# Wealth and its acquisition



## burglar (8 December 2012)

I'll make a start on this topic:

I had no intention to acquire wealth.
I was raised in a family of 8 with a single income.
We were poor, but there was love in the room.

I was content with my lot (still am)!

So what changed:

The Property Boom put a Principal Residence out of the reach of my children.
Renting is not an evil alternative. 
But rents rise as rental properties become more expensive.


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## YMI (8 December 2012)

Thanks burglar, I would have been too scared to starting that since I keep getting :nono: whenever I post something. I have actually 7 siblings and know exactly where you’re coming from. Unfortunately I do not have a recipe on how to acquire wealth but I learned that poverty is incredible important and intentionally boosted (maybe) in order to keep the system running.

When it comes to finance there are reputable people - for example you and me and most of the others - and criminals. Criminals are divided in two sorts again; the ones who robbed a handful of people and stole a few thousands of dollars, they are fed by the government and live in jail. And the ones who robbed tens of thousands of people and stole billions of dollars, they are also fed by the government but live in a mansion.

A few months ago Gina Rinehart said something like if you want to get rich, stop being lazy and start working hard. And I thought this was more true ‘if you want to get rich, you need a lucky dad like she had’ – Gina you filthy ugly b**.  Although I believe she’s pretty smart.


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## burglar (8 December 2012)

Question for Julia:

How much wealth is enough?



YMI said:


> ... stop being lazy and start working hard. ...




You don't get wealthy by working for an hourly rate.
That is income, not wealth!
To acquire wealth you need to make the money work harder.


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## ROE (8 December 2012)

Wealth is when your passive income greater than your expenses...

you can live on 40K a year and have 50K passive income to me that is wealthy...


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## tech/a (8 December 2012)

I'm with ROE.

But to ge t in a position where you have
Enough asset to generate passive income of
Any significance you need to understand that
Opportunity needs to be acted upon quickly
And decisively.
Many freeze and watch it slip straight by.

Eg gold boom $250 - $1750
Oil $25 to $140 a barrel
AUD $.50c to $1.04
The property boom 1996 - 2005
Business and opportunity 2000 to 2010
Bull Market 2001- 2008
Tech boom -- then bust.
Mining boom


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## howmanyru (8 December 2012)

I have heard that if you just do exactly what you love doing, and don't worry about the money, wealth will come to you. I think the assumption is that you will become so good at what you are passionate about others will pay you for your expertise. But I want to stay home and just potter around the garden so not sure how to build great wealth from that!


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## tech/a (8 December 2012)

howmanyru said:


> I have heard that if you just do exactly what you love doing, and don't worry about the money, wealth will come to you. I think the assumption is that you will become so good at what you are passionate about others will pay you for your expertise. But I want to stay home and just potter around the garden so not sure how to build great wealth from that!




Jamie Durie
Don Burke

Maybe the saying is right!


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## YMI (8 December 2012)

howmanyru said:


> ...do exactly what you love doing, and don't worry about the money, wealth will come to you.



Well, if there is anything you really love doing then you don’t mind spending a lot of time on it, like 12h a day, 7 days a week and that’s half the battle. 



> But I want to stay home and just potter around the garden so not sure how to build great wealth from that!



I actually believe you can do whatever you want, if you’re exceptional good at it, it will eventually be possible to live on it even on gardening and pottery - great wealth?? I thought you wrote before the key is not to worry about the money

100 years ago a passionate musician was good-for-nothing and today they earn millions of dollars. So I think the globalization makes it a lot easier and opens doors of which you would have dreamed a few years ago. Two fellows managed to receive useful results when you search the net and built a multibillion dollar enterprise from that. What fascinates me most of this story is that their service is 100% free.

Joanne Rowling said she was basically homeless when she started writing a once in a 100 year success fantasy story. She also said that this is nothing that just pops up in your mind one day, it is actually hard work. She wrote books before that as far as I know, and neither was a success. Personally I think a combination of desperation and her passion for writing brought the success.

A student, not even finished school but also a passion for stories wrote the Eragon trilogy. Publishers refused printing the book so the family decided to publish on their own. Christopher and his mother arranged appointments in countless schools where he would do free readings and rise interest for the book. Suddenly hundreds of people wanted the book and then suddenly a publisher expressed interest and in the end they sold more than 30 million books – but to get there was hard work. 

Btw, what I wrote earlier “stop being lazy and start working hard”, I hope nobody thinks that this is what I believe in. It’s more the way Miss Rinehart expresses the way she looks down on the poor.


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## Julia (8 December 2012)

YMI said:


> Thanks burglar, I would have been too scared to starting that since I keep getting :nono:



You've only made a few posts.  To one of them I responded positively, hence this thread, thanks to burglar.
It's a forum, YMI.  It functions on challenging discussion.  If someone does disagree with you, that should be seen as furthering the discussion, not a personal rejection.



ROE said:


> Wealth is when your passive income greater than your expenses...
> 
> you can live on 40K a year and have 50K passive income to me that is wealthy...



+1.



tech/a said:


> I'm with ROE.
> 
> But to ge t in a position where you have
> Enough asset to generate passive income of
> ...



So true.  Imo this is where so many fail to take advantage of real opportunities.
Once a reasonable level of capital is achieved, relatively infrequent seizing of opportunity (such as when real estate doubled in less than a year) with decent amounts invested, can bring financial security in quite a short time.
Without decent basic capital, however, being limited to small wins on small stakes is imo often going to take a lifetime to amount to anything.



howmanyru said:


> I have heard that if you just do exactly what you love doing, and don't worry about the money, wealth will come to you.



That sounds like some of the hocus pocus in "The Secret" or similar.   Good luck with any positive expectation from that homespun warm and fuzzy stuff.



> I have actually 7 siblings and know exactly where you’re coming from. Unfortunately I do not have a recipe on how to acquire wealth but I learned that poverty is incredible important and intentionally boosted (maybe) in order to keep the system running.



This is the bit I hoped you'd expand on.  Can you describe for us exactly how poverty is "intentionally boosted (maybe) to keep the system running"?

Might perhaps be more likely that a philosophy of a family is ingrained in the growing up years.  With eight children, unless at least one parent was a very high earner, it's unlikely that wealth acquisition was much of a focus in the family.  That suggestion might not at all apply to your family YMI, but your comments  suggest that you were less than well off growing up.

If, on the other hand, a child is inculcated with an understanding of money and how to make it work for you, that adult will likely be doing OK before many others.



> A few months ago Gina Rinehart said something like if you want to get rich, stop being lazy and start working hard. And I thought this was more true ‘if you want to get rich, you need a lucky dad like she had’ – Gina you filthy ugly b**.  Although I believe she’s pretty smart.



