accounts of six branches within days.
Peter Charrington, the boss of Citi Private Bank in the UK and Israel, said the group was worth "tens of billions of dollars."
Like most of those attending, Cameron's key concern was a desire to get across how ordinary he really was "as an individual".
Wealth's pressures
"The corporate world does not attract me. Thankfully, we do not have a family business as such, so it is not an option I will need to consider," said Cameron.
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The issue you face is how we create meaning in our lives. The rich are no different - it is about what does my life mean and how am I going to contribute?

Randall Carlock
Insead business school

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The option he has acted upon is an idiosyncratic choice of a music and theology degree at Princeton university in the US, with a year out in Argentina.
He said he mainly hoped to get "some good conversation" out of the week, but also to "get up to speed" on economics.
As the days progressed, it became clear that the attraction of the week was a simple one - the opportunity to kick back and chat frankly with people like themselves.
"I figured that this would be a great place to come and meet some people, " said Justin from New York, " and that we could really relate to each other." <!-- Inline Embbeded Media --><!-- This is the embedded player component -->
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Ungelie, a British Asian heir to a pharmaceutical business, explains the pressures brought by wealth.
"We were advised to make sure we choose the right friends and because my father was doing exceptionally well, you have to be careful about who you talk to, what you say to them," she said.
Come market meltdown and recession, there are still and always will be, some extremely rich families.
'True satisfaction'
By 2040, $40 trillion dollars will pass from one generation to the next in the US alone - the biggest such wealth transfer in history. <!-- S IIMA --><TABLE cellSpacing=0 cellPadding=0 width=226 align=right border=0><TBODY><TR><TD>

Young, rich and gifted - but with their wealth will come responsibility

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"The new generation is much more liquid in terms of business wealth," explained David Poole, director of business development at Citi Private Bank. "These people are more entrepreneurial in their outlook."
Mohammed, the scion of an Abu Dhabi hotel business, reflected on the meaning of money.
"It is only good the moment you spend it: a nice car, a fancy meal in a fancy restaurant, only then.
"If you want true satisfaction, then you must strive to do 'good'. And you can do that whether you live in tent or a mansion," he noted. According to Randall Carlock, professor of family business at the Insead business school, these people were searching for something more fundamental than how to make the best of their fortune. "No matter where you are in the West, the issue you face is how we create meaning in our lives. The rich are no different. It is about what does my life mean and how am I going to contribute?"
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http://news.bbc.co.uk/1/hi/business/7687171.stm

 

[quot7quot]

fine with me. My pops is flat broke. Will work til he drops dead

 

[DarrylParsons]

Good point about sloth. Even with today's inheritance tax rates, it's highly recommended to organize things so that you die with negative assets. Not that hard to do. Just give everyone their inheritance while you're still alive, or stick it offshore in a joint account with someone younger who you trust.

 

[tkf18ny]

fuck the govt
as much as i hate paris hilton id rather see dumb skanks ends up with it than have the govt steal it and piss it away

 

[punter]

Good point about sloth. Even with today's inheritance tax rates, it's highly recommended to organize things so that you die with negative assets. Not that hard to do. Just give everyone their inheritance while you're still alive, or stick it offshore in a joint account with someone younger who you trust.

Interesting, But I bet it leads to some previously rich people dieing in poverty.

 

[DarrylParsons]

Interesting, But I bet it leads to some previously rich people dieing in poverty.

I suppose if you're super rich and have media people slobbering over every move you make, it might be hard to execute. I knew there was reason I decided not to become super rich lol.

 

[punter]

The super rich can make it on the 2% but the people worth 2 or 3 mil and give it to the kids may be in for a suprise when they live longer than they expected.

 

[5teamparlay]

the average homeowner in Cali or elsewhere, if their home is paid off can easily be a millionare.

 

[punter]

If they can find someone who can qualify to buy it.

I read where 60 to 70% of Californians could not afford their homes if they did not already own them.

 

[DarrylParsons]

The super rich can make it on the 2% but the people worth 2 or 3 mil and give it to the kids may be in for a suprise when they live longer than they expected.

Presumably they have some retirement income and even if they needed to draw down their savings they can do it from an offshore joint account with one of their children. The understanding has to be that the kid can only use the account after the parent dies. Depends on the relationship with the kids of course. Usually you can trust your kid not to steal your money, but I guess that's becoming less and less of a given these days.

Then there are things like reverse mortgages where the insurance company takes on the risk that you'll live too long.

You could also make sure the house(s) is(are) in the kid's name while you're still living in it. There is also joint tenancy which is similar.

A creative person could surely think of more ways.

 

[tiznow]

alot of that wealth is blowing up right now in the form of the stock market

many a trust fund baby looking at their accounts and going uh oh

 

[guitarjosh]

90% of millionaires are first generation.

 

[Willie99]

Tax it at 98% ?

Wow, another great Attorney / CPA Revenue Act

I like it

I'd be able to retire young.

 

[Willie99]

BTW: I hope you do realize this would be very bad for business continuation, right? Not that business and jobs is important to you commies, but I'm just saying, y'know what I mean?

Almost forgot, Life Insurance agents would be dancing in the streets too.