# Why do you build wealth? What's your end goal?



## ENP (6 April 2011)

Most books and other info on wealth say picture your end goal first, then do a plan backwards to figure out where and when to invest.

What are everyones end goals? 

Do you even have to have one? Can't one just enjoy making money from investments?


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## tech/a (6 April 2011)

Since the day myself and brand new wife sat down 34 years ago and worked out our budget and we had $5 to spend on ourselves---my goal has been to live without the restraints of financial burden---the ability to do what I want when I want without having to watch the $$.

Work for myself
Travel when I want--where I want
Eat out when ever I want where ever I want.
Have private medical
Have the ability to open doors for my family which could be restricted due to financial incapacity.
Spoil my wife!
Spoil myself!
Have the ability to be recklessly spontaneous if I wish.
Enjoy the ability to help those that I choose---even in the smallest of ways.
Live life to the fullest and have NO regrets.


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## VSntchr (6 April 2011)

tech/a said:


> Since the day myself and brand new wife sat down 34 years ago and worked out our budget and we had $5 to spend on ourselves---my goal has been to live without the restraints of financial burden---the ability to do what I want when I want without having to watch the $$.
> 
> Work for myself
> Travel when I want--where I want
> ...




^ what that guy said


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## wayneL (6 April 2011)

In the end we're all dust.

My end goal is to enjoy the journey.


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## Julia (6 April 2011)

ENP said:


> Most books and other info on wealth say picture your end goal first, then do a plan backwards to figure out where and when to invest.
> 
> What are everyones end goals?
> 
> Do you even have to have one? Can't one just enjoy making money from investments?



Yes, of course you can.  But most of us need to have the sense of a purpose for our existence and need targets to provide an incentive to invest profitably and save.

If you were to ask this same question of the general public, rather than on this stock forum where obviously people are investment and profit minded, I suspect you would meet with many blank looks.
The understanding of the need to take responsibility for one's own outcomes financially is not widely appreciated.
Financial independence brings you the capacity to choose.  

Tech has listed many of the reasons that represent our aims.
I'd add to this the sense of security that comes with owning your own home, and preferably a few investment properties as well, plus additional capital which can be deployed into shares when appropriate.

Far too many people get to retirement with inadequate provision for looking after themselves and become dependent on the miserable age pension.

This is something you won't think about while you're young but I reckon it's something that will become more and more important as the quality of care when old will be dependent on how much you can pay.


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## tech/a (6 April 2011)

> My end goal is to enjoy the journey.




All you can ask really $$s or not.


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## Reasons (6 April 2011)

ENP said:


> Most books and other info on wealth say picture your end goal first, then do a plan backwards to figure out where and when to invest.




They tell you that logically because it is assumed people have targets in mind (or will eventually); such as pay off your debts, pay off your home, prepare for retirement, etc.



ENP said:


> What are everyones end goals?




As I have now met my initial wealth goals, a brief history of what they were and how it happened might help your understanding and hopefully not send you to sleep before finishing. 

I really had 2 main wealth goals very early in life; to get rid of bad debt and to be financially independent at 55 and later added a 3rd goal to have a 2 year buffer of cash should something go wrong.

As I never consider my PPOR to be an asset, my goal was to get rid of that 'bad' debt initially. I went to uni late compared to most and used my accumulated Super to pay off my house so I had no debt whilst at uni for 4 years. 

That achieved one goal, but meant I then had to rebuild my Super as well as build up the 2 year buffer so that became the concurrent last 2 wealth goals. 

20 years later of investing in conjunction with a partner with common goals and income and it is surprising what is possible if you rigidly stick to your goals. Much smarter to start earlier building Super like I did initially and I would rather have kept building it, but as I got rid of the PPOR debt early, it possibly worked out similarly in the end.

I did have to take out a loan for a few years for a slightly more up-market PPOR at one point, but got rid of that debt as quickly as I could. (an improptu goal?)

We never sent our kids to private schools even though we could have quite easily, but made sure we bought into an area where they had excellent state schools and that way kept our last 2 goals on target and our kids well educated for 'free'. (pay yourself first)

The end wealth goal has now been met and I am 55, and unbelievable as it might sound, still young enough to enjoy it. And we had fun along the journey as well.