Well, this is where you lose me, YMI.  If you have to resort to vicious personal insult in your resentment of someone who has been successful, it says a fair bit about you.


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## So_Cynical (8 December 2012)

burglar said:


> Question for Julia:
> 
> How much wealth is enough?
> 
> ...




John Elliott the former Liberal party president is a good case study of starting the wealth processes with an hourly rate...ill quote the John Elliott wiki.



			
				http://en.wikipedia.org/wiki/John_Elliott_(businessman) said:
			
		

> Career
> 
> Elliott joined the global consulting firm McKinsey & Co. From there, he and several partners acquired control of an Australian Stock Exchange listed jam manufacturer - IXL Ltd.
> 
> Elliott and his team built the company up through a string of acquisitions throughout the late 1970s and 1980s, including Australian corporate icons Elders Limited, an agricultural services concern, Carlton and United Breweries now part of the Foster's Brewing Group and Australia's largest beer manufacturer, and Henry Jones IXL food manufacturer.




The story as i heard it was that John basically saved all his dollars (pay) for a few years, and got some mates to throw in some money and then convinces some private financiers to put in the rest of the money to buy IXL.

Johns savings of the previous 4 or 5 years of working for a salary was the basis of his investment...the rest is history.


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## burglar (8 December 2012)

So_Cynical said:


> John Elliott the former Liberal party president is a good case study of starting the wealth processes with an hourly rate...ill quote the John Elliott wiki.
> 
> 
> 
> ...




You have gone out of your way to disprove what I said and what I meant.
But funnily enough you have proved what I meant.
He took his money and invested it!


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## skc (8 December 2012)

So_Cynical said:


> John Elliott the former Liberal party president is a good case study of starting the wealth processes with an hourly rate...ill quote the John Elliott wiki.
> 
> 
> 
> ...




But he worked for McKinsey! That's the top management consultant firm in the world and has probably one of the most powerful alumni network in the business world. If someone worked there for 5 years, they a) won't have any spare time to spend their money because they work 120hrs a week, and b) should have build enough connections to last several careers. Even Chelsea Clinton (daughter of Bill) worked there. It's definitely not your typical salary job.


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## So_Cynical (9 December 2012)

burglar said:


> You have gone out of your way to disprove what I said and what I meant.
> But funnily enough you have proved what I meant.
> He took his money and invested it!




Not disprove so much as just point out that it has to start somewhere and that somewhere is with a job...Steve Jobs worked for Atari for a while..he didn't save anything but did meet some smart people and that experience helped him later on.

I started poor and im still poor, i used to read a lot of books about rich dudes when i was young and had some experiences, thus came to the conclusion that money makes money, 30 years later i have proved that to be right.

Steve Job had to sell his car to pay for the parts to build Apples first computer...Hugh Hefner borrowed $1000 dollars from his mum to help him publish the first edition of Playboy, the Marilyn pic cost him $600 from memory, imagine explaining to your mum (in 1953) that you just spent 600 of her dollars to buy a nude photo of a starlet so you can publish that photo in a magazine.

You have to have some money and that comes from working and borrowing and the people you know..and then you have to have a plan or an idea, a vision and be able to execute that (place time) even for something as simple as a real estate boom or mining boom.


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## burglar (9 December 2012)

So_Cynical said:


> ... ...




Now that I know where you're coming from we can agree ... money makes money.



YMI said:


> ... If I find a 100 dollar bill on the ground and keep it, I am a thief. ...




If I find a 100 dollar bill on the ground, it's mine.
If I find a wallet containing ID, I return it!


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## Bill M (9 December 2012)

So_Cynical said:


> You have to have some money and that comes from working and borrowing and the people you know..and then you have to have a plan or an idea, a vision and be able to execute that (place time) even for something as simple as a real estate boom or mining boom.




I would agree with that. Most people start off with nothing, some have ideas and visions and others just blow their pay check each week. When I left my Mothers nest I was 16 years old and had nothing, I started a job as an apprentice. A 1st. year apprentice is still one of the lowest paid jobs in Australia but I just battled on for 4 years knowing that there will be light at end of the tunnel.

Then from that ordinary job I started making a full tradesman's salary + overtime. I saved my money and bought a property with 10% deposit down. Others at age 20 were still blowing their pay checks from week to week. Then I saw better job opportunities in other states so off I went to chase more money. I believed and invested in property and that ordinary job and tenants paid for them. Eventually I had 3 properties and I was working 2 jobs to pay for the loans, I didn't mind this because I knew there would be a pay off one day.

That pay off came years later, I sold and I made decent profits and then I invested in stocks. I rode the long run up to 2007 and then the crash came. I always believed in having cash on hand just in case of a crash and as markets started sliding I averaged down into the markets. I saw an opportunity to buy CBA at $26 and I took it, now they are $62. People said stupid things like I was crazy and the Banks could go under, I never believed this for a second. Anyhow CBA was a pay off too, I sold the lot at $58.50. I saw an opportunity and took it, I may not have picked an exact bottom or top but it was close enough for me.

So in summary it was all hard work in ordinary jobs, then investing in real estate and stocks. I am Looking for investment  opportunities all the time, even now and there is plenty out there. It has all paid off and now I am retired and living off passive income from my investments. Some of my mates are still blowing their pay checks from week to week. Nothing is free, you alone have to make it happen. Good luck everyone.


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## DocK (9 December 2012)

Bill M said:


> I would agree with that. Most people start off with nothing, some have ideas and visions and others just blow their pay check each week. When I left my Mothers nest I was 16 years old and had nothing, I started a job as an apprentice. A 1st. year apprentice is still one of the lowest paid jobs in Australia but I just battled on for 4 years knowing that there will be light at end of the tunnel.
> 
> Then from that ordinary job I started making a full tradesman's salary + overtime. I saved my money and bought a property with 10% deposit down. Others at age 20 were still blowing their pay checks from week to week. Then I saw better job opportunities in other states so off I went to chase more money. I believed and invested in property and that ordinary job and tenants paid for them. Eventually I had 3 properties and I was working 2 jobs to pay for the loans, I didn't mind this because I knew there would be a pay off one day.
> 
> ...




Great post Bill   I had a little chat to the spouse a little while ago and we agreed that unless one is lucky enough to have chosen wealthy parents, the old adage "your reap what you sow" generally runs true.  We also put our heads down and bought the first home while quite young, while many of our friends were spending their money on travel, down the pub etc, and then concentrated on reducing the mortgage as quickly as possible.
We know many people like us - work hard, live within your means with an eye to the future.  My story unfortunately is not as rosy as yours - due mainly to the different decisions we made on the investment side (although I hope to correct that by the time I'm retirement age). 

