The gradual reduction of an asset’s value. A non-cash expense, which is often a tax write-off. A person or company may reduce their taxable income by the amount of the depreciation on the asset. Because this is an accounting function, it often has little resemblance to the asset’s useful life. The owner of the asset continues to use it tax-free after its value has been depreciated to nothing.
Category: Money & Wealth Page 6 of 14
1. A tax deduction for the gradual consumption of the value of an intangible asset. For example, if a company spends $10 million on a 10-year license, it amortizes the expense by deducting $1,000,000 from its taxable income per year for 10 years. Often used interchangeably with depreciation, which is the same thing for tangible assets. 2. The spreading of loan repayments over a given period of time.
An endless, frustrating, self-defeating, or pointless pursuit that conjures images of lab rats racing through a maze to get the cheese, much like society racing to get ahead financially. Commonly associated with an exhausting, repetitive and overscheduled work that leaves little time or energy for relaxation or enjoyment. Burdened with financial obligations and responsibility to pay mortgages/rent, cars, credit cards, children and a never-ending cycle of consumption, digging deeper into financial holes, stress, worry, fear and lack of choices. Doomed to put up with dead-end jobs, careers, and relationships, living paycheck to paycheck with no end in sight. This lifestyle happens independently of income level, with many high-income earners unable to quit the treadmill. The key to winning this race is: don’t be a rat.
1. To bet on an uncertain outcome, as of a game or sporting event. 2. To play a game for stakes, especially a game whose outcome is at largely determined by chance. 2. To take a risk in the hope of gaining an advantage or a benefit. 3. To engage in a reckless or hazardous behavior. 4. To invest in a project where little or no research has been conducted, the odds of failure are high, the intention is risk-seeking, emotions such as greed and fear are motivators, ownership of something tangible is not involved, the return is expected overnight, entertainment is the primary motivator, no economic value is added.
A shortcut to estimate the number of years required to double your money at a given annual rate of return. Divide the rate, expressed as a percentage, into 72. Years required to double an investment = 72 ÷ compound annual interest rate. For example, if you start with $1,000 and want to know how long it will take to double to $2,000 at an interest rate of 20%, then the calculation is: 72 ÷ 20 = 3.6 years.
A soul-destroying addiction that changes people’s personality and the values they live by. Greed, recognition, attention, love and admiration from working longer and longer hours replace self-satisfaction of a job well done and intrinsic self-worth and esteem. Family member relationships are strained, distorted and often result in broken homes. Eventually, the loss of health, personal and professional integrity follow. Unfettered capitalism, greed, and worshipping success and money feed this addiction.
1. The materialism and overconsumption in affluent communities that is harmful to the environment and society. Includes large-scale consumer debt, product waste, and greed. The relentless pursuit of financial success leaves them unfulfilled and unsatisfied, craving more wealth, while unable to get lasting pleasure from material things. Consumption and acquisition dominate their time and thoughts to the detriment of personal relationships and wellbeing. 2. The guilt, depression or lack of motivation experienced by people who have made or inherited large amounts of money and who no longer need to work. Endless increases in material wealth without a clear and compelling purpose may lead to feelings of worthlessness and dissatisfaction rather than experiences of a better life.
The interest on a loan is added to the principal so that the interest also earns interest. This addition of interest to the principal is called compounding. Over time the compounding effect accelerates. Increasing the interest rate, term, or principal amount maximizes the effect. For example, a $1,000 investment, earning 20% annual interest, over ten years, accumulates a total of $7,385.01.
A fictitious country that is designed from scratch to personify all the excesses of capitalism, greed, workaholism, and consumerism to create a society that is soulless, heartless, and unhappy. The value of citizens is measured by their job title, salary, and sacrifices made in the pursuit of money, wealth, status, success, and recognition. Love is measured by external factors, rather than internally, inequality reaches extreme levels with an attitude towards the less fortunate that they have access to the same opportunities and don’t make anything of themselves, therefore they are undeserving. The media spews bad news, while the future is talked up frantically with pollyanna optimism. Art, aesthetic, nature, philosophy, and spirituality are devalued and discouraged as wastes of time and opportunity. Rich celebrities and capitalists are celebrated while kindness and compassion are marginalized due to a low perceived ROI. Working longer and longer hours are seen as heroic with intense competition for who can sacrifice the most personal life for the career, for success, and for recognition. Vacations are frowned on for people who are not committed. An inability to relax leads to a frenetic pace of life that is classic time poverty, with heart disease and depression masked by fashion, youth, and artificial beauty.