Out of interest, we did eventually use some of the buffer cash and took the family overseas twice for a couple of months at a time once they were old enough to appreciate it, and we were fairly confident about the timing of the depletion of some of the capital saved. I am coaching them a fair bit about achieving their own wealth goals and as they are all at uni, we are using the remaining buffer cash to pay their HECs fees so they don't start life with debt. The rest is up to them (with some re-education occassionally no doubt). 

And now I have a new wealth goal; to keep what we have and to grow it, whilst enjoying the benefits of the passive income as much as we can; and as much as you love them, happily mostly minus the kids!



ENP said:


> Do you even have to have one? Can't one just enjoy making money from investments?




So, you certainly can do it randomly or for enjoyment, it just depends if you really don't want to have specific wealth goals, or, don't yet realise that you do want them and possibly even need them.


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## ENP (7 April 2011)

My end goals are pretty basic.

- Have a moderate home in a moderate suburb that is warm and dry.
- Have a beach house within walking distance of the beach.
- Be able to work 4 days a week instead of 5.
- Go on one overseas holiday a year, it may be for a week or for a month. 

I don't think I'd quit working. I actually get quite bored if I take time off and stay round home. I always have to be doing something.


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## medicowallet (7 April 2011)

Security and comfort for myself, wife and children.

Giving my children every opportunity which they require to achieve a safe and comfortable lifestyle when I am dust.


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## burglar (7 April 2011)

Reasons said:


> ... We never sent our kids to private schools even though we could have quite easily, but made sure we bought into an area where they had excellent state schools and that way kept our last 2 goals on target and our kids well educated for 'free'. (pay yourself first) ...




There is a big apple pie in Canberra. We contribute the apples from our income! Politicians shovel the apples into the pie. Education in one slice, Social Security in another etc.
I don't want to read that our kids are well educated for 'free'.
I don't want to read that our kids are subsidising our pension.

I sent my apples to Canberra!


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## Reasons (7 April 2011)

burglar said:


> There is a big apple pie in Canberra. We contribute the apples from our income! Politicians shovel the apples into the pie. Education in one slice, Social Security in another etc. I don't want to read that our kids are well educated for 'free'.




It is as free an education as you are probably going to get under our present system of government and taxation, so no point paying for it twice through a private education provider is my logic.



burglar said:


> I don't want to read that our kids are subsidising our pension.




OK, but as the pension it is a social contract, just a promise to pay, but an unfunded liability that most of us are presently paying for through taxes (and increasing Govt debt) to support previous generations, I will leave it to your imagination who is next to step up. 

But of course there is the chance that our kids will be lucky and there will be too many BBs and the Govt. won't have the necessary funds to be able to honour the present pension social contract. 

That is something Gen Y will have fixed if they are smart as they will have had the opportunity to participate in Super all their lives. However, many BBs and those following who are financially unprepared would probably not like to read about the pension social contract being broken during their lifetimes is my bet.




burglar said:


> I sent my apples to Canberra!




So, simply put, considering you paid for it, and they went to all the trouble of making and delivering it whether you wanted them to or not, the choice was yours to partake, or not, in some of your pie.


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## Sdajii (7 April 2011)

Beer. Beer and hookers.


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## jimmyizgod (7 April 2011)

Sdajii said:


> Beer. Beer and hookers.




lol. someone knows how to party


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## Buckfont (7 April 2011)

When I was in primary school I used the watch the other kids at lunch time tuck into their hot meat pies, followed with a cream bun and a bag of lollies whilst looking at my warm vegemite sanga wrapped in greaseproof paper. 

It`s a simple reason to set your self up and it often comes from lack, and that lack teaches you to be smart when when you could be really stoopid, and blow it on all the useless incidentals.


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## moXJO (7 April 2011)

I was saving for a death star, but I keep hearing how property is going to crash. So I guess I will have to settle for beer atm.


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## trainspotter (7 April 2011)

Q) Why do you build wealth?
A) Coming from a dirt poor upbringing I craved for the finer things in life, so I guess I am compensating for all the things I perceived I missed out on. Also to provide my family with a head start in life in the way of not having to go through financial stress but at the same time teaching them the value of money.

Q) What is your end goal?
A) I believe I am pretty close to achieving it. How much is enough? More money brings greater responsibilities in the way of looking after staff, overheads, insurances, taxation implications, accountants etc ....... but I would like a boat with a helicopter pad on it.


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## medicowallet (10 April 2011)

trainspotter said:


> Q) Why do you build wealth?
> A) Coming from a dirt poor upbringing I craved for the finer things in life, so I guess I am compensating for all the things I perceived I missed out on. Also to provide my family with a head start in life in the way of not having to go through financial stress but at the same time teaching them the value of money.




