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What do you consider wealthy (money, not life experience or love etc)?

What do you consider wealthy (money, not life experience or love etc.)?

  • $100,000 liquid regardless of net worth

    Votes: 4 13.3%

  • $50,000 liquid and $500,000 net worth

    Votes: 3 10.0%

  • $500,000 net worth regardless of liquidity

    Votes: 3 10.0%

  • $100,000 in liquidity and $1,000,000 net worth

    Votes: 7 23.3%

  • $1,000,000 net worth regardless of liquidity

    Votes: 8 26.7%

  • $200,000 in liquidity and $4 million net worth

    Votes: 14 46.7%

  • $4 million net worth regardless of liquidity

    Votes: 9 30.0%

  • $5 million or over net worth regardless of liquidity

    Votes: 10 33.3%

  • $10 million or over net worth regardless of liquidity

    Votes: 12 40.0%

  • It takes much more to impress me, and it needs to be liquid.

    Votes: 1 3.3%
  • Total voters
    30
I chose all except for 100,000 liquid regardless of net worth. I almost chose that one as well, but was conflicted. A one time payment of $100,000 to someone with a net worth of 0 doesn't necessarily render them "rich" in my opinion, however depending on where this person lives, a $100,000 yearly salary could definitely be considered rich. In small town Michigan where I grew up, $100,000 yearly is more than enough to live a very decent lifestyle. In San Fransisco, $100,000 won't go as far.

As for the rest, I consider them all rich.
 
Goshin said:
This is actually something I thought through, very carefully, a few months ago.


Five million in net worth, minimum, to be considered actually rich. Below that, you're really just "middle class".

See, for 5 mil net worth, you could generate around $350,000 to half a mil in income annually, without working other than managing your investments. You have to pay taxes on that of course.... right now, 15% cap-gains probably, which means probably $300-425k after tax. That's a nice income. You could hire four or five houshold servants and still live quite comfortably on the rest: property, nice house, cars, boat, vacations, no real worries about medical care or unexpected expenses, Suzie's braces or Jimmy's college.
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Do you realize that the mean net worth of people in the 90th-100th percentile is 4 million? The median is just under 2 million. Is theaverage person in those percentiles not rich? Do you really think to be rich you have to have so much money that you don't have to work AND can afford to hire a servant?

It's useful to define what is rich by defining what is NOT rich. The supposedly "middle" class person who owns a $1,000,000 property, two or three nice cars, and is able to put two kids through college, probably has a net worth of around 1-1.5 million (maybe higher, college isn't cheap). That puts them in about the 90th percentile in this country. I'd say that pretty much disqualifies them from being middle class.

For this reason, I would define "wealthy" of having a net worth of around 1 million. Remember also that many people own $1,000,000+ properties and nice things yet don't have a net worth of 1 million, because they don't own their assets outright (yet). Those are probably the groups of people I would consider upper-middle class.
 
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Having lived lifestyles from very rich to very poor (right now I am right on the bottom end of upper middle class @ 120k/yr). I see rich starting at about 150k to 200k per year. At that point, people have substantial budgets for luxury items or experiences. One goes from buying necessities to buying nice stuff. Also one has substantial money to invest for future earnings.
 
megaprogman said:
Having lived lifestyles from very rich to very poor (right now I am right on the bottom end of upper middle class @ 120k/yr).
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just to point out - as I respect you, and don't want to see you violate your ideals - you are making too much, and should redistribute about 30-40K of that to me :D

I see rich starting at about 150k to 200k per year. At that point, people have substantial budgets for luxury items or experiences. One goes from buying necessities to buying nice stuff. Also one has substantial money to invest for future earnings.
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color me confused. at 120K you're not buying nice stuff? or are you distinguishing here between nice necessities (a house with pool in a good school district) and nice toys (motor boat with accompanying jet skis)?
 
cpwill said:
just to point out - as I respect you, and don't want to see you violate your ideals - you are making too much, and should redistribute about 30-40K of that to me :D
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Then you do not understand my economic position. (and I suspect that you have no desire to do so as you tend to want to cast me as a socialist and not a mixed economyist (whatever the word for it is), nor do you take into account my motivations even though they are in threads all over this forum).

cpwill said:
color me confused. at 120K you're not buying nice stuff? or are you distinguishing here between nice necessities (a house with pool in a good school district) and nice toys (motor boat with accompanying jet skis)?
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I am buying nice stuff, meaning that I am going past bare necessities to luxuries, heck, I dropped $1000 bucks on some furniture saturday with no real impact to my monthly budget.
 
