Mr. D'Angelo

Thursday 5/23/2013

Derek D'Angelo — Thu, 23 May 2013 12:15:54 +0000

Overview of Internet tax assignment looking at different levels of government and their revenue and spending
- This assignment is due Tuesday upon return from break if you don’t finish it during the 45 minutes in class you have to work on it. I completed this assignment in 15 minutes.
- Some of the lessons gained from this assignment…
  - Notice the effective tax rate is progressively higher for those earning more income.
  - Notice how much money a high income earner pays in taxes.
  - Explore some selected areas of federal government spending.
  - Identified the top 6 areas of federal government spending.
  - State of Michigan tax revenue of $55 Billion
  - Largest category of spending is education.
  - Looked at Sterling Heights for local tax information. Their budget is $85.9 million.
  - Top area of spending is police, costing $251 per resident. I think that is a good deal for the security they provide.
  - The average American works 108 days to pay off their taxes.
  - Federal tax on gas is 18.4 cents, tax on cigarettes is $1, NY has the highest state cigarette tax at $4.35 a pack, CA has the highest state income tax.
  - The top 5% earns 31.7% of income in the U.S., but they pay 58.7% of the tax bill.
  - You need to make $112,124 to be in the top 10%
  - The bottom 50% of income earners pay 2.3% of the income tax.
  - Michigan’s gas tax ranks 6th highest nationally.

Wednesday 5/22/2013

Derek D'Angelo — Wed, 22 May 2013 20:26:56 +0000

Passed out 2012 1040 tax form along with Schedule A & MI-1040.
Discussed some tax basics
- Due by April 15th
- I recommended they get it done by a professional
- What is a “write-off”?
  - Money you are able to deduct from your income. Since your tax is based off of your income this will save you money on your taxes. About $20-$25 for every $100 you are able to deduct from your income.
- Discussed charitable donations
- Withholding
- 1040 form is you personalizing your tax bill
- You want your income as low as possible for tax purposes.
- tax credit is $1 for $1 off your tax bill
I went through the 1040 & Schedule A line by line with students.
Students completed their forms as I went through each line.
Collected forms at end of hour to give students credit for following along.

Tuesday 5/21/2013

Derek D'Angelo — Tue, 21 May 2013 18:55:50 +0000

Collected Chapter 10 assignments from Friday. 10.2 What trends are shaping today’s labor market & 10.3 What determines how much workers earn?
Review of material from Monday
- Labor market trends
- How wages are determined
Shared articles about labor issues
- A Tale of Two Paychecks
  - Low pay for an important job, but it is low skilled and there isn’t money to pay her more. I value the workers at my kids daycare very highly, but can only afford to pay them so much. If prices were higher my wife would just stay home instead of working.
- Muskegon Heights and its emergency manager
  - This is scary. An emergency manager comes in and sells the school district to a for profit charter school. All contracts were terminated. Teachers could reapply for half pay at the new employer.
- The Benefits to BS ratio
  - Low B to BS ratio will cause people to leave a profession.
- Workers are finding their voice in China, Higher wages in China could affect prices in the USA
  - There is a cost to better working conditions and higher wages in China…higher prices on products here in the US.
- Can Michigan attract knowledge-based industries
  - Our changing economic structure as we shift from manufacturing to a knowledge/service industry.
President Obama on Right to Work

Governor Snyder on Right to Work
- To very opposite viewpoints…which one is right?
Unemployment
- Types of unemployment
  - Frictional-temporary…between jobs. You are an engineer and leave one place and are hired 2 months later by another engineering firm.
  - Structural-longer term…mismatch between jobs available and skills of the workforce.
Chapter 10 Test

