xxx

Do the math, folks. If you're a single, working stiff making less than 100K per year, Bush's "tax cut" won't give you enough extra dough to buy a bus ticket to DisneyWorld.
The stock market isn't affecting my plans the least bit -- two thirty-day European trips this year while the dollar is still strong, before the Republicans can destroy it with their traditional weak dollar policies, tax cuts for the rich, bank bailouts for the rich, star wars military boondoggle projects for big rich defense contractors -- well, you get the idea.

Art

Do any of you read the details of the tax cut. The richest that now pay 72% of the taxes will end up paying 75%. The pooest tax bracket will drop from 5% of the total tax revinue to 2.3%. Now if it were truly fair there would be a flat tax of say 10% for everyone with most scam deductions removed. Of course that will never happen no matter whos in office. To much special interest and lobbiest for both parties for that to happen unless the people wake up and start applying pressure.

yes

We just find out that we need to pay a capital gain taxes of more than $14,000 and as a result we will probably take one less trip to Europe or stop paying college tuition for our grandkids. What to do? They can maybe learn how to apply for a student loan

Santa Chiara

Goodness, people, didn't your mothers teach you that it wasn't polite to talk about how much money you have, which is what this thread is all about.

Judy

Santa Chiara: No. I do not think this is just about how much money one has, but how external factors can affect our lives. We have a 401k, that was tied to the Dow Jones, the Dow plummets, and SOME of our retirement money is gone(at least on paper, but it is ALL on paper today). MY husband and I have worked very hard over many years, to save and plan for retirement, as of today, there are less assests available for our future use. Money earmarked for travels will be used to pay other more essential things, ergo the ripple effect.
Let's not touch the "class warfare" issue, because this situation will affect everyone.
I guess we will have to hold onto the rollercoaster until the ride stops(I hope!) Judy

DayTrader

Of course, Santa Chiara, she did. But that's what got me into trouble -- not talking about money gave me no indication of what to do with it after I earned it, i.e. how to save, budget & spend well. Information is power. And sharing is not a sin.

Santa Chiara

Did you people honestly think that the stock market was going to go on and on forever? I still hold that "how much money I lost in the stock market yesterday" (or how much, specifically, in capital gains) lets people know how much you had before. And if your long-term retirement funds are tied to your trip in the next two or three months, then you are justified in being concerned. My belief is, and I am sure I will be corrected if wrong, that most are lamenting over the loss of five-star hotels and $500 meals, not over having lost out on actual travel.

nancy

Last April when we began to plan this trip I put our travel money is in a 1 yr.CD, so this will not affect our plan for this year.
Santa Chiara,
I , too, am amazed at the fact that people discuss things like income here.
there was a post this December, about how much people earned, and recently a post on type of cars people drive.
I was taught one did not discuss the cost of things, or talk about how much money one made.
It really isn't anyone's busy, but if others choose to mention $$ amounts, so be it.
My mother would rather talk about SEX than money, and when I was growing up, I do not think I ever heard her mention sex at all to my sister and myself , that is how distasteful she viewed the subject.
And DayTrader, even with the lack of money discussions, my father still taught us how to deal with money in an appropriate , and sound manner.
Not discussing how much one earns, and how much things cost does not necessarily lead to a lack of education on how to be responsible with money
I also understand that you did not ask about $$ directly, so this really isn't directed to you.
Your question is an interesting one.

Cindy

Patrick, I feel your pain. I got burned by "phantom" capital gains a few years ago, and I have refused to buy mutual funds since. My current approach is to buy individual stocks, not funds. With a buy and hold approach, you won't pay capital gains on individual stocks until you actually sell something.

But as for the original question, yes, we've drastically reduced our travel. Only one pitiful week at the beach for us this year. We feel very nervous about the economy generally, so we've tightened our belts on most everything. Ahem.

Gina

No, the market's drop isn't going to affect my travel. I'm a single professional and the money I have in the market is in very long-term investments: retirement funds, 403(b)s, the SEP IRA I started when I went out as a solo freelancer last year, etc. Since I still have nearly 30 years to retirement, I expect those funds will fluctuate a lot more before they're done, so I try to pay only enough attention when I receive my quarterly statements to decide whether or not I need to change the allocations.

Any money that I'm investing for the short term--that might go to travel, a large purchase, etc.--I put in a high-yield money market fund. It might not bring in the 20% and 30% gains that the stock market was offering just a year ago, but it doesn't lose money either. I'm quite happy with 5% guaranteed returns on short-term investments like that, knowing the money I invested plus a small but significant amount will still be there when I'm ready to spend it.

Still, I know I'm lucky: I don't have kids to support and I own my own home. My freelance work seems to only be increasing in the downsliding economy--as companies lay off staff, they don't necessarily have any less *work* to do, so they're looking for freelancers to pick up the slack without the expense of fulltime salaries and benefits.

