How long does it take the average person to become RICH

Aim for the stars and own the moon

Too many people with very short term goals, living on week to week incomes. Then they tell me I must be brave to invest, I recon it's the other way about, I'm too scared to live week to week.

 

I like the Wolf of Wall Street, his quote below.....luv it


"Most people fail in life not because they aim too high and miss, but because they aim too low and hit.”

 

Based on current trends (last 35 years or so) probably sometime between 2080 and 2100.

 

So many categories.
How about making it simple at 100m.
Above is rich, below is not yet rich.

 

It's relative thought isn't it? It depends what your requirements are. We have one poster with a $8 million unencumbered who doesn't find the income enough. Whereas I might find $4 million unencumbered more than enough because I have a different level of needs and wants.

That said, "wealth" is not something that particularly interests me. I have no idea what my net wealth is. I just email my mortgage broker and if I can afford to borrow enough to do my next project... all good. Otherwise I will have to reassess.

 

So lets take an example

Lets say Joe Blow is 50 years old and earns 200k

So (200k * 50)/ 10 = $1m is that correct?

That seems a bit low.....

Also...what about investment income should that be included? I know questions...questions...

 

That formula is one of the loosest I've seen.

 

Ok...then maybe we need to have female version with

Jo Blow is 50 years old....earns 200k and has 300k rental income

So ((200+300)*50)/10 = $2.5m networth.....looks like formula is more accurate.

Looks like the wealth of a few people on SS......

 

I've seen this formula in a few places but what is the rationale thinking for it? What does it say about people who have achieved substantial pay rises recently or who went to University so started work late but on a higher income?

 

That's an odd formula.

What if the man is 50, earn's 50K/ year. He would feel wealthy with 250K networth?

Something is very wrong here!

 

Pretty sure that was the formula given by Thornhill during his course. Hopefully I remembered it correctly.

 

Yes, it's also the formula in the millionaire next door. It's not supposed to be about whether your're wealthy or not but rather the expected amount of networth you should have based on your age and income.

I'm not the biggest fan of it though for the reasons in my other post.

 

I think $5 Million cash/net worth is about where you can feel "wealthy". Its enough that you could be ultra ultra conservative and park money in a low yielding but super safe online saver at 1.5-2% and make 100K per annum without eating into capital.

Of course, if the RBA cash rate were to rise, and banks paid 2.5-3% , that figure might only need to be 3-4 Million.

Unfortunately, in a low rate environment, $1Million doesn't really feed you for a year. Nor does $2 Million, to be fair. Unless you want to dive into the ETF/LIC game and take all that capital risk.

 

I'd consider myself rich if I had 300 grand. Y'all just a bunch of fat cats

 

Time it takes to learn the lessons of getting rich - decades.
Time it takes to get rich - 5 days, 8 hours, 17 minutes and 12 seconds.

 

$5m is the new $1m.

 

Marry the woman or man you love and loves you.

PP

 

Also assumes everyone is content with net yields of 2.5%?? Madness

 

It's funny how or who we like to compare ourselves to define Rich isn't it?

Last week, one of my girlfriend's Dad passed away at 92...he left behind shares, properties, cash worth $20 million..

YET he was the stingiest person you ever met...when you visit his house, it was dark and dingy...all his furniture was second hand and do not match..

My friend told me, initially the Dad was comparing himself with his friends' net worth as to what is rich...but towards the end, he surpassed them and was just comparing himself to himself...and he did not know when to stop..he refused to be generous to his kids/grandkids and used to kick his wife as she grew fat and depressed...HE NEVER TOOK A HOLIDAY!

All the kids refused to have anything to do with him..towards the end he had dementia and was sh%%XX all over the house...they just put together a rushed funeral and cremated him.....and now sitting down to divvy 20 million up!
Did they remember their Dad with fondness with this largesse? Nope! They despised him for a childhood of deprivation and embarrassment!

Moral of the story: the one who knows when is Enough is the one who is truly Rich!
(sad to say, i myself still do not have this knowledge though!)

 

But they'll happily spend that money. Good thing for them he didn't donate everything to charity, then they can really HATE him.

It's hard to reach a stage of enough, am also always chasing something.