Icky
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I'm gonna put all my money into slot machines, this working thing is over rated
True in that regard. But that’s not entirely wealth in my opinion. Doesn’t define it.
In a majority of situations the drawdown will exceed the appreciation when you’re in retirement.
Just like health and job satisfaction:Agreed. I didn’t say it was wealthy. Completely different.
1. Not so:
... the [4%] safe withdrawal rate actually has a 96% probability of leaving more than 100% of the original starting principal!
What Returns Are Safe Withdrawal Rates REALLY Based Upon?
An analysis of the historical "worst case scenario" market returns that necessitated creating the 4% rule as a safe withdrawal rate.www.kitces.com
Over 2/3rds of the time the retiree finishes the 30-year time horizon still having more-than-double their starting principal. The median wealth at the end – on top of the 4% rule with inflation-adjusted spending – is almost 2.8X starting principal.
4% Rule Results Since The Tech Bubble & Financial Crisis?
Performance of the "4% rule" safe withdrawal rate approach since the 2000 tech crash and the 2008 financial crisis in managing sequence of return risk.www.kitces.com
2. Unless you define wealth as generational, who cares?
I was just thinking about this as I was reading. My wife and I do pretty well and have very modest debt. We make more then we did 5 years ago but honestly not that much more.I’m surprised no one has brought this up during this thread but I believe age makes a big difference. The 30 year old who makes a 150k a year will be in a lot different financial position than a 50+ year old who has made a 150k for 20 years. Not only does the 50 year old more than likely have a house with a ton more equity that would also be paid off shortly but he has had time to save over 20 years. To a salesman I would assume on paper they are equals but when it comes to finances there is probably a huge gap. I am probably at the bottom of the barrel in RDP income and having to enter the housing market in this economy doesn’t help. At the end of the day life is short and you can’t take your money with you, buy what makes you and your family happy.
Ok, you’re talking 1%er lol.
At the end of the day a 401k isn’t wealth.
My goal is generational, yes.
So if you retire with $2.5M (about what the Charles Schwab’s annual Modern Wealth Survey defines as "wealthy" and reasonably attainable by most with some effort) that gives you $100k/year at 4% SWR (before SS, etc.), there's a decent chance you'll die after 30 years with $7M.
That's not enough? How many children do you have?
I disagree.. I think it’s more of a mindset
I think you would be quite surprised to know what the partners at Deloitte & Touche make...
I have a good friend who was an investment manager for a large firm. He's 50 something and has been retired awhile now. House in Vegas, house in San Gabriel, a whole bunch of 50k+ classic cars, and everything he has is paid for.
Him and his finance buds now flip businesses for a living. And I'm not talking about garages and liquor stores. Business that need BIG cash infusions to survive.
They invest millions and the flip em buh bye.
They do this shit for fun, you know, like the rest of us flip cars and boats?
He could buy any boat he wants. But doesn't need to. His brother has a house and boat in Havasu he can use anytime he wants.
Sure you can. Investing a significant fraction (20%) of one's salary over time pretty much guarantees wealth by retirement age.
It just is hard to see at first, as compounding works similarly to Hemingway's bankruptcy (there's a passage in The Sun Also Rises in which someone is asked how he went bankrupt. “Two ways,” he answers. “Gradually, then suddenly.”).
With all this talk about wealth and retirement
after some simple math looks like I only have to work another 97 years and then I’ll be ready to retire......
So if you retire with $2.5M (about what the Charles Schwab’s annual Modern Wealth Survey defines as "wealthy" and reasonably attainable by most with some effort) that gives you $100k/year at 4% SWR (before SS, etc.), there's a decent chance you'll die after 30 years with $7M.
That's not enough? How many children do you have?
Well.......I need a hand pay to break even.....i might need to work more nowI'm gonna put all my money into slot machines, this working thing is over rated
Wealthy people won’t rely on a 401k.
That answer really depends on your lifestyle.
That is not true. Some wealthy poeple really do rely on thier 401K's. You would be surprised how many poeple have really boring potfolios. A paid for home worth 1 million plus , paid for cars, 2-3 million in reiremennt accounts and that's it. I guess a 3-4 milllion dollar net worth is not wealthy ?
Again, poeple get to choose. Some people hate rental property and some people hate the stock market. I always coach poeple to do both but not everyone wants that.
All this mindset talk is fun but math is math and if you have millions more in assets than you do liabilities then you have wealth. If you want to argure how much wealth should one have then you this could go on for days.
That is not true. Some wealthy poeple really do rely on thier 401K's. You would be surprised how many poeple have really boring potfolios. A paid for home worth 1 million plus , paid for cars, 2-3 million in reiremennt accounts and that's it. I guess a 3-4 milllion dollar net worth is not wealthy ?
Again, poeple get to choose. Some people hate rental property and some people hate the stock market. I always coach poeple to do both but not everyone wants that.
