6 ms·

Your quibble is addressed via the word “earning.” Money made via investment or inheritance is unearned.

deleted 4y ago
[deleted]
sandworm101 4y ago
>> Money made via investment or inheritance is unearned. I think a great many startup founders might feel that their stock-related income is "earned", especially those who don't pay themselves much of a salary in early years. And every actor/singer/songwriter earning passive income from past artistic works. So too every homeowner or pensioner taking money without actually clocking in on a factory floor. I don't have the numbers, but it may be that the majority of income in the US comes from "investment" or other passive not-earned means.
- aqme28 4y ago
  > I don't have the numbers, but it may be that the majority of income in the US comes from "investment" or other passive not-earned means. I'm curious to see your numbers, because I can't imagine how this could possibly be the case. I think you may be living in a bubble. I wonder even how many of these top non-income earners get their money from inheritance rather than your examples of startups and artists.
  - sandworm101 4y ago
    Earnings from inheritance have almost certainly dropped as a percentage of total income. Inheritance is generational. The huge number of millionaires and billionaires created in the last thirty years haven't had time to die and leave that money to their kids. A few million inherited 40 years ago, mostly in family real estate, is now worth 100s of millions. But that new money probably hasn't yet passed to the next generation. All those tech entrepreneurs (Musk, Gates etc) are also still alive, their money not yet fully inherited by anyone.
    - aqme28 4y ago
      https://www.oecd-ilibrary.org/sites/0dee8dce-en/index.html?itemId=/content/component/0dee8dce-en#figure-d1e1431 https://www.oecd-ilibrary.org/sites/0dee8dce-en/index.html?i... Looks like about 60% of wealth in the US is inherited, and the proportion has been climbing.
      - zozbot234 4y ago
        Do we have to constantly remind people here that wealth != income? Inheritances are wealth. They might have grown in income terms simply because interest rates are on a secular decline (recent short-term raises notwithstanding) and low interest rates boost the value of assets. Comparing wealth stocks and income flows makes little sense in general.
        bradleyjg 4y ago
        I would say were on a secular decline rather than are. Pre-Covid some yields were nominally negative and approaching real zero. There was very little left for them to fall before hitting the carrying cost of cash.
      - sandworm101 4y ago
        Inherited wealth is different than income. If I inherit a million dollar house, then sit on it for twenty years until it is a 10-million dollar house, I have 10-milion in inherited wealth but only 1m of "income" (IRS taxable income). The next 9 of income will only come if/when I sell the house. So comparisons between inherited wealth and actual income across decades are very very tricky.
- drdec 4y ago
  > I think a great many startup founders might feel that their stock-related income is "earned" Perhaps you know this, but just in case and for others, in the US there is a legal distinction between earned and unearned income in relation to taxes. The post you quoted was using the terms in this sense.

deleted 4y ago

[deleted]

>> Money made via investment or inheritance is unearned. I think a great many startup founders might feel that their stock-related income is "earned", especially those who don't pay themselves much of a salary in early years. And every actor/singer/songwriter earning passive income from past artistic works. So too every homeowner or pensioner taking money without actually clocking in on a factory floor. I don't have the numbers, but it may be that the majority of income in the US comes from "investment" or other passive not-earned means.

aqme28 4y ago
> I don't have the numbers, but it may be that the majority of income in the US comes from "investment" or other passive not-earned means. I'm curious to see your numbers, because I can't imagine how this could possibly be the case. I think you may be living in a bubble. I wonder even how many of these top non-income earners get their money from inheritance rather than your examples of startups and artists.
- sandworm101 4y ago
  Earnings from inheritance have almost certainly dropped as a percentage of total income. Inheritance is generational. The huge number of millionaires and billionaires created in the last thirty years haven't had time to die and leave that money to their kids. A few million inherited 40 years ago, mostly in family real estate, is now worth 100s of millions. But that new money probably hasn't yet passed to the next generation. All those tech entrepreneurs (Musk, Gates etc) are also still alive, their money not yet fully inherited by anyone.
  - aqme28 4y ago
    https://www.oecd-ilibrary.org/sites/0dee8dce-en/index.html?itemId=/content/component/0dee8dce-en#figure-d1e1431 https://www.oecd-ilibrary.org/sites/0dee8dce-en/index.html?i... Looks like about 60% of wealth in the US is inherited, and the proportion has been climbing.
    - zozbot234 4y ago
      Do we have to constantly remind people here that wealth != income? Inheritances are wealth. They might have grown in income terms simply because interest rates are on a secular decline (recent short-term raises notwithstanding) and low interest rates boost the value of assets. Comparing wealth stocks and income flows makes little sense in general.
      - bradleyjg 4y ago
        I would say were on a secular decline rather than are. Pre-Covid some yields were nominally negative and approaching real zero. There was very little left for them to fall before hitting the carrying cost of cash.
    - sandworm101 4y ago
      Inherited wealth is different than income. If I inherit a million dollar house, then sit on it for twenty years until it is a 10-million dollar house, I have 10-milion in inherited wealth but only 1m of "income" (IRS taxable income). The next 9 of income will only come if/when I sell the house. So comparisons between inherited wealth and actual income across decades are very very tricky.
drdec 4y ago
> I think a great many startup founders might feel that their stock-related income is "earned" Perhaps you know this, but just in case and for others, in the US there is a legal distinction between earned and unearned income in relation to taxes. The post you quoted was using the terms in this sense.