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How much wealth is enough?

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tech/a said:
In reality most of the figures touted here will not be achieved by our members.
Off the 33000 members around 231 will become millionaires.
Of the approx 1000 active members posting 7 of us are or will be in that group.
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That's not even close to true. Check the ABS household wealth statistics. You shouldn't be comparing % of total population, you should be looking at age group data like ABS provides. There is a very considerable portion of Australians in the $1mill+ range in the peak 55-65yr old bracket... their average wealth is already above $1mill. Median is still a bit below but having more than 50% of Australians peaking above $1mill wealth in their old age isn't many years away now (although an ongoing poor property market and/or further reduction in inflation pressure could hold that back much longer).
 

50%
I'd like to see that stat!!,
You have a link to ABS household wealth stats?

Ah I see
Your quoting HOUSEHOLD nett wealth as in multiple occupants AND
The inclusion of the principal place of residence.

Mine is singular people principal place of residence Not included.
 
tech/a said:
...
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Fair enough that makes a big difference. My opinion is the measure should include any equity in an owner occupied house etc as well as super and dep. assets.. the whole lot minus all debts - this is generally how ABS stats refer to wealth and then this is often the source of data for news articles etc. I know the Aussie government ignores owner occupied home equity to some extent for pension and many other income/asset tests and the whole topic is clearly debatable (imo for what its worth is that this is just one of many emotionally driven short sighted flaws in our system that causes worse utilization of our resources & environment).

The document i referred to is here:
www.abs.gov.au
Type "wealth" in search bar should be enough... latest should be the first result (2009-10).
If not your looking for the "Household Wealth and Wealth Distribution" reports.

2009-10 is also roughly the recent peak in average aus property prices so I doubt it's risen all that much (or fallen) since then except it has since been recognized the wealth in private trusts in that report is grossly underestimated (you may remember news of them "finding" this money in trusts made it to mainstream media not very long ago).

There's also plenty of wealth allocation statistics across different age groups and different wealth groups in this report that you may find interesting.
 
I'd like to say something like "enough so I can stop working", but realistically, I think the more accurate answer would be, as I saw someone here once quote Kerry Packer, "just a little bit more".

For those who have ever gone to the casino, you'll see most people don't stop when they win $25, $50, $100, or even $1000. As an observer, you'd think that would be enough. But to them, they always want more. They want one more win, then one more, and one more after that.
 

Except that tech was quoting net investable assets. Most households have the overwhelming majority of their wealth tied up in their home.
 



Interesting. Is this a percentage of the entire population or a certain group of people (i.e. certain investors)?

If so, you'd think the percentage chances of people in this forum becoming millionaires is greater than the percentage of the overall population, as we are people specifically interested in investing and making money.

It would still be a very small percentage but not as small as that of the overall population.
 
McLovin said:
Except that tech was quoting net investable assets. Most households have the overwhelming majority of their wealth tied up in their home.
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I see this with many of my friends. The topic of retirement is around the BBQ--over the restaurant table--on the Golf course---or during training. The general rule of wealth creation (not mine) seems to be to own the house
retire with as much as you can --- supplement where possible and pick up part pension---when you run out sell the house down size---instant money. So yes your right. I saw somewhere that the average retirement super nest egg is below $80k. Woefully inadequate.


I would argue that the odds are no better.
1000s play golf few make a living and even fewer become millionaires.
 

Ed Zachery.

For the average person on an average wage, accumulating $1m in assets outside the home is not an easy achievement. A house was/is an easy one. You can gear at 2000% of equity and over the last 30 years they've been a long bull market.

Maybe I'm in the miniority because of my own circumstance, but I've never understood why you would want to squirrel away everything you have and live like a pauper until you retire. So many things can come up between someone and retirement (sickness/death etc) and you only live once. I'm not saying go out and spend 100% of what you earn, just live a normal life.
 

I would love to know a 5 - 10 year window of when i was going to die. That way i could plan accordingly
 
prawn_86 said:
I would love to know a 5 - 10 year window of when i was going to die. That way i could plan accordingly
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The answer to that one is pretty simple!

Live like you do! (Know when ish).
Unfortunately we need to live like we will be 100
but want to live like its our last month.
 

prawn_86 said:
I would love to know a 5 - 10 year window of when i was going to die. That way i could plan accordingly
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+1 My aunt (single & childless) is fond of saying she'd blow the lot at the casino if she knew when she was due to shuffle off this mortal coil.

There's a balancing act between putting aside enough to ensure a comfortable retirement and compromising your standard of life too much in order to do so. Knowing your life expectancy would make the decision sooo much easier, wouldn't it? I guess we all know people who have lived very frugally and done without so they could build up a nice nest egg only to die before they retire or very shortly afterwards. On the other hand there are plenty of examples of those that live like there's no tomorrow while they're young and repent while existing on the meagre age pension well into their 80's.

