Future Value under FairTax and current

Because I'm a nerdy kind of person and just love doing spreadsheets etc I worked out a spreadsheet to compare investments under the 2 systems - here are the results based on investing $50/month for 20 years at 5% - you would have approx an extra $7,500 to pay for your child's education - with no restrictions on use etc. I live in Florida and we have Florida Bright Future scholarships which pay full tuition and fees - but if you started out putting your money in one of the education IRA's and your child got the scholarship you would have to pay taxes on the whole thing because you can only use them for tuition and fees and that is being paid for. So much less complex to save your own money the way you CHOOSE to. Here's a copy of the spreadsheet:
Comparison of Future Value of Investments Under Current System & FairTax
Investment Amount per Month $50.00
Invertment Period in Years 20
Rate of Return 5%
Top Income Tax Rate 15%
Future Value Under Fair Tax $20,551.68
Future Value Under Current System $12,942.38

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Spreadsheets?
Submitted by Sailon on Sun, 07/23/2006 - 3:01pm.

Boy, if only life were like spreadsheets. Anytime there is such a disparity as you show in investments, sixty people will find a way to get it from you!

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More like 635 people have already figured it out
Submitted by LindaLiberty on Sun, 07/23/2006 - 3:40pm.

Yes, currently the Senate (100 members) and House (535 members) have figured out how to get that money from you - the INCOME TAX SYSTEM!!!!!! They take your money immediately as you make it and take their cut before you can even decide what you want to do with it. That's why I like the FairTax - you get to invest your before tax money and let it compound and pay taxes when you use it unlike the current system where you have to use after tax dollars and then pay taxes on the return on investment so less compounds. That's why it is so much better with the FairTax - because you can reinvest more - the part the government doesn't take as their cut in your investments. I know you don't want to read a FairTax book but I have a great one you might like. It taught me a lot about Economics - it's called Basic Economics by Thomas Sowell and you can get it at the library. Doesn't have one single chart in it. It got me started learning about economics and how money works etc.

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Familiar with Mr. Sowell
Submitted by Sailon on Sun, 07/23/2006 - 7:12pm.

Miss Liberty: An old story about economists says that if you lined up one hundred economists and shot niney-nine of them you would still be up to your nose in BS by the next day. Too many variables in economics to use for much of anything. Just have a lot of resources and a big army to protect them---all the economics one needs to know.

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Shoot or shot Git
Submitted by Sailon on Mon, 07/24/2006 - 6:21am.

Depends on past or present.

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You guys are a stitch
Submitted by Flydecajon on Mon, 07/24/2006 - 7:04am.

This blog has been one of the best ones yet.

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Gotcha Buddy
Git Real's picture
Submitted by Git Real on Sun, 07/23/2006 - 8:38pm.

It's shoot ninety-nine of them. Not shot niney-nine of them. Smiling

Now don't go pretending like you meant to do that. Your really not much more edumacated than I am ain't cha?


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