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

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

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  1. sanj

    sanj Well-Known Member Premium Member

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    income and assets are 2 entirely different things
     
  2. sanj

    sanj Well-Known Member Premium Member

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    plenty of rich people work, some for others and many for themselves.

    bank ceos can make $20m in one year and by any metric (apart from Barnes' proprietary one) are most likely to be considered rich but they still work.

    Warren buffet is one of the world's richest people and still works.

    the atlassian founders are worth close to a billion if not more and still work day to day in their business, there is nothing I've ever seen to suggest rich people don't work
     
  3. sanj

    sanj Well-Known Member Premium Member

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    Why is this 5% metric always used and everyone assumes resi property calcs are relevant to all situations?

    someone worth 2.4m could be investing all of it in high yielding investments and doing no active work while renting, or could have most of it in property and still be working. there is no hard and fast rule, thats why stats are often so important as they provide some idea of the broad picture since individual examples are impossible to extrapolate to the country as a whole
     
    Last edited: 14th Mar, 2016
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  4. Blacky

    Blacky Well-Known Member

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    It is also highly likely that a lot of their other assets are kept outside of their own names. Therefore incomes from trust distributions/dividends would increase their incomes.

    In saying that it indicates that on average wealthy families have dual incomes. Which would indicate to me a lot of the 'real' wealth is kept in other entities, as is the income.

    Blacky
     
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  5. MTR

    MTR Well-Known Member

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    I understand income vs assets, I just did not pay attention, someone shoot me:)
     
    Last edited: 14th Mar, 2016
  6. MTR

    MTR Well-Known Member

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    of course you are correct

    5% because I was being conservative with my figures, as we don't know what the asset class is and I guess we are on a property forum, seems to be the norm, or even less.
     
    Last edited: 14th Mar, 2016
  7. Sackie

    Sackie Well-Known Member

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    download.jpg
     
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  8. Iamnumber5

    Iamnumber5 Well-Known Member

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    Perhaps looking at it the following way makes more sense since we are on PC.

    4 million net worth, assuming 1m being ppor, and 3m being IP with yield of 4-5% which is $120,000-$150,000.
    Let's not forget the capital gain which let say the "cliche general rule" in property double every 10 year (even though it's non linear, under certain circumstances I do believe it if it is stretched over long period of time), that's another 10% of 4 million, which is $400,000 per year.

    That's a total of $520,000-$550,000 per year, and of course we need to take into account inflation.

    Or am I being delusional?
     
  9. MTR

    MTR Well-Known Member

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    Not delusional, but personally I would be not count on the capital gains but working on the figure today because realistically that is all you have.

    5% is very low I agree with Sanj, you can improve on yields, dependent on asset class, whether you trade property/shares, business etc

    For example I am at around 15% net on my cash flow for the USA properties.

    I read somewhere that bank shares can be as much as 11% gross?? not sure whether this is fact. There is a thread on shares, may be of help.

    Developing property can help improve the odds, I suppose many ways to achieve a better outcome, plenty on this forum doing it
     
  10. Iamnumber5

    Iamnumber5 Well-Known Member

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    15% of initial purchase price or the current valuation?
    Either one you are doing very well.

    Development on the other hand, I consider it a business instead of an investment, and therefore making sense if it yields a lot more. Even though in your interstate development only requires 4 hours/week of your time. Wish I am in the same position as you :).
     
  11. MTR

    MTR Well-Known Member

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    If I can do it anyone can do it.

    Start with smaller projects (lower risk) like a house on a corner development site.
    Networking with locals and professionals on the ground.
    I networked in the main with investors from SS, you soon find out who the BS artists are and who are the ones that actually deliver. This is the best way to learn and if you think I don't make mistakes, far from it.

    Its actually not that hard developing when you are not in the State as long as you have the right people working for you on the ground
     
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  12. MTR

    MTR Well-Known Member

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    bump, this is an old thread 2016

    I wonder if these stats have changed much???????
     
  13. craigc

    craigc Well-Known Member

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    I would say as more years pass the reliance on super % will be increasing as the more years of compulsory super contributions (since 1992) will help more ‘recent’ employees.
    Hence a reducing pension reliance but it’s only 3 years since these stats, so I suspect it will be a slow progression to more super reliance/independence & less on the pension.

    There will of course always be those without sufficient super for those who are non-working or lower socio who may rely on benefits.
     
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  14. MTR

    MTR Well-Known Member

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    Good point
     
  15. Indifference

    Indifference Well-Known Member

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    I doubt any significant change... if anything with the current situation it might even be worse than previous
     
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