I think I err on the side of caution and am trying to ensure the spouse and I have enough to see us comfortable well into old age, but also consider that part of my present "wealth" is my family, particularly my children, and I don't want to die regretting that I had no time to spend with them as I was always working, or no great family holidays that we all remember for years to come. Likewise, I'd have more funds to invest for myself if I didn't send them to private school, or pay uni fees for them - but I consider the return on that investment to be worth more to me in the long run. Not all wealth can be measured in $ terms imo - not much point being a rich old lady who's lonely, bitter and full of regrets. Much better to be a rich old lady whose family still love her and has lived her life to the fullest The trick is in getting the living/saving/investing balance right, if one can't win lotto!
 
McLovin said:
Except that tech was quoting net investable assets. Most households have the overwhelming majority of their wealth tied up in their home.
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I think this changes as you get older. A retired couple or single with no children around no longer wants the big house. It only represents more maintenance and cleaning.

McLovin said:
Maybe I'm in the miniority because of my own circumstance, but I've never understood why you would want to squirrel away everything you have and live like a pauper until you retire.
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That's rather an extreme example. It's possible to be sensible about investing and saving without making life a pauper-like misery.
Everyone will have a different priority. I don't resent a single decision of saving/investing while I was working when I consider the immense relief I feel now at not being dependent financially on anyone other than myself.
So many things can come up between someone and retirement (sickness/death etc) and you only live once.
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Agree. However, for some a normal life is always being in debt. What I've noticed is a quite large number of people who simply give no thought to the need to plan for retirement. And then they get a helluva shock when they try to live on the age pension.

prawn_86 said:
I would love to know a 5 - 10 year window of when i was going to die. That way i could plan accordingly
Click to expand...
Prawn, the peculiar thing I've noticed is that what you think you will want to spend up on when you're dreaming about it, in fact can fade when the reality occurs. I used to think when I reached my target I'd celebrate by having a month in a five star hotel, in an exotic place, room service for every meal. When it became entirely possible, paradoxically I found I didn't really want to do it!

A friend has just been diagnosed with cancer. She has private insurance, of course, but there will be plenty to pay in the gaps. It won't be any problem as they're well off. This is the sort of thing most of us give little thought to when we're 25, but which is immensely important when you get older and the alternative is dying much earlier because you're hanging about on a public hospital waiting list, with no choice of treating doctors.

So quite different priorities at different stages in life.
 

"He who has Enough is rich".
 
From what I have observed, it depends on the personality of the individual.
If you want to impress people and beat the Joneses, you will probably never have enough.
If your wants, are comensurate with your nest egg, you will be fine.

I've met a lot of older people since retiring, most can live comfortably on the pension, if they own their home.

All the people I know over 80 years old, have had enough of travel, and want to stay in familiar surroundings.

As someone told me, you can't control how much your investments earn. But you can control what you spend.

Also what many on this forum have said, time could run out, before money runs out.
Life is a balance, life is compromise.
 
sptrawler said:
From what I have observed, it depends on the personality of the individual.
If you want to impress people and beat the Joneses, you will probably never have enough.
If your wants, are comensurate with your nest egg, you will be fine.
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Epicurus sums it up nicely: "Plain fare gives as much pleasure as a costly diet once the pain of want has been removed". A dollar figure means nothing.
 
burrow said:
Epicurus sums it up nicely: "Plain fare gives as much pleasure as a costly diet once the pain of want has been removed". A dollar figure means nothing.
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"The pain of want". I like that

If only the youngin's these days could hear something like that.
 
Tyler Durden said:
"The pain of want". I like that

If only the youngin's these days could hear something like that.
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I agree but feel it applies to some super wealthy people too.... Where enough is always just beyond reach.
 
skc said:
Does anyone here actually know anyone who's accumlated enough wealth and is "Living the Dream" so to speak?
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I know a few retire at 55, never work again, travel over sea a few times a year, even have spare change to help their kids with their home etc...they are the typical people describe in the millionaire next door book by Dr Stanley

I didn't even notice these people until I read that book then I start paying attention
His data I reckon can be replicate in most developed countries, obviously developing country as well but the framework and society in a developed countries make it easier for these people to exist and accumulate wealth.
 
Greed is good.

Sadly I think in Australia today this rings true.

Recently started my own SMSF and in the process of doing so, meeting and enquiring about varies products and services about wealth creation and investing, nearly all gave the same greed type sales pitch about retiring early, not having to work anymore as if work is something nasty that no one wants to do (maybe iam a freak as I quite enjoy my job), then there was all the glossy brochures of happy smiling people on yachts or at Cafes sipping lattes with the golf clubs and expensive cars.

Think sometimes we lose sight of the important things in life, I think far too many people will spend there entire lives striving for more, and then even more when they have more than enough and don’t realise it.

Oh, and I didn’t buy into any of it, instead went with esuperfund and ETF,s, and defiantly none of the sure thing real estate offerings that involved massive debt, property and massive loans is being flogged to death right now, i hope all those who are buying the dream do ok, but my gut feel is many wont.
 
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