It's the biggest form of robbery that we've seen in the Western world of the last 20 to 30 years. It's taxation by stealth. If you're a higher rate taxpayer, that meant something. And if you were earning 100 grand a year, you were minted. What we would call working class jobs are now higher rate taxpayers and people are struggling. Because that 100K a year should have risen with inflation and it should be 160K a year before you hit that tax bracket. Damien Jordan is a YouTuber and podcaster helping the world understand personal finance.

James and Damien discuss why tax quietly kills wealth. If crypto is a Ponzi scheme and...

The problem with investing. If you've got kids, I think it's two kids, you lose the credits and

the child care allowance, which means your marginal tax rate shoots up to thousands of percent.

So actually someone with a couple of kids with a hundred grand income is better staying at that point than getting a pay rise, which is mental.

I can't understand that.

Yeah, no one can.

The problem is that when these changes get brought in, they affect a very small amount of people.

And then over time, more and more people get dragged into them because of the fiscal drag. And then the tax revenue becomes so significant that the politicians just can't get rid of it. One example that I could give to you recently in the UK is this mansion tax. So, as you'll notice, I don't promote any other people's crap in this podcast, only in way and stuff.

But if you're out there running a small business and you want to use social media to make money online, it's what I've spent the last 10 years doing. I now teach other people how to do it. If you head to my website, jamesmith.business, you can see what I've got an offer for you. Even this very podcast is a means of me marketing my businesses. this is what probably helped the most expertise in.

So one more time, that's jamesmith.com business.

Head to the website, see how I can help.

Back to the episode. So when we talk about investing, people can say that the markets or different places you invest, you could get seven, eight, nine percent back. And that sounds great. But then I factor into that, okay, what amount of that is inflation? And then even if you were to say it was a third or a half, I then think, well, I've still got to pay a tax on that. So those people saying, oh, put it in an ETF or an index fund, you're going to get 9% back a year. Those numbers aren't quite accurate, or is that a misinterpretation? No, I think you spot on. So I think the people who sit there and say the stock markets average 10% a year for 100 years

are telling kind of like a half truth and it can be a bit misleading.

If you bang that number into a compound interest calculator,

which will try and help you estimate what the value might be in the future,

it's going to look very flattering.

So the gold standard of

research on this is Dimpson, Marsh and Staunton. They produce an annual book almost,

it's hundreds of pages on stock market returns across the globe. And TLDR is, it's around 5%

after you strip out inflation for the last 100 years, but that doesn't,

we've had a pretty good 100 years.

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