To my mind, the decisions we make and the paths we take make the crucial difference.  Those that either can't or won't build up any capital to invest will never achieve "wealth", but those that do but then make the wrong investment choices will also fail in their goals.  Tech/A put it well when he said 







> But to get in a position where you have  Enough asset to generate passive income of Any significance you need to understand that Opportunity needs to be acted upon quickly And decisively. Many freeze and watch it slip straight by



.
My husband and I were both raised in homes where risk was to be avoided at all costs - our parents worked hard, paid off their homes and then put their savings in term deposits.  Investing in real estate or shares was seen as high risk.  Both of our fathers had only one employer in their working lives.  My husband and I often discussed the possibility of buying an investment property during those boom years, but couldn't quite get past the desire to have our own home paid off completely first.  There's a perfect example of opportunity missed.  When we did finally make the leap into the investment arena it was at completely the wrong time and the wrong strategy, which then resulted in us being in no position to take advantage of the bottom of the market in 2009.

So although I agree with the comments of yours that I've bolded, as in it all starts with hard work and there's usually no easy ride, I'd go one further and point out that it's also so very important to make the right decisions at the right times.  Any investment is a risk - it's not surprising that some of the wealthiest people have gone broke a time or two along the way.


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## Bill M (9 December 2012)

DocK said:


> So although I agree with the comments of yours that I've bolded, as in it all starts with hard work and there's usually no easy ride, I'd go one further and point out that* it's also so very important to make the right decisions at the right times*.  Any investment is a risk - it's not surprising that some of the wealthiest people have gone broke a time or two along the way.




Thanks for your kind words. By the way, don't worry I've had quite a few investments blow up in my face along the way, but one does learn from that. The other point I've bolded is so true too, I will use my personal example of CBA. I would definitely not be a buyer at $62 but would definitely be at $26. Another is real estate. 3 years ago I moved out of the Northern Beaches of Sydney and bought a property up on the Central Coast. Now I am thinking about selling here and purchasing a property back there. I can tell you for sure and without doubt that prices have increased in the last 3 years on the Northern Beaches. So much for the silly predictions of crashes for the area. I have no hesitation of repurchasing in such a popular area with high demand at todays prices, some people would say that's risky, I would say it would be a good long term investment.



ROE said:


> Wealth is when your passive income greater than your expenses...
> 
> you can live on 40K a year and have 50K passive income to me that is wealthy...




As always, spot on there ROE. Totally agree.


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## tech/a (9 December 2012)

To add to some of *Bill* and* DocK*
comments.

Mitigation of risk is one of the most important investment topics there is.
I could---but wont prattle on infinitum
While identification of opportunity can be honed as a skill set------ the mitigation rather than the avoidance of risk needs to follow right behind the decisive action upon finding an opportunity.

If that risk is *NOT CLEAR* (Ie a developer wants your money in a property deal) or the risk is or could  expose you to ruin or something like it. 

*THEN---NEXT!!*


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## Calliope (9 December 2012)

ROE said:


> Wealth is when your passive income greater than your expenses...
> 
> you can live on 40K a year and have 50K passive income to me that is wealthy...




Mr Micawber said it first;



> Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pound ought and six, result misery.
> Charles Dickens, David Copperfield, 1849


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## YMI (9 December 2012)

burglar said:


> If I find a 100 dollar bill on the ground, it's mine.



because you are the burglar

Acquiring wealth seems to involve hard work in the vast majority of all cases. And loving your work seems to help essentially in the process of success. Even betting on stocks or any other investment seems to require a good portion of work (research and learning about strategies) otherwise it's just a game of poker.


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## YMI (9 December 2012)

*Hi, the following is a bit boring and perhaps off-topic.* Sorry but I was asked to explain that better.



Julia said:


> ...If you have to resort to vicious personal insult in your resentment...



Seems like I caught your attention here Julia. I can take that back and claim the opposite if you are worried about the word ‘smart’. It may not be clearly understandable from my poor articulation, I don’t care about her body shape, what I wrote is more what I think of her character. Sure I don’t even know her but telling people simply work harder and don’t complain after everybody knows that she started from a totally different level than 99.9% of the rest of the population is actually a bit cheeky and she should know better than anyone else that it is not just hard work necessary for success. Nevertheless I should have left this bit out of my post, didn’t know she’s a friend of yours



> This is the bit I hoped you'd expand on.  Can you describe for us exactly how poverty is "intentionally boosted (maybe) to keep the system running"?



Again, I thought it’s easy understandable but because of my bad articulation probably not. It is like without light no darkness – this is easy to understand – or without sound no silence. I am not talking about anyone particular but in order to maintain their wealth well-heeled people are interested in a financial gap between poor and rich - easy. Okay, there are lots of wonderful people who support less fortunate ones but very few would continue the support if they were on the same financial level or lower than the one they are helping. So a gap between poor and rich is necessary. Is it intentionally boosted like a conspiracy? No, I don’t think so but our system, not only in Australia but everywhere, requires poverty and wealth.

Here is an example; give everybody on earth evenly 1 million dollar. What could you actually buy with your million? A nice house? I don’t think so. A car? Perhaps a cheap one – wealth and poverty wouldn’t exist anymore, no one would suffer from hunger just as no one could afford excessive luxury. Obviously some would save more, some would spend more and after some time the old order would be restored again.

*Why is wealth and poverty necessary to keep the system running?* I think it’s a psychological thing. We try to be better than others and accumulating wealth is a good way of proving that one is better. If everybody is forced to have the same, then there is no incentive for working harder or saving more. The idea of communism is a bit like that and we all know that it doesn’t really work. That is actually the main reason for the Euro crisis, some European countries work more efficiently than others and therefore can sell their products more competitive than others. Before they adjusted the lower efficiency by higher inflation in certain countries, but now they have the same currency and that could eventually lead to the fail of the system if they can’t find a solution. What are the options? They can make these countries intentionally poorer by reducing their wages – then they risk a national uprising. They could also raise the wages in the more efficient countries – then they lose competitiveness compared to the rest of the world. 
And I also believe that rich people try to keep others down in order to retain or further increase their wealth. A well-known mega-example is Apple’s and Samsung’s patent war.


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## DocK (9 December 2012)

YMI said:


> *...snip.... Sure I don’t even know her but telling people simply work harder and don’t complain after everybody knows that she started from a totally different level than 99.9% of the rest of the population is actually a bit cheeky and she should know better than anyone else that it is not just hard work necessary for success.
> *



*

That reminds me of a favourite quote re wealth: "The only thing I like about rich people is their money" - Nancy Astor.

The other is: " While money can't buy happiness, it certainly lets you choose your own form of misery" - Groucho Marx.*


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## tech/a (9 December 2012)

With the 2 keys firmly in place 
(1) recognising and taking opportunity
(2) risk mitigation

Time for the 3rd and possibly the most important element for those who are looking to acquire* REAL* wealth.