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The words rich and wealthy are not synonyms to me. Rich is more specifically money or its absolute equivalent. Wealth is rich plus class relationships. My and several other scales, consider rich to be $1,000,000 net or more with access to a significant portion in cash quickly. To be wealthy requires functioning relationships with several other wealthy individuals and they generally require $10,000,000 minimum, typically much more.
We happened to be in Sun Valley at the same time a meeting of the very wealthy and financially powerful happened. It’s fairly regular there. Hailey has the airport. Normally two or three corporate jets are parked there, just N numbers showing, no logos. During the private gatherings there were over 40 business and regional jets, 20 to 40 passengers, parked there. If you were late no more parking was available and your jet had to fly back to Idaho Falls for parking. These jets have very small N numbers on them, too small to meet regs I’m sure, and no other markings. One more note of many possible: We were shopping for a cabin and visited a realtor; she had substantial knowledge of the meetings. There was a cabin for sale; we drove by to see it from the road. Its roof was copper panels about abut 4 x 24 ft. Each was unique because the peak had a complex curve. There were several buildings on its grounds; one was a theater for 75. Our guess is that the seats were plush too. That is a cabin for the wealthy, not for the rich.
This is why I selected "It takes much more to impress me, and it needs to be liquid."
 
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megaprogman said:
Then you do not understand my economic position. (and I suspect that you have no desire to do so as you tend to want to cast me as a socialist and not a mixed economyist (whatever the word for it is), nor do you take into account my motivations even though they are in threads all over this forum).
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You have it + I want it = I have a right to it.


alright everyone, time to organize Occupy Megaprogmans' Yard!!! down with the top 15.9%!!!


I am buying nice stuff, meaning that I am going past bare necessities to luxuries, heck, I dropped $1000 bucks on some furniture saturday with no real impact to my monthly budget.
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nicely done. we just spent a bundle on plane tickets (international... it's a racket I tell you, these darn big airline corporations being all corporationy), but it took a hunk out of us. ah well. one day. :)
 
megaprogman said:
Then you do not understand my economic position. (and I suspect that you have no desire to do so as you tend to want to cast me as a socialist and not a mixed economyist (whatever the word for it is), nor do you take into account my motivations even though they are in threads all over this forum).


I am buying nice stuff, meaning that I am going past bare necessities to luxuries, heck, I dropped $1000 bucks on some furniture saturday with no real impact to my monthly budget.
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So it really IS just your hate stopping you from buying great tasting tea!:mrgreen:
 
cpwill said:
You have it + I want it = I have a right to it.


alright everyone, time to organize Occupy Megaprogmans' Yard!!! down with the top 15.9%!!!
Click to expand...

If you aren't willing to make a distinction between types of social spending and the underlying reasonings and goals, then your blind spot will cause you to suffer in your ability to debate policy accordingly.

cpwill said:
nicely done. we just spent a bundle on plane tickets (international... it's a racket I tell you, these darn big airline corporations being all corporationy), but it took a hunk out of us. ah well. one day. :)
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You want to buy plane tickets out as far as possible and spend the extra $10 to change it at the last minute.
 
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Harry Guerrilla said:
This is so subjective, that the only possible answer could be, a person who's net worth is greater than 0.
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A person can be making $200,000/year and still have a net worth that is negative $2,000,000.

A person can make $30,000/year and have $50,000 in the bank.
 
GreenvilleGrows said:
A person can be making $200,000/year and still have a net worth that is negative $2,000,000.

A person can make $30,000/year and have $50,000 in the bank.
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In that scenario the person with $50k in the bank, is wealthy than the person making $200k is not.
I believe rich is a state of mind, with wealthy being a person who intends and follows through with, regularly increasing their annual net worth.
 
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cpwill said:
You have it + I want it = I have a right to it.


alright everyone, time to organize Occupy Megaprogmans' Yard!!! down with the top 15.9%!!!




nicely done. we just spent a bundle on plane tickets (international... it's a racket I tell you, these darn big airline corporations being all corporationy), but it took a hunk out of us. ah well. one day. :)
Click to expand...


Flying mid week can resullt in big savings

I saw that flights to asia could vary from $1700 for weekend departure and return dates to as low as $700 ( with various airport taxes being paid) provided leaving and returning mid week
 
SpeakUp said:
If you think you can reliably earn a 7% return on your entire net worth in the long term, please enlighten the rest of us -- for most, such a yield is very unrealistic. The problem is compounded when you take inflation into account.

You also need to account for a house in there somewhere.

