Some Facts - Where most Australians are Financially......

Discussion in 'Money Management & Banking' started by MTR, 9th Mar, 2016.

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  1. barnes

    barnes Well-Known Member

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    I had to use the name of somebody people might know. There are a lot of great traders out there but they are known more to the trading community and not to the general public. And yes he is a great trader, but if he has debt - he is not rich by my standards.
     
    Last edited: 14th Mar, 2016
  2. barnes

    barnes Well-Known Member

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    Yes that classifies as trading.
     
  3. barnes

    barnes Well-Known Member

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    Well, property doesn't double every 10 years, at least not anymore. And if it grows only 40-50% in 10 years time you are not making anything, debt eats all your profits.
    You know that and so you get creative, invest overseas and do developments, that's a whole different ballgame. :)
     
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  4. Sackie

    Sackie Well-Known Member

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    I know its very unpopular to say there are no 'absolute rights and wrongs' with investing. Personally, I don't agree and think that's rubbish. It's like saying to a person holding a bucket with a few large holes in it, trying to fill it to the top with water, "don't worry, you'll get there eventually, nothing wrong keep going". :rolleyes:
     
  5. mrdobalina

    mrdobalina Well-Known Member

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    George Soros can take his $24.5 billion back to the ghetto (by your standards).
     
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  6. truong

    truong Well-Known Member

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    OK, lots of mentions about rich and poor people in this thread, but what about an “official” definition? This is the closest by ABS (to get 2016 figures, multiply the $ by 1.1 roughly):

    [​IMG]

    So typically:
    • The poor: net worth $34K, disposable income $1230/wk, don’t own home but rent, more sole parents, only 1 person working in household, younger.
    • The middle class: net worth $481K, disposable income $1760/wk, mostly own home with mortgage, more families, only 1 person working, middle age.
    • The rich: net worth $2430K, disposable income $3180/wk, mostly own home outright, more families, 2 persons working, nearing retirement.
     
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  7. RumpledElf

    RumpledElf Well-Known Member

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    On the upside, at least he doesn't have seriously entrenched habits as he's so new to the workforce. He's refinanced that card out to his regular bank now and the combined limit now is much lower. I'm introducing him to the wonderful world of Gumtree bargains too ;)

    He's still pretty close to what most people normally do though, and he regularly runs out of money before the next payday. Its the classic scenario. You want something? Got a steady permanent job? Just get it on credit NOW, don't save up for it.

    Used to have some inlaws a few years ago that did this at a larger scale, always with the nice house in the nice area and the nice holidays and the nice cars, keeping the mortgage maxed by refinancing in any personal loans as any new equity came in. This is a remarkably common financial pattern and it gets people into deep, deep trouble when someone loses their job.
     
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  8. RumpledElf

    RumpledElf Well-Known Member

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    You mean gross income per week, not disposable income. I would also argue that that 'low net worth' group is not the poor, its just lower middle class and is only slightly below median, which means a big chunk of the population is worth less. The poor are the ones on $200-300 a week gross individual income.
     
  9. truong

    truong Well-Known Member

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    ABS uses household disposable income as their measurement.

    You can use whatever definition you'd like. That was ABS's way of looking at it. They classify Australians in income/wealth groups (quintiles, deciles, etc...) and go from there. The "low net worth" group is the lowest on their scale.
     
    Last edited: 14th Mar, 2016
  10. RumpledElf

    RumpledElf Well-Known Member

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    Your post didn't use the disposable income line, you used the gross income line and labelled it disposable income. Just nitpicking :p
     
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  11. truong

    truong Well-Known Member

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    Sorry my fault.
     
  12. b7277

    b7277 Active Member

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    42% can post their questions here and maybe find answers.. ;)

     
  13. MTR

    MTR Well-Known Member

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    Just not sure how you can have a disposable income of $3180 wk if your net assets are $2430K?... what am I missing??
     
  14. mrdobalina

    mrdobalina Well-Known Member

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    That probably includes the ppor.
     
  15. Johnny Cashflow

    Johnny Cashflow Well-Known Member

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    Or go for cashflow that's what I'm doing
     
  16. MTR

    MTR Well-Known Member

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    sorry my maths is bad, not sure what you mean, I still don't get it, I am calculating 5% returns on $2430K, there is no way you will achieve $3180 pw???
     
  17. mrdobalina

    mrdobalina Well-Known Member

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    The net worth probably includes the primary residence. The gross income includes income generated from 2 people working, not necessary from returns from investible assets.
     
  18. MTR

    MTR Well-Known Member

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    Got it, I expected the income to be generated from assets/investments, I assume you are not working if you are rich.

    Thanks
     
  19. Cactus

    Cactus Well-Known Member

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    I want to be not rich like him too then.
     
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  20. mrdobalina

    mrdobalina Well-Known Member

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    I don't consider that high net worth metric by ABS as being "rich". It would probably include the top 5% of households. Top 1% is closer to $5m net worth.