*ALL OR NOTHING*

Let me first define nothing----very little or No loss and no profit.

If you dont put all your eggs in the one opportunity you wont create real life changing wealth.

Have a read of Darvas.
"How I made 2 million"
In an era where 2 million was like $50 million today.


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## ROE (9 December 2012)

tech/a said:


> I'm with ROE.
> 
> But to ge t in a position where you have
> Enough asset to generate passive income of
> ...




Not really ... everyone can do it just the length of time it takes most people either dont stick to it
or abandon for something in scheme of get rich quick...

I always has a job, I always stack away part of my pay and invest, I haven't taken any extreme risk
apart from what I think is a reasonable investment.....the higher pay job I get, the more I stack away,
most people get decent pay rise in their life time so if you stack 20% of your pay away, it can easily be done..

my passive income wont come in 5 years or 10 years but 20-25 years which is 5-10 years before my retirement age you can generate substantial passive income that pay for your life style till the rest of your day....

if you stack away part of your pay regularly and invest catching the boom just automatically fall into it...

Most people dont need to make 20m or 50m to be wealthy, just live a simple life with a splash ever so often doesn't cost
a lot of money and if they can do it under their passive income it's the life to be envy...


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## craft (9 December 2012)

DocK said:


> That reminds me of a favourite quote re wealth:





"I’m not wealthy, because I have everything I want but because I want everything I have."
??

Deep, but gets to the essence of what wealth really is.


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## Julia (9 December 2012)

YMI said:


> It may not be clearly understandable from my poor articulation, I don’t care about her body shape, what I wrote is more what I think of her character. Sure I don’t even know her but telling people simply work harder and don’t complain after everybody knows that she started from a totally different level than 99.9% of the rest of the population is actually a bit cheeky and she should know better than anyone else that it is not just hard work necessary for success.



As far as I know, she has never denied her privileged start.  Plenty of people have also had inherited affluence and have p****d it up against a wall.
I don't think her advice to people wanting to be successful to work hard, save and invest, rather than spending frivolously is any the less reasonable because it comes from her.


> Nevertheless I should have left this bit out of my post, didn’t know she’s a friend of yours



As you would probably imagine, I've never met her.  I'm just sick of people slagging off at her on the basis of her appearance.  The world of mining is probably one of the toughest, and she has succeeded there when many women would quail at the thought.

Clive Palmer is extremely wealthy.  He is also hardly one of the world's most physically attractive people.
He's also a greater media tart than Peter Beattie was.  But no one slings off at his obesity or attention seeking behaviour. 



> Again, I thought it’s easy understandable but because of my bad articulation probably not. It is like without light no darkness – this is easy to understand – or without sound no silence. I am not talking about anyone particular but in order to maintain their wealth well-heeled people are interested in a financial gap between poor and rich - easy.



Imo you're perceiving something that, if it exists at all, certainly doesn't in any structured form.
In a country like Australia anyone can take advantage of the same opportunities.  The fact that many don't is probably more due to inherited attitudes, behaviour modelled by parents and general social environment, than any mechanism in our society that holds anyone back.

However, "money makes money" has already been mentioned.  So true.  And one instance of how this does negatively affect those without available capital is with the recent high numbers of people taking advantage of government subsidies to put solar panels on the roof, deriving lower electricity prices or even a profit in the process.  This is of course paid for across all consumers so that people without the means to install the panels are further disadvantaged when their bills increase to pay for the subsidy of this and other green schemes.  There will be other similar instances of such disadvantage, so in that sense I agree with you.



> Okay, there are lots of wonderful people who support less fortunate ones but very few would continue the support if they were on the same financial level or lower than the one they are helping.



Well, if they were on the same financial level, there wouldn't be any need for assistance.



> Here is an example; give everybody on earth evenly 1 million dollar. What could you actually buy with your million? A nice house? I don’t think so. A car? Perhaps a cheap one



You couldn't buy a decent house for $1M???  or a car???
That's pretty silly.



> – wealth and poverty wouldn’t exist anymore, no one would suffer from hunger just as no one could afford excessive luxury. Obviously some would save more, some would spend more and after some time the old order would be restored again.



Agreed in principle.  But that's essentially due to the attitudes and capabilities of those receiving that windfall.
You see it all the time in lottery winners.  Some invest wisely, but too often we hear about winners just spending it all then accessing government benefits.

It's a mindset rather than any social construct.



> *Why is wealth and poverty necessary to keep the system running?* I think it’s a psychological thing. We try to be better than others and accumulating wealth is a good way of proving that one is better. If everybody is forced to have the same, then there is no incentive for working harder or saving more. The idea of communism is a bit like that and we all know that it doesn’t really work. That is actually the main reason for the Euro crisis, some European countries work more efficiently than others and therefore can sell their products more competitive than others. Before they adjusted the lower efficiency by higher inflation in certain countries, but now they have the same currency and that could eventually lead to the fail of the system if they can’t find a solution. What are the options? They can make these countries intentionally poorer by reducing their wages – then they risk a national uprising. They could also raise the wages in the more efficient countries – then they lose competitiveness compared to the rest of the world.



Again, it's largely a case imo of some countries (just like some individuals) being thoughtful and efficient with managing their finances.



> And I also believe that rich people try to keep others down in order to retain or further increase their wealth.



In business, yes, of course you're going to work to do better than your competitors.  We all benefit from healthy competition.
I don't see that also applying to most individuals, only perhaps some who are emotionally insecure and regard money as some sort of comparative status symbol rather than a means to ensure personal security and capacity to make choices.


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## Mrmagoo (9 December 2012)

Bill M said:


> started a job as an apprentice.
> 
> " I got lucky ect ect.."





Most trades people are rich. They start earning young and are able to invest. Had you gone to university, like most people, you'd be poor.

Never met a poor tradesman, met lots of poor office workers.

The basis of building wealth is having a good job, with a good income, that allows you to build wealth to invest and then getting lucky. It is also the will power to save.

Some get that good job early, for others it can take till they're nearly 30.

Many of my com sci mates won't hit 100k until they're 30. A carpenter more often than not can be on $50 an hour at 24. Huge difference to wealth creation that makes.

One has 4 years of apprentice income, the other has 4 years of zero income due to university and 4 years of university debts (i.e hecs). One is on 100k at 30 (and DAMNED lucky to be so) the other is on 100k at 24 with a virtual guarantee.

If I had my time again I know what I'd pick...


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## Julia (9 December 2012)

burglar said:


> Question for Julia:
> 
> How much wealth is enough?



I won't be drawn on that, sorry burglar.  It's going to be different for every individual.
I'd probably describe 'enough' as being a carefully calculated amount, considering life expectancy, inflation expectancy, likely future spending - discretionary and non-discretionary - which allows an individual to take a fairly passive approach to the management of capital.  An amount which gives the individual a sense of security.
(And probably a huge sense of relief that the years of saving, investing and risk taking can be largely left behind.)