Chapter 10 Test Review

Derek D'Angelo — Mon, 20 May 2013 20:34:57 +0000

CHAPTER 10 TEST REVIEW GUIDE

Monday 5/20/2013

Derek D'Angelo — Mon, 20 May 2013 19:41:31 +0000

Finished union facts & stats powerpoint from Thursday
- Students should be completing their packets as we go through this presentation together
Mr. Luce, a teacher at Eisenhower came in to talk to students about his experience as a teacher in a charter school where there were no unions.
- This was eye opening even for me. Very thankful to have Mr. Luce give up his time to come talk to my students!
Discussed the topics from the 10.2 & 10.3 assignment that students worked on during class Friday. This assignment will be collected Tuesday.
- Technology has been the driving force behind changes in the job market.
- Labor force consists of those who have jobs or who are actively looking for work.
  - Bureau of Labor Statistics labor force in Michigan data
- Increased participation of women in the workforce.
- Number of workers involved in the production of factory goods has declined, workers who provide services has increased.
  - Michigan Shifting Gears & Shifting code site. Government help for job retraining.
- Increased productivity of the American worker allows more manufacturing with less workers.
- Increase of knowledge workers who work with information or who develop or apply information in the workplace.
- More working at home & changing jobs more frequently.
- Outsourcing-sending work once done by company employees to outside contractors.
  - An outside supplier can do the work more efficiently and at a lower cost than can be done within the company.
  - The case for outsourcing article from CNN Money
  - GM to team with Nissan on fuel-efficient cargo van article we looked at last week.

- More temporary workers, people employed for limited periods of time.
  - Bob from accounttemps site
- Globalization-We are becoming increasingly connected.
  - Businesses practice off shoring- contract with a company in another country to handle some aspect of its operations to reduce costs.
  - Results in lower prices for American consumers, but the loss of jobs in some sectors of the economy.
- Supply & Demand determines wage rates.

- Skill level affects wage rates
  - The College Payoff
- - Unskilled, semiskilled, skilled, professional
  - What Career Should I choose chart. Compared the number of people employed and median salary for major occupations in the United States.
- Equilibrium wage rate is the market in balance for any particular job.
- Other factors affects wages:
  - Working conditions

- - Location & cost of living
  - Rising cost of fringe benefits-non wage compensation such as health insurance, paid vacation, and retirement plans.
  - Foreign competition
- Wage gap-a difference in wages earned by different groups in society.

Friday 5/17/2013

Derek D'Angelo — Fri, 17 May 2013 18:44:46 +0000

I was at work, but not in the classroom today. Mr. Hallam and I were working on a project for the building.
Students used chapter 10 text to answer 10.2 questions and complete 10.3 graphic organizer assignment
- Students should have no problem completing the assignment during class.

Thursday 5/16/2013

Derek D'Angelo — Thu, 16 May 2013 18:37:58 +0000

Passed out Globalization cartoon & union statistics packet
- Brief overview of chapter 10 about human capital and the labor force.
  - Short discussion on topics like outsourcing.
  - Outsourcing is a business paying someone outside the business to do a job for them.
  - UCS outsources its custodians, Ford Motor outsources many parts to suppliers that a lot of parents work for.
  - GM to team with Nissan on fuel-efficient cargo van article

- Analyzed globalization cartoon. Is Globalization a good or bad thing?
  - Better living through cheaper imports…is this good or bad? The unemployed workers…is this good or bad?
Fast food workers stage brief walkouts in Detroit to protest wages article & video
- Should fast food workers be paid $15 an hour? Why or why not?
- What impacts would an increase in wages have on prices?
- What would your advice be to the final worker in the video that wants more money for working at McDonalds?
- Most say he should improve his skills. This is a problem in Michigan right now and partially why we have a higher than average unemployment rate. We have a mismatch between skills workers have and skills employers need.
  - Snyder worries that state lacks talent to fill jobs article
  - Is skills gap a barrier to jobs in Michigan article
Are professional athletes overpaid?
- Many said yes so we looked into this a bit.
- Detroit Tigers team profile on Forbes
  - Their revenue is $238 million, their player expenses is $143 million.
  - They made $8.4 million last year and the franchise value has increased $235 million to $643 million in the past 10 years.
  - Are the players overpaid or are they just getting their share of the revenue that they help generate?
  - Famous first salary levels in baseball
Compensation for military sample
- Many factors go into how much a worker is paid, including how much money is being brought in in revenue.
Are Unions a good thing? That is going to be an in-depth discussion….Let’s get some facts on unions first.
- Go back to your packet given at the start of the hour and record down the missing information as we go through the PowerPoint.

