Choosing kids over savings

And more of the week's best financial insight

a senior couple.
(Image credit: Gettyimages)

Here are three of the week's top pieces of financial insight, gathered from around the web:

On Wall Street, AI still struggles

A great year for the IRS

Last year was a record-setting year for income tax payments, said Justin Fox in Bloomberg. "Americans paid out an estimated 14.7 percent of their personal income in 2022 in what the U.S. Bureau of Economic Analysis calls personal current taxes (mainly federal, state, and local income taxes), an all-time high." The main reason for this record-setting tax burden "is that asset prices rose so much," and people — particularly higher earners taxed at a higher rate — "sold them for big profits." For many others, there was "bracket creep." Inflation caused some incomes to get "bumped temporarily into higher brackets." The good news is that those tax brackets are adjusted for this year. If you're wondering: No, all those taxes didn't cut the deficit, because federal spending rose even more.

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Choosing kids over savings

Many American parents are risking their retirement savings to help their adult children, said Megan Leonhardt in Fortune. A recent survey from Bankrate found that "nearly 7 in 10 parents (68 percent) who have any children age 18 or older have made at least one financial sacrifice to help out their kids." Over half of parents surveyed "say they've dipped into their emergency savings," while about 16 percent said they had "put off hitting their own financial milestones." To be fair, Millennials and Gen Zers faced the Great Recession and a global pandemic right at the points when their careers were just taking off. And one possible bit of relief: 6 in 10 Millennials (ages 27 to 42) now "feel good about their finances."

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