[Aces4]

Originally Posted by OrangeBlossomBaby

I mean, I'm not a CPA or anything but this is pretty simple math. Here's an example of what I'm talking about - your typical millionaire family:

2 parents, 2 minor children. Household is pulling in around $750,000 per year, while living in their "less than $500,000 home." They want to upgrade. They sock away $100,000 per year for the kids college education. They pick last year's BMW model instead of this year's Mercedes for their new car. They vacation at Yellowstone instead of Cabo, or a Disney cruise instead of a Windjammer.

By the time their kids are old enough for college, they have around $600,000 socked away in their college trust fund. One of them can afford Harvard, the other could probably swing it with a Pell grant to augment.

Now that the kids are in their first year of school, they sell their "less than $500,000" house for - let's call it $400,000. They use most of it as a downpayment on their new home, and sock away another $100,000 for moving expenses and new furnishings and replacing the carpet that came with the house for some nice wooden planks.

Meanwhile - they're still earning $750,000 per year between them. They still have their usual expenses, so their net at the end of the year will still be in the positives, which they can continue to save.

They can live VERY comfortably, and still save money for when they actually retire. And - at that point, their pensions, investments, 401K, Social Security, all of that, will be a lovely nest egg to live off of for the rest of their lives.

I didn’t know we were going back to newlyweds, I thought we were discussing current financial retiree situations, not people living outside the bubble. Another big factor you missed though, is the tax burden from wages and real estate. Poor and lower income people don’t make the largest percent of payments.

BTW, Pell Grants are for very low income families and they sure wouldn’t qualify for that.