- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
1
Posted on 3/19/14 at 10:56 am to LSURussian
quote:
Why does it concern you what other people do with their money?
I'm a financial advisor, so I see it all the time with new clients.
Posted on 3/19/14 at 10:58 am to slackster
If I was getting a refund this year, I'd pee myself right now in front of everyone here at the office.
Posted on 3/19/14 at 10:59 am to LSURussian
quote:
I guess I'm financially stupid....
Probably not. I'm willing to bet there is an extenuating circumstance that caused a $9,200 refund in your case. I highly doubt someone like you carelessly overpays the government $9,200.
Posted on 3/19/14 at 11:02 am to slackster
quote:I hope you're not advising people in your professional capacity to purposefully underpay their taxes and then pay the debt off plus interest and penalties over multiple years.
I'm a financial advisor,
If you are, you are advising clients to intentionally violate tax laws. Not cool.
Posted on 3/19/14 at 11:04 am to slackster
my roth for the year is maxed out and i don't do any other investments. I much rather get a surprise $4000 check in april then have an extra $330 in my bank account each month getting a whooping .5% interest in my savings.
plus it comes around the same time as a my work bonus so for a few weeks I get to feel like a true OT baller
plus it comes around the same time as a my work bonus so for a few weeks I get to feel like a true OT baller
Posted on 3/19/14 at 11:05 am to yellowfin
quote:
The entire $5,300 wasn't there for a year and if it were a savings account would have netted you about $50 at today's rates.
Right. The old notion that it's just exceedingly stupid financially, is pretty much exceedingly stupid in today's environment. It's basically as good a savings vehicle as anything.
Posted on 3/19/14 at 11:06 am to VABuckeye
quote:
This statement is false. Part of your money spent more than a year and part of it only was there for a few months. On average your money spent a good bit less than a year there.
In practice, yes, you are right. However, if you withheld $24,000 during the year and have a tax liability of $22,000, then you overpaid $2,000. Technically, that $2,000 could have been paid to you instead of the IRS on any paycheck during the year. If you got paid on the 1st and the 15th, then you could have had NO federal tax withholdings on your January 1st and 15th checks if you desired, and things would have worked out perfectly for you.
Posted on 3/19/14 at 11:07 am to LSU0358
quote:
I make sure I owe them every year. Any penalty is far less than a minimal return I make on the money.
On one side is the minimal amount of interest I might earn from successfully getting my refund down from $2,000 to $200. On the other side is the time it would take me to figure out what the right figure is (which essentially requires me to do my tax return a year ahead of time), the inconvenience of fiddling with witholding rates (possibly two or three times a year if circumstances change, as they always do), plus the potential risk of dealing with interest, penalties, and the GIANT pain in the arse of dealing with the IRS.
Also, if you are a financial advisor and this is the biggest concern you have with your clients' financial acuity, they're in a pretty good spot.
Posted on 3/19/14 at 11:19 am to yellowfin
quote:
The entire $5,300 wasn't there for a year and if it were a savings account would have netted you about $50 at today's rates.
Yes, you are right. If you are going to put the money in a savings account anyways, your opportunity cost are minimal at the moment. However, that doesn't make the decision any better.
Also, if you would have DCA'd that money into a commission-free ETF such as SCHB, your $5,300 would be worth $6,150 today.
People want to earn interest and make money on everything they've got in a bank, but for some reason they've got no qualms about getting nothing back but their principal on $5,300 of money that was rightfully theirs.
Posted on 3/19/14 at 11:24 am to LSURussian
quote:
I hope you're not advising people in your professional capacity to purposefully underpay their taxes and then pay the debt off plus interest and penalties over multiple years.
If you are, you are advising clients to intentionally violate tax laws. Not cool
I've never advocated that for any of my clients or anyone in this thread. What I do/did is an extreme example, and I try to pay my tax liability to the penny as I go.
The premise of this thread is to try and understand the thought process behind KNOWINGLY overpaying throughout the year. I'm not questioning people with extenuating circumstances, but rather, the married guy who is salaried @ $50,000 per year but still claims single and 0 or 1 so he can still get a refund. That guy blows my mind.
Posted on 3/19/14 at 11:28 am to OnTheBrink
quote:
Sorry to upset you.
Nah, you're not bothering me.
quote:
Like I said, for us, it just works
I appreciate your ability to articulate the thought process you use. I disagree with it, but I respect what works for you and your wife.
quote:
as financially stupid as we might be.
I've been around the MT too long to believe you're financially challenged.
quote:
I have plenty of other investments and I feel like my wife and I are doing just fine
Pics?
