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Episode 104: A green thumb

The horror of taxes with Mak and G
Episode 104: A green thumb


Today, Mak and G look at the horror of taxes and the risk there is for anyone to go bankrupt.


We talk about how taxes affect your paycheck and why it’s important to know exactly how much money you bring home each month.


In this “Money With Mak and G” podcast episode, Mak and G look at the different types of taxes, what they’re used to fund, and how they affect your paycheck.


We talk about the importance of understanding your net pay and how even millionaires and celebrities can end up bankrupt…


“Happy mothers day. If you didn’t get your flowers it’s actually not even a top 3 mothers day gift. Spending is about 25 billion dollars with jewelry being number 1.” – Mak


“Men spend over 100 dollars more on their mothers than women.” – G

Time Stamps:

00:26 – How the markets have been moving this week.

01:11 – How much money gets spent on mothers day each year.

02:33 – How much it costs to raise a child.

04:11 – How millionaires and celebrities end up bankrupt.

05:28 – The horror of taxes and the importance of knowing your net pay.

07:13 – The different general taxes that get taken out of your paycheck.

08:22 – What state taxes pay for.

09:48 – How Willie Nelson got saved after owing 16.7 million dollars to the IRS.


Connect with Ben Jones:



DAD: Hello and welcome back to Money with Mak and G. This for the weekend in May 14 2021. Don’t forget to like, subscribe and comment on the podcast. Hey, Mak over to you.

MAK: I’m Mak and these are the markets.  The Dow has hit another high, and is trying to hit 35,000.  Blue chips are killing it.  The S&P is right there with the Dow, and both are at their highest point since the year began.  The NASDAQ got beat up over the last couple weeks, falling about 2%. 

GRANT: That means the Dow is pushing 14% up and the NASDAQ is about 7% on the year.  Bitcoin jumped back and is almost 100% up.  We might want to talk about other digital currency sometime in the near future, as there are all kinds of weird things happening.  Dad’s day trading account is continuing to fall, and Apple is in negative territory again for the last two weeks, as compared to our initial purchase.  And, those are the markets.

MAK: Before we get started, today is Mother’s Day and we hope you had a great one. Breakfast in bed was just the start for us. But, we have to do a shoutout to the 2 Billion mothers out there.  

GRANT: Happy Mother’s Day!! If you didn’t get your flowers, it’s actually not even a top 3 item mother’s day gift.  Spending is about $25 billion, with jewelry being number one at over $5 Billion, special event outings is over $4.5 billion and gift cards are over $2.6 billion with flowers a very close number 4. 

MAK: I think mom would’ve loved a spa day, and about $2 Billion is spent on those for Mother’s Day.  Did you know men spend over $100 more on their mother’s than women? Do you think they feel guilty for something? Spending is the least in the Midwest, while the West spends the most on average.

GRANT: It’s hard to believe that over 4 babies are born EVERY second, so there are new mothers all the time. Welcome to the club!!! There was a study of University Freshman in Australia, and 40% listed their mom as the most important and influential person they’d ever known.  That means mom’s totally helped shape their lives, and were very important.

MAK: It’s a HUGE decision. It costs a LOT of money, energy and time.  The US government came up with a number several years ago and if you add the rising costs since the report came out, you’re pushing $300,000 but depending on choices could be much more.  

GRANT: That doesn’t even include costs for college which could be a couple hundred thousand more. There are 15 million moms in the US who are doing it alone.

MAK: Mother’s can teach you a lot.  Hey, the chimpanzee’s mother teaches them lifelong grooming skills.  Grant, maybe you could learn a few things from a chimpanzee.

GRANT: Funny, haha sis. But, you are right about one thing. Mother’s have been shown to be a critical part of teaching their kids about all kinds of things.  So, we hope they continue to teach their kids all kinds of things, and let’s not forget lifelong money skills.

MAK: Way to work that in, G. We love you mom’s and keep up the good work!


DAD: Thanks Mak and G for the Mother’s Day wishes.  If we get back to our discussion after our Money Mentality podcast, we have gotten the proverbial ground fertile to grow something special.  How about your wealth?  You can’t plant a seed in poor soil and expect it to grow. I’ve been lucky to have a green thumb for growing plants AND money. We want to help you and now with the right mindset, we’re ready to jump in.  The next letter in our super simple mnemonic is the “A” which is to ASSESS your situation. This is looking at where you stand, which means looking at your behaviors and figuring out where all the money goes. 

MAK: Even a number of very well known celebrities have gone bankrupt, because they didn’t have enough money coming in to cover the 21 races horses, 17 cars, 2 helicopters and the gold plated front gate, in this case, with the phrase “Hammer Time” on it. Dad says the parents probably know a guy that was the master of parachute pants, that doubled as actual parachutes on the Taco Bell commercial. He was a dance sensation, and his name was MC Hammer. Though he made over $70 million back in the early ‘90s, I guess he didn’t realize that a $30 million mansion with 200 employees isn’t the way to be prudent with your money.  If that wasn’t enough, he had an entourage. Yes, like a king, he had 40 of his closest friends go with him everywhere he did. It cost him over $500,000 per month. I guess when he was done, he was only left with memories, as everything else was taken to pay his bills.  Maybe that’s where he got the name for the song “Can’t touch this”. 

