Raising the minimum wage isn’t always the best course of action for the American economy as a whole. The recent push to raise the minimum wage to $15 per hour has many negative effects that few people take into consideration. There are effects of raising minimum wage.
There are many negative effects of raising minimum wage in the United States.
Does the minimum wage need to increase? Maybe it does. Does it need to more than double, jumping to $15 per hour across the country? Probably not – I think that it’s a bad idea. There are negative effects of raising minimum wage too much and too fast.
Here are a few things to consider why jumping from the current national minimum wage of $7.25 to $15 per hour isn’t a good idea.
Fewer Jobs Are Created With Higher Minimum Wages
One of the negative effects of raising minimum wage is that fewer jobs are created.
Many employers will choose to hire fewer employees than they would have done. If the federal minimum wage more than doubles to $15 per hour, many employers may be forced to hire one person instead of two for job openings. They will be forced to simply do without the additional help. Now one person will cost as much as two with a $15 minimum wage.
A higher minimum wage will also increase the costs of items that the average American buys. Do you think that the price of your McDonald’s Big Mac will remain the same if the fast food chain has to pay double for its labor costs?
We will start to see the cost of a lot of items in the country rise. It will bring about an across the board rise of inflation as a result too. [click to continue…]
Don’t get me wrong. I’m not mad, and I know that I shouldn’t be comparing myself to others. We’re all in separate places with different goals and situations in life. But, I can’t help but continue to dwell on J Money’s net worth updates when he posts them every month.
But, this time, I think I’m onto something. I think that he’s forgetting something, and subsequently so am I. We all might be forgetting something in our calculations.
Maybe there is more to these net worth numbers and the simple calculations of our assets and liabilities. I think J Money is unrepresenting his net worth and leaving money on the table. I think we all are. Our net worth numbers can be even larger, and maybe some of us are closer to J Money than we think.
You’re Leaving Out a Few Assets
Where do you draw the line on what is an asset? We all understand thanks to J and his posts that to calculate your net worth, you simply subtract all of your debts from a list of assets like your home, investments, and your cars.
But, we are leaving out key assets to our calculations. It struck me when I had an argument with my friend Blake a few months ago whether or not your cars deserve to be included in your net worth as an asset. It does! I agree with J in that respect. My friend was leaving out his cars as an asset, but he was surely including his car loans in the list of liabilities. This greatly underestimated his net worth.
So, that got me thinking about other assets that we typically do not include in our net worth calculations. I think that we are a little better off in our wealth than we all think.
Other Assets Missing from Your Calculations
I can remember getting my wife’s wedding band and engagement ring appraised after we got married. We needed to get an additional rider on our homeowner’s insurance policy because there is typically a very low threshold for jewelry. The same is often true for expensive electronics and gun collections. You may want to check with your homeowner’s insurance company.
J Money may even need to check on whether or not his coin collection is covered. But, that brings up the question – Are these guns, coins, electronics, jewelry, and the like included in your net worth calculations? Not many of us are adding them to the totals, and we should be. We’re leaving money on the table so to speak. We have more assets than we realize.
What about including websites and blogs that you own in your net worth calculations? The thought hadn’t really struck me before. But, they can be a great asset that you should include.
I tell people that I’ve lived the blogger’s dream. A couple of years ago, I was lucky enough to sell a blog that I had started just as a hobby. Most bloggers start with great intentions and want to help others. I started with a passion for personal finance, education in the subject, and then a love a writing. It blew my mind that years later a company would pay me money to buy the blog that I started as just a hobby.
Remembering that made me think about how the cash from the sale of the first blog boosted my net worth that year. It also made me realize that I don’t include the value of my blog, Money Q&A (I ended up starting another blog eventually.), in my current net worth calculations.
By simply using a simple multiple of the blog’s annual earnings, I’m leaving thousands of dollars off of my current net worth calculations. I could only begin to guess what Budgets Are Sexy may be worth and what it would add to J Money’s net worth calculations when he adds it to the total. But, he should! We all know what an incredible asset it is!
We’re a Society of Collectors
Americans love to collect things. And, often times, our collections are expensive. J Money has talked about his love of coin collecting here on his blog many times before.
Coin collecting is just one example. You don’t have to be an art collector with an Andy Warhol on your walls to have something that can be added to your net worth bottom line.
But, I’m quite sure that you have a collection of something that is quite valuable when you add it all up. Do you have antiques, a baseball card collection, a stable of blogs, or a rare first edition book collection? These are just a few examples of things that we collect that can be added to your net worth calculations.
Where do you draw the line? What should be included in your list of assets when you’re calculating your net worth?
What do you think? Do you include coin collections, cars, hobbies, blogs, and the like in your net worth calculations? Why or why not?
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