Taxing the rich - what is the cutoff?

[Schneed10]

Originally Posted by onlydarksets

True, but it also doesn't account for student loans, which can exceed $100k easily for law/medical school. That can add an extra $15k-20k/year.

If you have at most one kid in daycare and no student loans, I agree.

If you have young kids requiring daycare and student loans, this budget goes out the window, and the 3% is going to be felt.

Your budget is a useful discussion point, but you haven't proved the $250k cutoff is optimal.

I still agree that it is affordable, though. The point of the article (and one that I agree with and I think you agree with) is that Obama has labeled this income bracket as "wealthy", which is not likely true for most of the demographic. That's fine to increase it 3% now, but it's not a well you can keep going back to.

Major student loans definitely throw a wrench in the works. But few have to rack up the kind of debt that SGG did. Usually, you either get grants or aid, or go to a state school in college to keep the debt lower in undergrad. Law school or med school will undoubtedly be expensive.

As for kids in daycare, I still maintain that there are so few people making $250K who also have 2 or more kids in daycare that it's not even worth discussing. Not too many late 20s/early 30 somethings make that much money, it takes a while to work up to $250K for most folks.

[onlydarksets]

Originally Posted by Schneed10

Major student loans definitely throw a wrench in the works. But few have to rack up the kind of debt that SGG did. Usually, you either get grants or aid, or go to a state school in college to keep the debt lower in undergrad. Law school or med school will undoubtedly be expensive.

As for kids in daycare, I still maintain that there are so few people making $250K who also have 2 or more kids in daycare that it's not even worth discussing. Not too many late 20s/early 30 somethings make that much money, it takes a while to work up to $250K for most folks.

I can't speak for the general population, but in the DC area, with so many attorneys and IT professionals, you would be surprised how many 30 year olds with 2 kids and a household income of around $250k there are. As I mentioned, starting salary for a 25-year old is $160k at the major firms, which is thousands of people in this area.

[Schneed10]

Originally Posted by onlydarksets

I can't speak for the general population, but in the DC area, with so many attorneys and IT professionals, you would be surprised how many 30 year olds with 2 kids and a household income of around $250k there are. As I mentioned, starting salary for a 25-year old is $160k at the major firms, which is thousands of people in this area.

I should run that lawyer salary by my lawyer friends around here in Philly. They start out at $60K. Must not be "major" firms.

[onlydarksets]

Originally Posted by Schneed10

I should run that lawyer salary by my lawyer friends around here in Philly. They start out at $60K. Must not be "major" firms.

Sortable Salary Comparisons

These numbers don't include bonuses, which run $15-60k (or higher) depending on hours billed.

[Schneed10]

Originally Posted by onlydarksets

Sortable Salary Comparisons

These numbers don't include bonuses, which run $15-60k (or higher) depending on hours billed.

OK thanks for that info. I had no idea the average lawyer made so much money.

[onlydarksets]

Originally Posted by Schneed10

OK thanks for that info. I had no idea the average lawyer made so much money.

The dilemma is that, in order to get those jobs, you have to either attend a top 10 school (which in most cases will set you back $140k+), or be at the top of your class in a top 50 school (which can still cost you $140k+).

[Schneed10]

Originally Posted by onlydarksets

The dilemma is that, in order to get those jobs, you have to either attend a top 10 school (which in most cases will set you back $140k+), or be at the top of your class in a top 50 school (which can still cost you $140k+).

OK yeah, now it's starting to make sense.

I found this source for attorney starting salaries in the US, it's definitely not in the 6 figures. I guess to land a job at a "major" firm you need, like you said, top credentials:

PayScale - Lawyer Starting Salaries, Average Salary for a Lawyer

And this chart here seems to indicate why you guys in the DC area would be used to very high lawyer salaries:

PayScale - Attorney / Lawyer Salary, Average Salaries by City

[Sheriff Gonna Getcha]

Originally Posted by Schneed10

OK thanks for that info. I had no idea the average lawyer made so much money.

The average lawyer does not make so much money. The notion that anyone can get a $160K job just by graduating law school is dead wrong, and it is the misconception which draws young 22 year olds into the profession. There are about 180 accredited law schools and the big firms tend to hire about 50% of their attorneys from the top 15 schools and the remainder from the top 40 or so. Rarely does a big firm hire a law student from a second tier law school, let alone a third tier law school.

Most 3rd, 2nd, and 1st tier law school grads become public defenders, prosecutors, government lawyers, public interest lawyers, or small firm lawyers. The average law school grad does not work for a 1,000+ attorney firm paying $160K to newly minted attorneys.

Moreover, many big firms pay a lot, but they expect their first years to pay them in blood and with their first born. There is a reason why roughly 50% of those highly paid lawyers leave their jobs within the first 3 years, notwithstanding the fact that they are faced with a mountain of debt.

EDIT - I just read your other post in which you basically said what I noted above.

[onlydarksets]

Originally Posted by Sheriff Gonna Getcha

Moreover, many big firms pay a lot, but they expect their first years to pay them in blood and with their first born. There is a reason why roughly 50% of those highly paid lawyers leave their jobs within the first 3 years, notwithstanding the fact that they are faced with a mountain of debt.

That's an excellent point that I failed to mention.