> You don't get wealthy by working for an hourly rate.
> That is income, not wealth!
> To acquire wealth you need to make the money work harder.



Yes, but you have to start somewhere.  Few of us have the advantage of being born into great wealth.
I've noticed amongst some people a pervasive attitude that they'll never be financially independent so it's just not worth trying.  It's always worth trying.



Bill M said:


> So in summary it was all hard work in ordinary jobs, then investing in real estate and stocks. I am Looking for investment  opportunities all the time, even now and there is plenty out there. It has all paid off and now I am retired and living off passive income from my investments. Some of my mates are still blowing their pay checks from week to week. Nothing is free, you alone have to make it happen. Good luck everyone.



Yep, agreed.  And sometimes we have to start all over again.  When I left my marriage at 33, I had no home, no job and no money.  Thankful just to escape with my life.  I'd been employed in the practice so that job was no more, and all I'd contributed financially had got caught up in massive debt run up by my husband totally against my protests.  I borrowed money from my mother for the bond and first two weeks' rent on a flat, got the first job I could see that paid decently, and went back to studying so I could ultimately earn more money.

Saved hard, no new clothes, no holidays etc until there was enough for a deposit on a very modest house, cheaper because it was on leasehold land.  Soon had that paid off, then into investment properties.

Was it easy?  No, absolutely not for some years.  But is it now worth it?  Yes, definitely.
I was only poor for a relatively short time, but oh how it sucks.  

Tech/A makes an excellent point about risk.  This is where some people come badly unstuck.
Borrowing to invest in carefully considered assets makes sense.  Borrowing, in fact double gearing by retirees mortgaging their homes, as offered by the Storm Financial 'strategy' does not.

I'd be interested in whether members consider parental influence and/or social environment made a strong contribution to their attitudes toward growing wealth.
For myself, it did.  I saw my parents work extremely hard.  They both gave up professional careers (accountant and music teacher) to go into 6 day/12 hour a day business.  They did make considerable money buying, improving and turning over these businesses, but it was really demanding stuff in terms of hours and physical effort.


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## Bill M (9 December 2012)

Mrmagoo said:


> Most trades people are rich.




Firstly magoo, you slipped the following into my quote and I don't appreciate you putting your own BS into my quotes without my permission.

*" I got lucky ect ect.."*

I never wrote that and I am starting to get the feeling that you hate people who have had a go in their life and have done well for themselves. How about sticking to the point and being more constructive in the future and refrain from Doctoring peoples posts.




> Most trades people are rich. They start earning young and are able to invest. Had you gone to university, like most people, you'd be poor.




Nonsense, most trades people I know are not wealthy. I have mechanics living next door to me and they are working 6 days week struggling to make ends meet.



> Never met a poor tradesman, met lots of poor office workers.




I have met many, some do not run businesses and do not work for themselves. There are plenty who work for bosses in factories, workshops or Government run enterprises on very ordinary $$ per hour.



> The basis of building wealth is having a good job, with a good income, that allows you to build wealth to invest and then getting lucky. It is also the will power to save.




Wealth is not having a good job with good income. Although I did an apprenticeship I ended up quitting that job 2 years after I got my trades certificate. I then took on ordinary low paid jobs that anybody off the street could have done. As ROE has already mentioned, it is not how much you earn that makes the difference it is how much you save. Then when you have saved you make your investments, it has nothing to do with luck.


> Many of my com sci mates won't hit 100k until they're 30. A carpenter more often than not can be on $50 an hour at 24. Huge difference to wealth creation that makes.




Nonsense again, I guess if you are running a business and working for yourself then perhaps that carpenter may need to charge $50 p/h. However the great majority of Carpenters on the tools working for somebody would more than likely be getting under $20 p/h. Check it out here if you don't believe me.
http://www.fairwork.gov.au/2007payscalesummaries/AN120089.pdf



> If I had my time again I know what I'd pick...



I reckon if you picked the other way you would still come on this forum repeatedly using the words "lucky" and whining about other peoples achievements. Tell me, if you saw your local Dentist driving a brand new 200K BMW would he be "lucky" too? Or do you think that all those years of University, training and hard work had nothing to do with it? 

It's all about spending less than you earn and then investing what you have saved wisely. Then your money will make money and you will accumulate wealth.


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## Mrmagoo (9 December 2012)

Bill M said:


> Firstly magoo, you slipped the following into my quote and I don't appreciate you putting your own BS into my quotes without my permission.
> 
> *" I got lucky ect ect.."*
> 
> ...




To address your points.

1) Have a cry I was paraphrasing and summing up your "story". Which is nothing remarkable. You had money and invested it at the right time.

2) You're quoting award wages. Most carpenters do get about $50 an hour all considered.

3) Not going to indulge in your little episode of self gratification the tired old I did it therefore everyone must be the same as me so they can do it to and if they didn't then they're just crap is tired and over done. That is fine talk for down the pub with your rich old tradesman mates and in fact I encourage that kind of thing as it boosts confidence but it does not qualify as advice. The problem is when you start to use that level of personal arrogance (personal arrogance is good imo) to reflect negativity onto others and what they struggled to achieve in their lives.

4) If you have any actual investment tips I'd love to hear them.

5) It is not how much you make, the more you earn the more you spend but you need to have a decent income to have the opportunity to invest. People these days really struggle to make ends meet and I'm old enough to know that times now are different to what they used to be like. Most tradespeople around my age have done *very *well. Not to take away from their achievement but that is just the way things turned out. 

6)   Many people work their ass off in the blue collar job and end up with basically nothing. To suggest that people like that are "whingers" who don't work hard is just a load of crap. It is a matter of being in the right place at the right time for so many different things in life. You said it yourself with the mechanic example, interchange that with plumber or electrician and I'd love to hear that story played on a violin. I've also got mates who are ridiculously intelligent, went into engineering and software engineering who contribute massively to society who ended up with nothing. They're mid to late 20s on about 80k a year for all their hard work have basically nothing or enough for maybe a 15% deposit on a house. All of us just missed out on the housing boom where had this been happening 10 years ago, most would have bought a house plus investment properties and would have made profits. I have another mate who has bought a house with his wife, owns two investment properties and for all his work *HAS LOST MONEY*, he did the same as you and is losing money. Had this been ten years ago, in the 4 years since he purchased he'd be nearing double his money and would be on a forum bragging about it. TIMING DOES MATTER.  