Posted on 3/19/14 at 11:32 am to slackster
quote:
Also, if you would have DCA'd that money into a commission-free ETF such as SCHB, your $5,300 would be worth $6,150 today.
and it could also be $3,500 a year later
Posted on 3/19/14 at 11:33 am to Y.A. Tittle
quote:
The old notion that it's just exceedingly stupid financially, is pretty much exceedingly stupid in today's environment
Regardless of the opportunity cost, it is not "exceedingly stupid" to pay no more than neccessary to the IRS throughout the year.
quote:
in today's environment
Today's environment only lessens the blow of overpaying during the year. It does nothing to justify overpaying.
quote:
It's basically as good a savings vehicle as anything.
Except that it didn't earn a single penny of interest, so it isn't really a good savings vehicle at all. Plus, there are plenty of different investments where it could have been rather than a savings account.
Posted on 3/19/14 at 11:36 am to slackster
quote:
Regardless of the opportunity cost, it is not "exceedingly stupid" to pay no more than neccessary to the IRS throughout the year.
Where am I saying it is?
Posted on 3/19/14 at 11:38 am to yellowfin
quote:
and it could also be $3,500 a year later
Touche. I cherry-picked that example, but regardless of what you do with your money, isn't it always better to have it today rather than tomorrow?
FWIW, I have these same type of feeling about people who refuse to take advantage of 0% financing offers.
The financially sound decision should be to pay your tax liability to the penny throughout the year as best as possible, just as the financially sound decision is to take advantage of 0% financing. That fact that people justify going in a different direction doesn't diminish the fact that it is the wrong FINANCIAL decision.
Posted on 3/19/14 at 11:42 am to Y.A. Tittle
quote:
Where am I saying it is?
Well, the way I understand your post is that is used to be considered "exceedingly stupid" to overpay throughtout the year, but today's environment has made that notion exceedingly stupid. In otherwords, if you think it is dumb to overpay your taxes, then you are an idiot now.
Please correct me if I've misunderstood.
quote:
Right. The old notion that it's just exceedingly stupid financially, is pretty much exceedingly stupid in today's environment.
Posted on 3/19/14 at 11:48 am to slackster
I mean you get the refund and apply it towards roth, debt, etc... That's what makes me happy about it.
Posted on 3/19/14 at 11:50 am to slackster
quote:
Well, the way I understand your post is that is used to be considered "exceedingly stupid" to overpay throughtout the year, but today's environment has made that notion exceedingly stupid. In otherwords, if you think it is dumb to overpay your taxes, then you are an idiot now.
Please correct me if I've misunderstood.
Point being, the whole 'Haha look how stupid these silly rubes are being excited about a tax refund' narrative is pretty much a tired and not necessarily even financially reasonable trope. Pointing out there are better "investments" out there than the dollar-for-dollar return one gets from an IRS refund doesn't belie the fact that there are plenty of other reasonable SAVINGS VEHICLES (not necessarily investments) that offer basically the same "return."
Ergo, you don't really look as smart as you think you do being the one finger pointing and saying "Haha look how stupid that guy is."
This post was edited on 3/19/14 at 11:51 am
Posted on 3/19/14 at 11:57 am to slackster
quote:
I appreciate your ability to articulate the thought process you use. I disagree with it, but I respect what works for you and your wife.
I don't disagree with what you are saying, as I pointed out. FWIW, and to the subject of the thread, let it be known that my wife and I are not excited at all about our refund. It is essentially "gone" before we see it. To me, winning a fantasy league or getting some random cash excites me, cause I can spend it as I please.
Little story here, whenever the refund topic comes up "around the water cooler", our office manager always likes to question "Why do you get such a big refund?", every year. Well, that's great, I don't mind telling her why. The problem, this same office manager has been here for 33 years and never contributed a dime to a 401k. We get a pension at 30 years, where she will receive half of her salary until she dies, but she cannot retire. Sad really. And if I was to start a thread questioning a group of people, I would question those who do not contribute to retirement vehicles.
quote:
I've been around the MT too long to believe you're financially challenged.
I am usually one of the question askers around here. Mainly because I am constantly trying to learn more and better our future. For whatever reason though, this (tax refunds) and paying down a mortgage (not a hijack attempt) are topics I just don't budge on. For all that we don't know, the wife and are I doing good for people our age and are on pace to leave our jobs when the time comes.
quote:
Pics?
No.
Seriously, NO.
Page 2 of 3
Popular
Back to top
Follow TigerDroppings for LSU Football News