I envied people with lots of money in the market and seemingly endless gains in the late 1990s, I must admit. But now I'm glad I don't have to watch the ticker daily with a sick feeling in my stomach. I don't own a BMW, but I'm doing okay, and next month's trip to Paris is not in jeopardy because Cisco announced layoffs yesterday.

Judy

Wow Santa Chiara, did you open a can of worms! When we went to London 3 weeks ago, we stayed at the President hotel(and I think you know what that is like). I have never stayed in a 5* hotel or payed 500$ EVER! We were as poor as church mice when we married, my husband was in the army and I was still in college. I am grandaughter of poor immigrants, by crikey! So please don't do generalizations of very complicated issues. I NEVER mentioned money(specific amounts, the nuns told us never to) I just answered the question!
Judy

Capo

Nope. By sticking with investments that weren't based on hype, I may not have "made" as much money in the past few years, but I also sure the hell haven't "lost" as much money either. Just nice, steady unspectacular gains.

Santa Chiara

Judy, reread my message; I obviously wasn't referring to you--or anyone in particular (in fact, I had to scroll back to see which one you wrote). I didn't make generalizations, either, I made assumptions, probably wrongly.

Anyway, I am not playing anymore. Too many grumpy people on this particular thread.

Mark

Kay,
I will get a lot more than $348.00 / year back from the pending tax reduction. But, using your figure of $348.00 per year for 10 years at my current investment return rate, it would net me prior to capitol gains taxes, approximately $14,500, and thats not fuzzy math!
If you think you should give more to the government and have them invest it for you why don't you send them extra each year. I'm sure they will appriciate it.
Mark

Judy

Pax, S.C. My daughter called last nite and asked if we could still afford to pay for her wedding in April(we can, money is there) I did not mean to come on so strong, I usually don't. You are probably right, too many cranky people, my husband, daughter and some neighbors included. It wears on one after a while.... Still solvent, Judy

BuyandHold

OK, I have to put in a good word for mutual funds, since I work in the industry.

Research is a strong word. If you do enough of it before investing, you should be OK. If you don't like capital gains, look for a fund that has low turnover and a long-term investment objective. Prospectus reading may not be the most exciting, but it will definitely clue you in on the manager's style.

It scares me that someone would recommend dumping mutual funds and buying only stocks. The first word I learned when I moved into this industry was diversification. Would I rather have had all my $$ in one or two tech stocks yesterday or a mutual fund with 200 different stocks? Easy answer!

Be careful how you make your decisions. Do your homework and ask questions whenever you aren't sure.

Ok, stock investors, have at me....

PS - I leave for London soon and will continue to travel on the $$ I saved when times were good! I also pay tuition and will do so as long as possible. Why not start the kids out without massive debt if you can?

joren

My tickets are already bought for Budapest & Rome - I'm locked in. The only reason I won't travel is if I'm laid off - and even then - who knows. The stock market is gambling - so many people want to make a lot of money quickley, without any effort or discipline. How may pairs of kahkis do you need? As for Bush's tax cut - it a gesture at the most. What American doesn't enjoy hearing him say "it's the American citizen's money, not the government " Taxes = bad. When i hear examples like John Doe will get $1600 tax cut - that workd out to a little more than $4 a day. How much does a pair of jeans cost? How much was your electric / gas bill? How much is your rent? If the President wants to help the American citizen - reduce the costs of living. Interest rates, the Dow & Nasdaq go up and down - rents never go down (unless there's a depression) Landlords are nothing more than ticks living off the hard work of other people.

allen

It will not affect our travel plans for this year or next. All our short term requirements are in money market funds or cash equivalents. It has had a significant impact on our long term investments, retirement and college savings, ouch! But since these goals are a decade plus away, we'll sit tight and ride out the storm.

elvira

The downturn in the market has affected me greatly; I'm a baby boomer, 401k plan that's heavily in the market, and retirement not 8 years away. Suddenly, my retirement is looking at 10-15 years away, unless I can recoup the value of my 401k AND growth as though the value had never declined, in the next two years.

I should put my travel money into savings to increase my retirement funds, but I won't...heck, I'll just move in with one of the younger Loons when I retire; they owe me anyway.

What's killing me is stock options i/o cash for quarterly bonuses.

Annie

Anyone who has ever taken an economics course could see the downturn coming. The economy operates in 10-to-12 year cycles, and EVERYTHING for the past year has indicated that we were coming to the end of this current cycle.

I'm enjoying watching the people who were greedily investing in companies that they didn't research losing money now. I didn't get rich during the big boom of the stock market because I invested in stable companies, so I'm also not going to be poor now!

The only people I feel sorry for are those who planned to retire in about 6-7 years. They probably hadn't transferred all of their money yet into stable investments, and they may not have enough time left to watch their investments go back up. Because the market will, in the long-term, go back up.