Quote:
Originally Posted by MikeWaters
Why do the rich keep getting richer, and the middle class is stagnant? Because of market forces, or because of a system set up by the govt. that rewards the already rich?
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Simple. Compound interest. Assume a 3% across-the-board cost of living increase regardless of salary level.
2001: A makes $25K, B makes $250K; a difference of $225K
2020: A makes $45,150, B makes $451,500; a difference of $406,350
Furthermore, the rich have a better understanding of money management and more disposable income to invest in more aggressive portfolios that yield a higher rate of return.