Wednesday 5/15/2013

Derek D'Angelo — Wed, 15 May 2013 18:22:54 +0000

Checked-in Funding 401ks and IRAs & Rule of 72 assignments from Tuesday
Showed & explained correct answers.
Answered any questions students had from Chapter 8 review guide for test.
Students took Chapter 8 Test.

Tuesday 5/14/2013

Derek D'Angelo — Tue, 14 May 2013 18:59:59 +0000

CHAPTER 8 TEST WEDNESDAY
Answered student questions from Chapter 8 review sheet
Watched portions of Dave Ramsey, Chapter 3
- Watched parts discussing Roth IRA, 401k, 403b, 457 & pensions
Passed out Funding 401ks and IRAs and Rule of 72 Practice assignments
- Students had about 15 minutes in class to work on this assignment.
- Due Wednesday, we will go over together in class before the test.

Monday 5/13/2013

Derek D'Angelo — Mon, 13 May 2013 19:43:57 +0000

CHAPTER 8 TEST has been postponed until Wednesday due to many students taking the AP Government exam tomorrow.
Passed out Chapter 8 Test Review
Reviewed from Friday…
- What is money? It must be something that people are willing to accept as payment.
- FDIC Insurance & its purpose
- Credit cards v. Debit cards
- Fiat money-not backed by gold…only has value because the government says it does.
- Fractional Reserve Banking

Topics introduced today
- Personal Savings Rate in the United States

Federal Reserve Responsibility

Credit Union v. Banks
- Both essentially perform the same functions. Both have checking & savings accounts and give commercial loans.
- The primary difference is banks are owned by its shareholders, credit unions are owned by its members as a finacial cooperative. For this reason they usually are more local and offer better rates and are very responsive to members needs and issues.
- We looked at DFCU Financial who shares their profits with its members…$21 million in 2012!

FICO
- A publicly traded company that provides analytics for financial institutions to determine a borrowers creditworthiness.
- Paying in cash will not help your credit score.
- Click here to find out more about how certain events can affect your credit score.

Bonds
- A bond is a loan in which the borrower promises to pay the lender a fixed rate of interest over the term of the loan and then repay the principal at the end of the term.
- When you buy a bond you are lending money to the issuer. Bonds are generally looked at as a moderately safe, low risk investment.
- There are U.S. Treasury bonds (very safe), Municipal bonds (fund local and state government projects), Corporate bonds (loans to businesses)
- A school district may issue bonds to borrow money to build new facilities or add on to existing ones. Click here to learn more about the 2009 UCS bond issue.
- Junk bonds are higher risk, lower quality that may not be paid back.

Went over details of different investment vehicles. These are accounts you put your money into for retirement and then invest in mutual funds, typically.
- 401k
  - Limited to $17,500 a year.
  - Defined contribution retirement account for employees of private businesses.
  - Cannot take money out before 59 1/2.
  - INVESTING PRE-TAX DOLLARS. You don’t pay taxes until the money is withdrawn.
- 403b
  - Similar to the 401k, but for employees of schools and certain other non-profits.
- 457
  - Deferred compensation. Very much like a 403b, but money can be taken out before 59 1/2.
  - Limited to an additional $17,500 a year.
  - Can max out a 403b AND a 457.
- Roth IRA
  - Grows tax-free, pay the tax now.
  - $5,500 maximum per year.
  - Cannot take out until 59 1/2
- ORDER TO INVEST:
  - 1. 401k up to the employer match. This is free money, do not pass it up.
  - 2. Roth IRA to the maximum $5,500
  - 3. Back to your 401k/403b to maximum
  - STOP WHEREVER YOU REACH THE 15% recommendation for income to be put toward retirement.