By: Dr. Donald E. Wetmore
Pop quiz. As a percentage of total available time, how much time does the average person spend making a living? 20%? 30%? 40%? 50%?
Using $40,000 income as an average, what percentage of one’s average income is paid in taxes each year? 20%? 30%? 40%? 50%?
The answer is 50%/50%. The average person spends 50% of their available time making a living and then pays 50% of that amount in taxes.
“No way!” you say. Yes, way.
First, the time issue. We all have 24 hours in the day and 7 days in a week. That gives us 168 hours in our week. Subtract from that 56 hours for sleep (8 hours a night for 7 days, which might be high for some and low for others) and you are left with 112 available hours to achieve the results on your life.
The average person in the United States works approximately 44 hours per week, some more, some less. Add to that a couple of hours per day for preparation time, getting ready for work, getting dressed and commuting to work, the average person is putting in about 54 hours a week making a living, or about 50% of their available hours.
Ok, but at least I get to keep most of the money I make, right? No. Half of that goes to taxes. No way. Yes, way.
Let’s go through the numbers.
The first deduction is for federal income taxes. The percentage varies with your status but on average, about 20% of your gross salary is taken out off the top for the federal government.
Next, most pay into Social Security. That’s approximately 7% of your gross and your employer matches that amount, for a total of 14%.
Then, for many, there is state tax. The amount varies, but let’s throw in another 4%. Now we’re up to 38%.
That’s a far cry from 50%. But wait, we’re not done.
You then buy a car, you pay a sales tax and a registration fee. You pay a property tax to own it each year. You pay tolls and gasoline taxes to drive it. You pay property taxes on the house you own to garage it.
And if you go to dinner, you may pay a meal tax and a “sin” tax on what you drink and smoke.
Then, if you sell the house and garage that protects the car and make money on the deal, you may have to pay taxes on the profits. And if you have accumulated enough profit throughout the years, you may wind up paying a death tax.
Fifty-fifty.
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Dr. Donald E. Wetmore
Certified Executive Coach, Consultant and Trainer
Author, “Organizing Your Life” and “The Productivity Handbook”
Productivity Institute
Personal Productivity Solutions to Leverage Your Impact
127 Jefferson St.
Stratford, CT 06615
(203) 386-8062
(800) 969-3773
info@balancetime.com
https://www.balancetime.com
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