7) You don't know what kind of personal tragedies may have befallen a person preventing them from investing or what other needs affected their lives. Illness and injury can lead to unemployment or bankruptcy.  Caring for a sick parent or sibling ? Cost of medical bills ? There is no distinct formula for generating wealth other than earning significantly more than you need to live (a well paying job) and the discipline to save and the LUCK to invest AT THE RIGHT TIME.

8) A dentist is basically a licensed thief.


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## tech/a (9 December 2012)

Geez Magoo
You type some rubbish.


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## So_Cynical (9 December 2012)

Mrmagoo said:


> 8) A dentist is basically a licensed thief.




Yep i whole heartedly agree on this point...im going to see a specialist doctor on Tuesday, 10 or 15 minutes for $200 bucks...also licensed thief IMO.


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## MrBurns (9 December 2012)

Salary doesn't make you wealthy in itself it's when your earnings are high enough that you can use them to invest in real estate or whatever else you may lean toward THAT'S where the
wealth is created
Having said that if you're happy with what you've got you're a wealthy person.


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## TMC93 (9 December 2012)

The fact that you think every qualified tradesmen is well off is a clear indication you don't know many tradesmen. Yes there are wealthy trades, I know a few who I would classify as very well off, but they didn't make they're money necessarily doing their trade, they made money by running a business. I remember one of them telling me the only time I made any money was when I got my head out of the tool box and into the office. Once you take off tools, insurance, vehicles, etc etc they don't make a killing. 

I think the same probably applies to a dentist, they have all of their expenses and plus years of uni debt, I agree they charge a swag of money for a short time but its not as if they don't work hard.


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## DocK (9 December 2012)

tech/a said:


> Geez Magoo
> You type some rubbish.



+1

Magoo, maybe you should have a chat to a few tradies on the Gold Coast - they sure would love to know where they could get consistent work for $50/hr, not to mention having to provide their own super, annual leave, sick pay etc.  I know quite a few that get good money when they have work - but then get no pay when they have no work or can't work due to weather etc.  I also know quite a few 30 year olds who'd love to be on anywhere near $80k yet have still managed to live within their means and save a deposit on a modest home to start with.  Maybe they spend less time complaining that the good times have passed them by and just get on with it!

Your posts read like a litany of poor me, it's not fair!  Anyone doing better than you is evil, employers are evil, professionals are thieves etc.  Get a grip!  Or maybe just grow up.


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## Bill M (9 December 2012)

Mrmagoo said:


> 8) A dentist is basically a licensed thief.




With that comment I have nothing further to add to your ridiculous posts.



tech/a said:


> Geez Magoo
> You type some rubbish.




You're not joking.


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## Bill M (9 December 2012)

tech/a said:


> Mitigation of risk is one of the most important investment topics there is.
> I could---but wont prattle on infinitum
> While identification of opportunity can be honed as a skill set------ the mitigation rather than the avoidance of risk needs to follow right behind the decisive action upon finding an opportunity.
> 
> ...




Good point tech/a, this is where I went wrong in 2007, lost a lot in the crash. It's a bit like that other thread, buying good investments is the easy part, knowing when to sell is the hard part. It is something I need to work on.



Julia said:


> I'd be interested in whether members consider parental influence and/or social environment made a strong contribution to their attitudes toward growing wealth.
> For myself, it did.  I saw my parents work extremely hard.  They both gave up professional careers (accountant and music teacher) to go into 6 day/12 hour a day business.  They did make considerable money buying, improving and turning over these businesses, but it was really demanding stuff in terms of hours and physical effort.




My parents were a bit like Docks and her husbands. They worked hard and worked towards paying off the house, any investments in stocks or investment property was a real no no. But they did teach me to always put aside a portion of my pay each week and I took that advice on board. The rest I had to learn for myself, I was not content with just having my own home and a term deposit. Retirement costs a lot more money than that.


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## Mrmagoo (9 December 2012)

DocK said:


> +1
> 
> Magoo, maybe you should have a chat to a few tradies on the Gold Coast - they sure would love to know where they could get consistent work for $50/hr, not to mention having to provide their own super, annual leave, sick pay etc.  I know quite a few that get good money when they have work - but then get no pay when they have no work or can't work due to weather etc.  *I also know quite a few 30 year olds who'd love to be on anywhere near $80k* yet have still managed to live within their means and save a deposit on a modest home to start with.  Maybe they spend less time complaining that the good times have passed them by and just get on with it!
> 
> Your posts read like a litany of poor me, it's not fair!  Anyone doing better than you is evil, employers are evil, professionals are thieves etc.  Get a grip!  Or maybe just grow up.




Or maybe timing matters. Anyway I agree. No point discussing this with people who clearly do not understand anything beyond their own egos.

Also 80k is peanuts, if they've bought a house on less than that, it was because of timing, that is they bought them when they were all 100-200k cheaper.


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## tech/a (9 December 2012)

Mrmagoo said:


> No point discussing this with people who clearly do not understand anything beyond their own egos.
> .




Well perhaps not everything!


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## burglar (9 December 2012)

Mrmagoo said:


> ...
> 8) A dentist is basically a licensed thief.






Mrmagoo said:


> ...
> One has 4 years of apprentice income, the other has 4 years of zero income due to university and 4 years of university debts (i.e hecs). ...




A strange contradiction!


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## Julia (9 December 2012)

tech/a said:


> Geez Magoo
> You type some rubbish.



+100/



So_Cynical said:


> Yep i whole heartedly agree on this point...im going to see a specialist doctor on Tuesday, 10 or 15 minutes for $200 bucks...also licensed thief IMO.



Rubbish.  Perhaps you'd like to consider the years of study before qualifying as basic dentist, then probably a further six years to acquire a specialist qualification.
Considering their expertise at that stage, I'd happily pay more than $200 for a consultation which could result in e.g. avoidance of significant periodontal disease.




DocK said:


> +1
> 
> Magoo, maybe you should have a chat to a few tradies on the Gold Coast - they sure would love to know where they could get consistent work for $50/hr, not to mention having to provide their own super, annual leave, sick pay etc.  I know quite a few that get good money when they have work - but then get no pay when they have no work or can't work due to weather etc.  I also know quite a few 30 year olds who'd love to be on anywhere near $80k yet have still managed to live within their means and save a deposit on a modest home to start with.  Maybe they spend less time complaining that the good times have passed them by and just get on with it!
> 
> Your posts read like a litany of poor me, it's not fair!  Anyone doing better than you is evil, employers are evil, professionals are thieves etc.  Get a grip!  Or maybe just grow up.



+ a heap.  Magoo, you do nothing on this forum except whine about how everyone other than you gets a go in life.  If you spent a bit less time whining and a bit more seeking opportunities for creating wealth you'd do yourself and all of us a big favour.


