One of my sons has been obsessed with owning his own car since he was 14. I have this thing about buying kids cars probably because when I was younger, I had to work to get my first car and pay for everything. So my deal with all my kids is that 1) they can't get a car loan and 2) I'll match them $1 for $1 of what they save toward the car of their choosing.
My 3rd son has really been serious about this. He wants a nice car... he went to work at a fast food restaurant at age 14 and has worked his way up and is now 16. He works every chance he gets and usually works 30-40 hours/week during the school year. He's also maintained a very good GPA in school and is in my office working on homework after work until midnight on many nights. He also fixes computers on the weekends for people.
So yesterday is tax day... and I told him he needed to fill out taxes due to the money he made. He had been claiming "Exempt" on his W4 so he had paid no federal income tax... and guess what? He now has to write a nice size check to uncle sam out of his bank account. Unfortanately, he had the process of saving half of his check and spending the other half on items he wanted (like the newest iPhone, etc.). I've never had to pay for any of this stuff for him since he's been 14.... and now the government wants part of his savings account.
I thought the kid was going to cry. He said it wasn't worth working as other friends of his are getting new cars and they don't even work. Between parents that give their bratty little kids everything they want and the government pitching in the rest via wealth redistribution, it's doubly hard to explain how this is fair other than "It's not fair that you have a job and work hard and other kids don't have jobs. Do you expect them to not have a new iPhone and new car just because you work and they don't?"
We discussed taxes... It's amazing how 45% of the country doesn't pay income taxes but a 16-year old kid trying to save for a car (and not borrow money) pays taxes on anything over $5700. The system really is geared towards "Don't work much and get a car loan" instead of "Work hard, save money and pay cash." He wants a flat tax on what you buy and not what you make. I told him to run for president after college.
The good news is that he now has a clear understanding why I scream at the TV sometimes.
My 3rd son has really been serious about this. He wants a nice car... he went to work at a fast food restaurant at age 14 and has worked his way up and is now 16. He works every chance he gets and usually works 30-40 hours/week during the school year. He's also maintained a very good GPA in school and is in my office working on homework after work until midnight on many nights. He also fixes computers on the weekends for people.
So yesterday is tax day... and I told him he needed to fill out taxes due to the money he made. He had been claiming "Exempt" on his W4 so he had paid no federal income tax... and guess what? He now has to write a nice size check to uncle sam out of his bank account. Unfortanately, he had the process of saving half of his check and spending the other half on items he wanted (like the newest iPhone, etc.). I've never had to pay for any of this stuff for him since he's been 14.... and now the government wants part of his savings account.
I thought the kid was going to cry. He said it wasn't worth working as other friends of his are getting new cars and they don't even work. Between parents that give their bratty little kids everything they want and the government pitching in the rest via wealth redistribution, it's doubly hard to explain how this is fair other than "It's not fair that you have a job and work hard and other kids don't have jobs. Do you expect them to not have a new iPhone and new car just because you work and they don't?"
We discussed taxes... It's amazing how 45% of the country doesn't pay income taxes but a 16-year old kid trying to save for a car (and not borrow money) pays taxes on anything over $5700. The system really is geared towards "Don't work much and get a car loan" instead of "Work hard, save money and pay cash." He wants a flat tax on what you buy and not what you make. I told him to run for president after college.
The good news is that he now has a clear understanding why I scream at the TV sometimes.
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