When do you consider some "rich"?
Since a lot of you guys are in IBanking, at what point do you look at someone's salary and be like "damn, that man (or women) is rich"
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I don't look only at salary. My (completely arbitrary) number looking at the general population would be when total assets are valued at $1m+. And before anyone says that's low (which for some it may be) it's more to do with looking generally at the overall population not just your immediate environment.
Clearly this includes property, savings and other assets as well as cash.
Rich is also IMO a matter of liquidity. I knew a guy whose father had properties he couldn't flip. This guy has €20m in unsellable assets and didn't have €30K of cash in his account to pay for car payments, tuition etc. Asset wise he is rich but still can't pay some semi-basic costs.
how does this work? If he can't sell them then those are not the value of his assets?
Of course they count in his value but you can boast about having as many illiquid assets as you want, but if you can't pay for basic recurring expenses like college tuition you aren't going well.
High Net Worth:
~$1-2.5M liquid is "secure, may not need to work to afford a standard middle class life"
~$2.5-4.5M liquid is "comfortable, don't need to work to afford a slightly better middle class life"
Very High Net Worth:
~$4.5-7.5M liquid is "very comfortable, don't need to work to afford an upper middle class life"
~$7.5-12.5M liquid is "well off, can afford an even better lifestyle than upper middle class without working"
~$12.5-25M liquid is "extremely well off, has enough buffer to realistically afford a higher end lifestyle without ever working"
Ultra High Net Worth:
~$25-100M "rich, private banks will be knocking on the door. no private jet yet.."
~$100M-1Bn "super rich, family office is starting to look like a good idea and legacy wealth is definitely in the cards"
over $1Bn "billionaire.. won the game"
over $10Bn "built an empire"
You are so unaware of realistic wealth targets. Idek if you're serious with this but everyone on this site has a preconceived notion that they need to work 80 hour weeks and make millions to end up being well off.
How is it unrealistic?
4% withdrawal on $1M is 40k a year.. on $2.5M that's $100k a year. After you pay taxes on that, how is that living "rich" Instead of middle class? Pretty simple math here.
N.B. this is all with a family in mind.
I consider someone rich when they already have a self made , 5 figure net-worth, right out of the womb via trust fund money from daddy
In a few years, I’ll have that 5 figure net worth!
You are only rich when you aren't trading time for money. Anyone trading time for money is still poor despite what they think.
Even these guys bragging about making $300k - $500k a year when they are working 100+ hours a week on a regular basis are almost retarded because they don't realize how shitty that is adjusted for opportunity cost + actual hours in. Nothing wrong with working loads of hours, but if you're going to do it then do it in a way where it actually builds enough wealth to give you true freedom and not some salary that barely covers COL. :)
Doing what you want, when you want, how you want and with who you want. Freedom!
Yessir.
When they are able to hire hookers that accept credit cards as payment
When you don't experience any anxiety when looking at your credit card payment
When passive income > living expenses
Function of time & money. If you're pulling 50 hours a week and making 500k+ (and actually saving/investing a good portion of it), you're rich. Sure, if you really enjoy it, you can work another 10-15 hours and still maintain a great quality of life (assuming you dictate those hours vs. being forced to stay late in order to get the job done). To the point, where I think, 'Damn,' is pulling $1mm+at 50-60 hrs/week (and again saving/investing a high proportion of it).
Of course, this is excluding family/inheritance money. End of day, I would never consider the trade-off worth it where a guy is pulling $1mm and working 90 hrs/week even if he is 'rich' on paper.
I think rich starts to happen when you don't have to worry about finances.
It's not a number. It's about freedom to make whatever choices you want. I would argue the guy / gal who is comfortable with what they have and can have it on a permanent basis without having to do things they don't want to do (could include work) is far richer than the next guy who makes 10x but must kill himself to feed the beast.
Sick insight bro.
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