If you allow $2M (40% of net worth) for a house and a more realistic 2% yield on the remaining $3M, that's $60K/yr income (less taxes), or about what someone earning $30/hr would make -- certainly not enough to hire staff unless you're talking part-time or illegals.
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cpwill said:
Combined Annualized Growth Rate of the S&P 500 (counting for inflation) since 1980 has been 7.68%. He's pretty much on the right track.



without even knowing you I already know: you need to fire your financial adviser.



:) well, our hope is to get to making 100K post-tax. that way we can live on 50, save 25, and give 25.
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I know of two mutual funds with yieds above 9% right now. Both provide regular payouts of $0.06 per unit per month and have done so for years. Of course both have taken hits in the unit price. But as unit price goes down I can buy more units with the regular payout or through extra purchases
 
Debt doesn't matter in determining whether or not someone is wealthy because it doesn't really affect their buying power. As long as you still have credit, you can always borrow money faster than you have to repay it.
 
Viktyr Korimir said:
Debt doesn't matter in determining whether or not someone is wealthy because it doesn't really affect their buying power. As long as you still have credit, you can always borrow money faster than you have to repay it.
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then the federal government must be fabulously wealthy.
 
cpwill said:
Combined Annualized Growth Rate of the S&P 500 (counting for inflation) since 1980 has been 7.68%. He's pretty much on the right track.
Click to expand...

Using that same site, the inflation-adjusted CAGR from 2000 to the end of 2010 was negative 2.07% -- with significant losses in 4 of those years.

cpwill said:
without even knowing you I already know: you need to fire your financial adviser.
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I wasn't talking about what I have done myself. I was talking about future expectations -- what you could plan on when it comes to retirement -- not past performance.

In addition, I know a number of people with very expensive financial advisers whose portfolios are worth less today than they were in 2000, even in nominal terms; inflation-adjusted makes it that much worse. If they had achieved a 2% post-inflation yield, they would be ecstatic.
 
Lord Tammerlain said:
I know of two mutual funds with yieds above 9% right now. Both provide regular payouts of $0.06 per unit per month and have done so for years. Of course both have taken hits in the unit price. But as unit price goes down I can buy more units with the regular payout or through extra purchases
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A 9% yield with a declining unit price means a net yield below 9% -- it's easy to have a high yield if the yield includes part of your capital....

The current CPI, after correction for government lies, is about 11% (see shadowstats.com) -- so at 9%, that's a negative 2% inflation-corrected yield. If you use the government-published CPI, which is about 4%, the net would be 5%, which is still short of the original 7% claim, even before correcting for the declining unit value.
 
cpwill said:
Combined Annualized Growth Rate of the S&P 500 (counting for inflation) since 1980 has been 7.68%. He's pretty much on the right track.
Click to expand...

Using that same site, the inflation-adjusted CAGR from 2000 to 2010 was negative 2.07%.

cpwill said:
without even knowing you I already know: you need to fire your financial adviser.
Click to expand...

I was talking about typical future expectations in the context of retirement, not my personal past performance.

I know a number of people with expensive financial advisers who have portfolios that are worth less in nominal terms now than they were in 2000 -- and of course inflation just magnifies the problem. They would be thrilled to have had a +2% after-inflation yield.
 
megaprogman said:
If you aren't willing to make a distinction between types of social spending and the underlying reasonings and goals, then your blind spot will cause you to suffer in your ability to debate policy accordingly.
Click to expand...

redistribution of wealth is redistribution of wealth. :) sounds like someone doesn't want to pay their fair share.

You want to buy plane tickets out as far as possible and spend the extra $10 to change it at the last minute.
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We got one flight canceled - we had purchased on that theory, but then it turned out the insurance only covered "for medical reasons". dang corporations, being all corporationy - it's their fault I didn't read the fine print. :mad:
 
SpeakUp said:
Using that same site, the inflation-adjusted CAGR from 2000 to 2010 was negative 2.07%.

I was talking about typical future expectations in the context of retirement, not my personal past performance.
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then your earlier focus on 2000-2010 is in direct contradiction. Until this period there wasn't a single instance of a 10-year period in which the stock market had lost money. furthermore, we are discussing retirement plans, which run closer to 30 years.

1940-1970: 8.04%
1950-1980: 6.98%
1960-1990: 4.59% (looks like inflation in the 70's was a real killer of real return)
1970-2000: 7.52%
1980-2010: 7.68%

or, you could make an argument that properly, retirement savings should be done over 40-45 years:

1940-1980: 6.12%
1950-1990: 7.49%
1960-2000: 6.93%
1970-2010: 5.38%


7% remains a far more likely scenario than -2.
 
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