Exactly.

the question for a lot is : Do you percieve things to be better now?

I think my life is, but many people say that they preferred simpler times, with no work on weekends, family barbecues, single person working, lots of kids to enjoy, quarter acre block and so on..... you know the things most gave up for what?  - 1 hour drive to and from work 8-6 job, small yard, 1-2 kids, high stress levels, and 3 plasma tvs.


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## luap77 (10 April 2011)

"...but many people say that they preferred simpler times, with no work on weekends, family barbecues, single person working, lots of kids to enjoy, quarter acre block and so on....."

Yes, I'm one of those. Things have moved on from here in many aspects, and this isn't really an option that works for the majority of people. What's killed it (in my case) is a lack of job security, which is why I try to build wealth as a buffer for lean times when I'm between jobs. IMHO, if you give a person solid job security (wherever it is actually possible to do so) and realistic expectations without distractions (so that they have the opportunity to remain focused on their job) then the person will generally be very productive despite appearing to work more slowly/be working on fewer tasks and spend less time at work. Of course this can be abused, but the system IMO should come down hard on wrongdoers and not seek to try and control everybody by applying all sorts of administrative drags on people just trying to do their job, or anything else for that matter. 

Well, a bit of a rant there


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## awg (10 April 2011)

trainspotter said:


> but I would like a boat with a helicopter pad on it.






Sdajii said:


> Beer. Beer and hookers.




A very wealthy man stated to me "if it flies, floats or f#$%s  ,then hire it"

By this he meant it was ultimately less expensive

( He broke his recommendations though)


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## Bill M (10 April 2011)

ENP said:


> What are everyones end goals?




For my wife and I we need enough money to last us until we pass out of this world at the average age of 85. To do that and being retired early you need a lot of money, the more the better. I am still taking risks with investments to maximise that end figure and once I get there I won't be worrying about money as it will be an allocated pension hands off and mostly in cash and fixed interest. In short the end goal is total financial security in order to do what we want when we want without too much risk/worry.


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## tech/a (10 April 2011)

> and once I get there I won't be worrying about money




Interested in where "there" is and when it is--relative to time to 85.
What in $$ terms "there" is also.


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## kingcarmleo (10 April 2011)

To own my own company and travel the world doing deals


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## tothemax6 (10 April 2011)

Why? Better than not.
End goal? No end, just a direction.


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## sptrawler (10 April 2011)

Wealth or money only gives you more options. It doesn't necassarily make you happy or even contented. It just gives you the option to do things that may cost more than someone else can afford. However just because you payed for something doesn't mean there is more enjoyment.
What better enjoyment than just sitting with your partner or a couple of friends and enjoying a nice red and a cheese platter together. Or sitting with you brother or sister maybe your son, daughter or grandchildren and doing a bit of fishing on a lovely sunny day.
If you have enough to put a roof over your head, food on the table and do the above and you have your health. You are indeed a wealthy person.
Sometimes we just need to sit, reflect and smell the roses.
Now where the hell is that red.


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## awg (10 April 2011)

tech/a said:


> Interested in where "there" is and when it is--relative to time to 85.
> What in $$ terms "there" is also.




I have a preference to grow capital by above inflation and drawdown.

So if allow 3% for inflation and 4% drawdown, multiply expenses by that amount, and that gives a breakeven amount. 

I would prefer to leave at least 1% margin in return for safety.

So based on an 8% after-tax return, I can estimate how much capital is needed on a more conservative portfolio, so long as I can accurately forecast my current and future expenditure.

(Because we are not quite there yet, I seek a higher yield,
would like to be able to retire my partner & kids at uni r xpensive, so have been doing the calcs, getting close!) 

Capital should therefore continue to grow at above inflation. 

This also means a decent estate can be left to your heirs, or you can spend up on yourself or other projects later in life.

Alas, because of uncertainty, GFCs, greed, etc, one also feels that it is prudent to build an asset base that is well beyond what would be suggested in the above basic calculations, just in case the ar$e drops out of the financial systems again.

You also have to estimate on a best guess basis how long you gonna live


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## Smurf1976 (10 April 2011)

medicowallet said:


> Exactly.
> 
> the question for a lot is : Do you percieve things to be better now?
> 
> I think my life is, but many people say that they preferred simpler times, with no work on weekends, family barbecues, single person working, lots of kids to enjoy, quarter acre block and so on..... you know the things most gave up for what?  - 1 hour drive to and from work 8-6 job, small yard, 1-2 kids, high stress levels, and 3 plasma tvs.