DAD: So, here’s the question.  Can you EASILY tell us what you earn and spend each month by expense group? Let’s start with the money that comes in.  For most people if I asked how much you get paid, you’d say “ABSOLUTELY”.  But, we’re really talking about how much you actually bring home.  Yep, we all know what gets taken out before you get anything.  Do you remember the HORROR. I mean HORROR of your first paycheck. My niece got her first REAL paycheck and asked why there are so many subtractions from your paycheck, and who the heck is this Mr. FICA person?  I know you know what I’m talking about.  Kids can you help out??


DAD: Right on the money!!

GRANT: If your salary is $60,000 that’s called your gross salary.  That’s BEFORE taxes.  After all the taxes come out, you might think your pay is GROSS, since it’s much lower. But, the amount you get AFTER taxes is called your NET pay. We need to think in terms of NET pay.  In basketball, it only counts after it goes through the NET, right?  So, your net pay is the only thing that counts for us. Think… NOTHING BUT NET, BABY!

DAD: It’s like the old joke that many people don’t really know how much money the actually have.  The question is, “How can I be out of money, because I still have checks?”  That’s wrong in so many ways, and requires us to know where all the money is.  So, when assessing your situation it’s all about what truly comes in from your pay and what goes out.  It’s slightly more complicated when we talk about personal taxes.  We’ll assume your NET pay will pretty much match when you settle up your taxes each year. Maybe a teensy-weensy payment or refund.

DAD: Ok, let’s make this tax thing as easy as we can. If you shoot the long ball in basketball, and you sink it with overwhelming confidence, how many points do you get?


DAD: Absolutely.  It almost feels like March Madness around here with all this basketball talk. So to get to your NET pay, you have 3, yes 3 general taxes taken out of your paycheck. Just like sinking a three pointer.  Let’s make it simple.  They are:

MAK: Federal 

GRANT: State 

DAD: FICA (Federal Insurance Contribution Act) which is Social Security and Medicare

DAD: Federal and State depend on your income, and FICA is right at 7.5%.  We don’t need to go into the details, because you can also have local taxes, which we’ll treat just like your state, since it depends on where you live.  That’s three.  FICA is fixed and the others depend on your income. You can think of it as an admission fee.  To be an American, there is a fee, to be a Hoosier, there is a fee, and then you also pay to get into the special attractions, which are Social Security and Medicare, which help you when you get older.

MAK: State taxes pay for education and helping those in need, such as food and medical help for the poor and children. It also includes road maintenance, police and other stuff to support services in YOUR state or community.  There are OVER 40 states that have a state income tax and about 20 states that also have a local tax.  We’re one of the few with a county tax.  Yikes.  So, if they don’t TAKE TAKE TAKE some state and local income taxes from you, they’ll get you another way. PAY ATTENTION!!! Tennessee doesn’t have an income tax, but it’s sales tax is pushing almost 10%. It’s on almost everything you buy. Nail polish, dog food, cars, video games, back scratchers and even guitars. Gibson produces guitars in Montana. I love dad’s custom Gibson hummingbird. When he was there, he got to go to the Gibson workshop.  If you bought a guitar in Montana, you wouldn’t pay sales tax.  Cool, huh? For a really nice guitar,  that would save you over $350 compared to Indiana. If we go back t  to Tennessee, they have a tax on food of 5%, but here we don’t have any tax on food. Big difference. We want you to be more knowledgeable about this stuff, so take a look next time you buy something.

GRANT: When we talk about taxes, and managing your money, you have to think about Willie Nelson.  He is a famous country music singer that got into money troubles after taking advice about how to do his income taxes.  Well, the internal revenue service, which is like the police for taxes, said Willie didn’t pay the right amount.  It was the ‘90s and the IRS said he owed $16.7 million.  He did like to spend money, and though he took some bad advice, he didn’t have the cash to pay.  He was a very successful musician with 95 studio albums to his name. To pay his taxes, the IRS tried to sell all his stuff. Even though he was famous, and his stuff was worth a lot, you have to understand that Texas LOVED Willie. They didn’t want to buy any of his stuff, because it would feel like stealing it from him.  But, there was a group of people who bought his house on 44 acres in Austin, Texas at auction.  It was a group of farmers who Willie helped, when he raised money for farmers at a concert called Farm Aid.  They later sold it back to him, so he could have it back.  In order to pay his taxes, he went back to doing what he was great at…. music.  He put 25 songs on an album, with his famous guitar Trigger at his side, and percent of all the sales went directly to the IRS.  The album was called the “IRS Tapes: Who’ll Buy My Memories?”, it was initially sold by phone, where you called 1-800-IRS-TAPE.  Crazy stuff, but we couldn’t make it up if we tried.

DAD: Ok, we should stop there, and finish up assessing your situation on the next podcast. “On the road again”.  Ok, I just had to do that once, especially since we ended on Willie Nelson. Ok, until next time, don’t forget to like, subscribe and comment on the podcast.  And, we’ll see you next week, with a couple more stories. Until next time.


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