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## Smurf1976 (10 December 2012)

TMC93 said:


> The fact that you think every qualified tradesmen is well off is a clear indication you don't know many tradesmen. Yes there are wealthy trades, I know a few who I would classify as very well off, but they didn't make they're money necessarily doing their trade, they made money by running a business. I remember one of them telling me the only time I made any money was when I got my head out of the tool box and into the office. Once you take off tools, insurance, vehicles, etc etc they don't make a killing.



Well I'm a tradie (electrician) and in the past I have indeed earned big money working for an employer.

Sounds good? Try doing 84 hour weeks for an extended period whilst still being "on call" (and actually called out quite often) after hours. Try working outdoors with frost on the ground or in the rain too. The term "living to work" comes to mind. 

Yes, there's big money there if you're prepared to get it but there's a definite downside to it. Hence you'll find that most tradies either move on to something else, or end up working somewhere that has "normal" working hours and which isn't based in the middle of nowhere. Those jobs don't pay the big money however.

Find 10 tradies earning big money on the tools. Now find how many of those are over 35? Very few and there's a reason for that - it's not something that the average person could sustain, especially not if there's a partner and kids involved. Most are over it by their early 30's.

All that said, my observation is that income has a very loose relationship to financial success. Assuming the person has some sort of full time job, the rest comes down to how they manage their money. I know people who earn $100K a year who are effectively broke with nothing to show for their efforts. I know others who earn $60K and who are in a far better situation simply because they avoid spending on things which are poor value.


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## sydboy007 (10 December 2012)

I was reading an article recently that showed high income and high net wealth and the 2 categories had little overlap.

As they say wealth wasn't built in a day.  If you can follow Warren Buffets lifestyle - modest house, off the rack suits, standard model car, then I think you're well on the way to being able to create wealth because you will have excess funds to invest.

I would say buying high quality companies paying reliable dividend streams will get you on your way too.

Just really annoying the corporate bond scene in Australia is so limited, and most of the bond managed funds out there are a rip off in their of their MER.

In many ways building wealth is like getting fit.  There's plenty of flashy blurbs out there that promise you results with little effort, but the reality is it's generally a long hard slog.

Remember, capital preservation is more important than the chase for growth!


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## tech/a (10 December 2012)

> *Remember, capital preservation is more important than the chase for growth!*




There are some terrible examples of mis managed funds on this site.
PEN/RED To name just a couple.


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## Miss Hale (10 December 2012)

Basically for me it boils down to simply spending less than you earn.  If yo can manage to do this no matter what your income then you will acquire wealth pretty much automatically.


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## cynic (10 December 2012)

Miss Hale said:


> Basically for me it boils down to simply spending less than you earn.  If yo can manage to do this no matter what your income then you will acquire wealth pretty much automatically.




+1

I've often encountered people whom insist that their income is never sufficient to accommodate a savings regime, and yet somehow, these same people always seem to be able to afford life's necessities - designer fashions, the latest gizmos, entertainment etc. When the mere suggestion of a 2km stroll to a person claiming to be unable to afford a rail fare is met with an expression of abject horror, I cannot help but wonder whether those claiming a lack of income have any appreciation of the true meaning of poverty!


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## Julia (10 December 2012)

Miss Hale said:


> Basically for me it boils down to simply spending less than you earn.  If yo can manage to do this no matter what your income then you will acquire wealth pretty much automatically.



Can you define what 'wealth' means when you say this?
Your definition could comprise someone earning $40K p.a. who only spends $35K p.a.  Even over a lifetime it's pretty hard to envisage that saving per annum creating real wealth.


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## Calliope (10 December 2012)

Julia said:


> Can you define what 'wealth' means when you say this?
> Your definition could comprise someone earning $40K p.a. who only spends $35K p.a.  Even over a lifetime it's pretty hard to envisage that saving per annum creating real wealth.




Obviously Miss Hale is a disciple of Mr Micawber. My definition of wealth, and i suspect hers is too, is;

 "A tangible or intangible thing that makes a person, family, or group better off."


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## Smurf1976 (11 December 2012)

cynic said:


> +1
> 
> I've often encountered people whom insist that their income is never sufficient to accommodate a savings regime, and yet somehow, these same people always seem to be able to afford life's necessities - designer fashions, the latest gizmos, entertainment etc. When the mere suggestion of a 2km stroll to a person claiming to be unable to afford a rail fare is met with an expression of abject horror, I cannot help but wonder whether those claiming a lack of income have any appreciation of the true meaning of poverty!



I used to quite literally walk 8km from the bus stop to home when I was doing night school (TAFE) many years ago. A car was out of the question financially, and buses didn't run further at that time of night. 

Having grown up in an environment where money was extremely limited is the main driver of never wanting to be in that situation again. I have always been careful with spending as a result - not to the point of being obsessive, but I'm just not going to pay for things that are poor value.


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## YMI (11 December 2012)

Miss Hale said:


> Basically for me it boils down to simply spending less than you earn.  If yo can manage to do this no matter what your income then you will acquire wealth pretty much automatically.





Julia said:


> Can you define what 'wealth' means when you say this?
> Your definition could comprise someone earning $40K p.a. who only spends $35K p.a.  Even over a lifetime it's pretty hard to envisage that saving per annum creating real wealth.



Sorry to interfere, I think Miss Hale actually wrote her definition there. Wealth is defined by each individual differently. While some may feel wealthy and contented on a level that allows them to pay the bills and live comfortably without financial fears others may not even classify $1billion as excessive wealth. There is no number attached to the definition.

What is your definition Julia?


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## tech/a (11 December 2012)

I've noticed those without wealth and those without prospects of achieving any real wealth
Have a far lower or different definition of wealth than those who have achieved wealth that
Is appreciable.( financial independence ).


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## Julia (11 December 2012)

YMI said:


> Sorry to interfere, I think Miss Hale actually wrote her definition there. Wealth is defined by each individual differently. While some may feel wealthy and contented on a level that allows them to pay the bills and live comfortably without financial fears others may not even classify $1billion as excessive wealth. There is no number attached to the definition.
> 
> What is your definition Julia?



Several posts ago I summed up my attitude here:


> I won't be drawn on that, sorry burglar. It's going to be different for every individual.
> I'd probably describe 'enough' as being a carefully calculated amount, considering life expectancy, inflation expectancy, likely future spending - discretionary and non-discretionary - which allows an individual to take a fairly passive approach to the management of capital. An amount which gives the individual a sense of security.
> (And probably a huge sense of relief that the years of saving, investing and risk taking can be largely left behind.)




So for me 'enough' may not be wealth in someone else's terms as I've suggested in my response to burglar, and I'd never consider myself wealthy but I have no aspirations toward money for its own sake, just what is needed to provide a sense of security and the capacity to make choices.  Oh, and the relief of knowing you need never work for an employer ever again.


