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Originally Posted by russotto
This isn't so. The more people make, the more they spend -- substantially more. There are lots of high income people living paycheck to paycheck.
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these type of people wouldn't be getting a large portion of their money from capital gains and dividends though, as they don't have the discipline to save and invest. the majority of high income individuals do invest though. maybe not as much as they could, but more than many others are able to do.
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Sorry, that doesn't work, because the capital gains are only realized when the investment is sold.
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the average investor has a very large portion of their portfolio in mutual funds which pay out capital gains annually and dividends more frequently. stocks and bonds do work how you were describing though.