Borrowing money they don't have, to buy things they can't afford, to impress people they don't like...

Personally, I like my 11 year old car that the insurance company values at $4700 and I don't want a new one. But I like knowing that I could pay cash for a brand new car straight from the showroom if I wanted to, even though I have no intention of doing so anytime soon.


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## Bill M (11 April 2011)

tech/a said:


> Interested in where "there" is and when it is--relative to time to 85.
> What in $$ terms "there" is also.




The "there" is when my wife finishes her part time work and we both hit age 55. We haven't completed our Super setup because most of our assets are outside it and need to live off them in the mean time but we are slowly moving them over now. The $$ terms are different for everyone so there isn't much point in commenting on that other than to say a passive income from low risk assets that increases with inflation for the rest of our lives, that is the end goal.


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## white_crane (11 April 2011)

I'd love to be able to big difference to many lives.




Sdajii said:


> Beer. Beer and hookers.




Or I could just go with this :alcohol: 



moXJO said:


> I was saving for a death star, but I keep hearing how property is going to crash. So I guess I will have to settle for beer atm.




Much to learn, you still have.


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## sptrawler (12 April 2011)

Just had a pertinent thought. 
Your end goal is probably to have enough money that even if you only have it earning bank interest it is enough.
If you only have enough that you need to pay someone to make more than bank interest, you don't have enough.


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## Reasons (13 April 2011)

sptrawler said:


> Just had a pertinent thought.
> Your end goal is probably to have enough money that even if you only have it earning bank interest it is enough.
> If you only have enough that you need to pay someone to make more than bank interest, you don't have enough.





Pretty much right; and to refine that thought slightly further, basing that amount on interest rates being low.


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## matty77 (13 April 2011)

enough money to live in the suburb I want to live in with a nice house.

more importantly enough money to give to my kids so they have the best opportunities in life. (but my retirement comes first!)


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## Reasons (13 April 2011)

matty77 said:


> ...more importantly enough money to give to my kids so they have the best opportunities in life. (but my retirement comes first!)




I think you have the right idea about your retirement coming first and once you attain that financial status, if you have done that well you then have the opportunity and resources to do useful things for your kids in considered ways that they can learn from. (I always considered it to be a bit like having to save yourself first before you can save others). If you have not done so already, it is really worthwhile reading 'The Millionaire Next Door'; by Stanley / Danko for their research perspective on kids and your money amongst other things.


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## Jhenry (13 April 2011)

I suppose this probably spawns from the old clichÃ© where " the love of money is the root of all evil." Well my desire for money is to have the best standard of life possible. To provide a comfortable life for my family and to ensure a comfortable retirement.


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## damien275x (18 May 2011)

So I dont have to work for any c*nt boss and can live on my own terms I'm not going to prostitute my way through 9-5 Mon-Fri til im 65 and basically dead. My parents wasted their lives, and no offence, but wasted their time with kids who are now ungrateful little pricks  who don't appreciate what they have and always want more LOL Stuff that. It's all or nothing, and I don't want to hear people telling me to stick my money in ING 6% interest, that's not how you get rich!

I like the rich guy at work who gave me the advice.. Look at what your parents did, then don't do it. Sure they were frugal, saved, were conservative, now all they have are some average cars, a home, and a pension. Cool, not what I want after wasting 50 years of my life thanks. They didnt even travel much either.


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## mazzatelli (18 May 2011)

My family were always in-the-money, but I contributed for my folks as a token of thanks for raising me and also for my little sibling.

Other than that, for my own freedom to experience life to the fullest. Material things only bring short lived joy....


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## Wysiwyg (18 May 2011)

The less financial wealth one has, the more other people determine your life outcomes. Eventually I want to drop all the monkeys off my back with complete financial self sufficiency thus experiencing what is important to me.


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## Caveman (20 May 2011)

Talking Why do you build wealth? What's your end goal? 
Because me Dad did.


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## Tyler Durden (21 May 2011)

damien275x said:


> I like the rich guy at work who gave me the advice.. Look at what your parents did, then don't do it. Sure they were frugal, saved, were conservative, now all they have are some average cars, a home, and a pension. Cool, not what I want after wasting 50 years of my life thanks. They didnt even travel much either.




They could be worse off.


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