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## MrBurns (11 December 2012)

I had a considerable amount of money at one stage, I'll never forget walking into the Mercedes showroom, pointing and saying "I'll have that one" or saying to the bank, "No I dont want you to keep the mortgage on the house in case I want to borrow again" Owing nothing, buying cars for my kids, travel overseas buying a property for a relative to live in to be closer to us and on it goes.

Divorce took care of a large part of it, I'm still ok but cant splurge like I'd like to any more.

That was a great sense of freedom and utter joy I can tell you.

Wealth really depends on the indivisual but most would consider wealth to be enough money to do and buy what you want without worrying about the cost.


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## white_goodman (11 December 2012)

MrBurns said:


> I had a considerable amount of money at one stage, I'll never forget walking into the Mercedes showroom, pointing and saying "I'll have that one" or saying to the bank, "No I dont want you to keep the mortgage on the house in case I want to borrow again" Owing nothing, buying cars for my kids, travel overseas buying a property for a relative to live in to be closer to us and on it goes.
> 
> Divorce took care of a large part of it, I'm still ok but cant splurge like I'd like to any more.
> 
> ...




wealth to me is living comfortably for little to no work not so much spending willy nilly, and removing the risk of losing capital ie thankyou for confirming not to get married

*comfortable is two holidays a year with good amounts of drinking/eating weekly = 2.5k a week spending money in todays dollars


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## prawn_86 (11 December 2012)

white_goodman said:


> *comfortable is two holidays a year with good amounts of drinking/eating weekly = 2.5k a week spending money in todays dollars




Does that spending money include the holidays or are they on top?

For me to be completely comfortable (not filthy rich), outside of rent/house already paid off, i would probably want:
1k pw spending
1k pw holidays (50k pa)


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## white_goodman (11 December 2012)

prawn_86 said:


> Does that spending money include the holidays or are they on top?
> 
> For me to be completely comfortable (not filthy rich), outside of rent/house already paid off, i would probably want:
> 1k pw spending
> 1k pw holidays (50k pa)




holidays on top, though holidays arent that expensive

problem is when you reach goals you tend to get bored/complacent and need to set a higher one, so the 2.5k a week thing then relax might be a pipedream

http://www.amazon.com/Rush-Why-Need-Love-Race/dp/B007K4FSJW/


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## burglar (11 December 2012)

Julia said:


> Oh, and the relief of knowing you need never work for an employer ever again.




You have won me over!!


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## Miss Hale (11 December 2012)

Julia said:


> Can you define what 'wealth' means when you say this?
> Your definition could comprise someone earning $40K p.a. who only spends $35K p.a.  Even over a lifetime it's pretty hard to envisage that saving per annum creating real wealth.




It's just as I said, wealth is spending less than you earn, this way you are always ahead. As Calliope quite rightly said, I subsribe to Mr Micawber's theories  (especially the one he outlined previously about expenses being less than earnings). I've read many books on making money and they all boil down to this same basic principle. 

As an aside I wouldn't underestimate what $5,000 a year from an early age over a lifetime would amount to bearing in mind the wondors of compound interest and the fact that with inflation your earnings and savings capacity would rise. 

The key is to not spend the money you save (and subsequently invest of course), much easier said than done when 'things' tempt us. 

As an example, I had an elderly relative who passed away a little over a year ago.  To all intents and purposes she was a little old lady living a fairly simple but comfortable lifestyle as a self-funded retiree.  In actual fact she had accumulated several millions in investments  The money she earned was far more than she needed to live on so even in retirement she was building more wealth.  She had a very modest job when she worked and had travelled extensively in her youth but she clearly saved and invested all through her life. She never married though, maybe that is the key


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## Julia (11 December 2012)

Miss Hale said:


> It's just as I said, wealth is spending less than you earn, this way you are always ahead. As Calliope quite rightly said, I subsribe to Mr Micawber's theories  (especially the one he outlined previously about expenses being less than earnings). I've read many books on making money and they all boil down to this same basic principle.



OK, agree of course.  I thought that pretty much went without saying.



> As an example, I had an elderly relative who passed away a little over a year ago.  To all intents and purposes she was a little old lady living a fairly simple but comfortable lifestyle as a self-funded retiree.  In actual fact she had accumulated several millions in investments  The money she earned was far more than she needed to live on so even in retirement she was building more wealth.  She had a very modest job when she worked and had travelled extensively in her youth but she clearly saved and invested all through her life. She never married though, maybe that is the key



The key to her wealth was her successful investing, it would seem, rather than just simply saving what she didn't spend.
I like the observation about her not being married.   I only succeeded in doing OK after I was no longer encumbered by extravagant husbands.


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## Miss Hale (11 December 2012)

Julia said:


> The key to her wealth was her successful investing, it would seem, rather than just simply saving what she didn't spend.




Well yes and no.  I think the key is saving it and not spending it once you have saved it.  Even if you just put it in the bank you'd be way ahead of most people.  My relative was a pretty conservative investor actually, mainly blue chip shares with good earnings and term deposits and the like. The key is to invest it in something with not too high a risk and not blow it which is always the temptation (be it on holidays, cars, expensive home, other consumer goods or some hair brained scheme/dodgy 'investment').  Of course this is a pretty boring approach (way too boring for some) but it gave her what she wanted; financial security. 



> I like the observation about her not being married.   I only succeeded in doing OK after I was no longer encumbered by extravagant husbands.




I'm still encumbered by mine  Suffice to say we have different approaches to money management   Interesting that both men and women feel they are disadvantaged financially by marriage.


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## MrBurns (11 December 2012)

Julia said:


> I like the observation about her not being married.   I only succeeded in doing OK after I was no longer encumbered by extravagant husbands.




Don't speak too soon you never know whats round the corner:


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## Julia (11 December 2012)

MrBurns said:


> Don't speak too soon you never know whats round the corner:



 I don't think so, Mr Burns.


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## MrBurns (11 December 2012)

Julia said:


> I don't think so, Mr Burns.




Ahhh Julia you just broke a thousand hearts...........


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## YMI (11 December 2012)

Julia said:


> So for me 'enough' may not be wealth in someone else's terms as I've suggested in my response to burglar, and I'd never consider myself wealthy but I have no aspirations toward money for its own sake, just what is needed to provide a sense of security and the capacity to make choices.  Oh, and the relief of knowing you need never work for an employer ever again.



Pretty good answer. If I had to give it a figure I think $100k per year safely to spend after tax and I would consider myself wealthy but I would never tell anyone – don’t want to be called snob. Work is not the biggest issue, without any work life would be too boring I guess.
Maybe 10 million a year and I would consider myself excessively wealthy. I mean, I couldn’t even in a dream spend 10 mill. for living each year. Sure it could be used to accelerate further accumulation or for the chance to support people who need it but I couldn’t use it for myself.


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