All this mindset talk is fun but math is math and if you have millions more in assets than you do liabilities then you have wealth. If you want to argure how much wealth should one have then you this could go on for days.
It’s already gone on for days
At what age should a person attain that 1,2,3,4 and 5 million dollar net worth?
I disagree, a wealthy family will have much more working for them than a 401k. So, no they aren’t relying on a retirement fund. They have wherewithal to earn more via multiple other sources.
I large portion of what I consider wealth is multiple streams of passive income that will live on. To me that lines up with the definition of wealth much more so than a w2 employee putting some money away in a retirement fund.
It’s times like this I find it easier to be poor white trash.
I’m going to go out on a limb here and say some of you have a much different idea of wealth than I do.
I just love it when what is right for one members plan is shit on by another. It’s all relative folks.
There is always someone looking down at you like you’re a pile of shit and on the other end of the spectrum someone looking up to you like you’ve got more than anybody in the world.
All this mindset talk is fun but math is math and if you have millions more in assets than you do liabilities then you have wealth. If you want to argure how much wealth should one have then you this could go on for days.
I like this formula from the book “The Millionaire Next Door”:
[Your age] x [pre-tax annual household income from all sources, except inheritances] / 10 = your "expected" net worth
If your net worth is twice the result, you are on your way to building wealth.
many of the wealthiest people on Forbes list of world’s wealthiest people have their fortunes tied to stock (the company they founded, for example). Certainly, most have diversified into other streams of income.
Everyone has their own opinion on what is wealthy. IMO, it’s a person that has a level of assets creating enough income they they no longer need to work to maintain their lifestyle, and are happy doing so. It doesn’t matter what the underlying assets are, just as long as they are casting off enough income to keep increasing your net worth. Wealthy also are careful with their spending.
I would say a rich person is burning money and their net worth isn’t that great. I mean, they could be earning $1,000,000 a year, assets of $10MM, and liabilities of $8MM, while burning $1,100,000 a year. That’s probably not wealthy. The guy who quit his job with $1MM in assets, $0 in liabilities, earning $150,000 off the assets, and burning $50,000 a year, could be said to be wealthy. Optics are one thing (flashy toys, big houses, etc), but it definitely doesn’t equate to wealthy universally.
What are assets? Are my businesses assets? I think you know where I’m going with that.
Assets aren’t really worth anything until you sell them.
I like this formula from the book “The Millionaire Next Door”:
[Your age] x [pre-tax annual household income from all sources, except inheritances] / 10 = your "expected" net worth
If your net worth is twice the result, you are on your way to building wealth.
many of the wealthiest people on Forbes list of world’s wealthiest people have their fortunes tied to stock (the company they founded, for example). Certainly, most have diversified into other streams of income.
Everyone has their own opinion on what is wealthy. IMO, it’s a person that has a level of assets creating enough income they they no longer need to work to maintain their lifestyle, and are happy doing so. It doesn’t matter what the underlying assets are, just as long as they are casting off enough income to keep increasing your net worth. Wealthy also are careful with their spending.
I would say a rich person is burning money and their net worth isn’t that great. I mean, they could be earning $1,000,000 a year, assets of $10MM, and liabilities of $8MM, while burning $1,100,000 a year. That’s probably not wealthy. The guy who quit his job with $1MM in assets, $0 in liabilities, earning $150,000 off the assets, and burning $50,000 a year, could be said to be wealthy. Optics are one thing (flashy toys, big houses, etc), but it definitely doesn’t equate to wealthy universally.
What are assets? Are my businesses assets? I think you know where I’m going with that.
Assets aren’t really worth anything until you sell them.
saving and investing are two different things
Shit now a days work at McDonald’s marry an illegal for health insurance and welfare and you can afford anything. When the 15.00 ah hour thing starts that’s my plan. Right now I just pay for everyone else to sit on their asses. My “idea” of wealth isn’t what others call wealth just like owning a “classic boat”. I’m not impressed by someone’s brand new flamin paint job eliminator or their 5 or 6 series BMW. Content with who I am And where I am!
I like this formula from the book “The Millionaire Next Door”:
[Your age] x [pre-tax annual household income from all sources, except inheritances] / 10 = your "expected" net worth
If your net worth is twice the result, you are on your way to building wealth.
many of the wealthiest people on Forbes list of world’s wealthiest people have their fortunes tied to stock (the company they founded, for example). Certainly, most have diversified into other streams of income.
Everyone has their own opinion on what is wealthy. IMO, it’s a person that has a level of assets creating enough income they they no longer need to work to maintain their lifestyle, and are happy doing so. It doesn’t matter what the underlying assets are, just as long as they are casting off enough income to keep increasing your net worth. Wealthy also are careful with their spending.
I would say a rich person is burning money and their net worth isn’t that great. I mean, they could be earning $1,000,000 a year, assets of $10MM, and liabilities of $8MM, while burning $1,100,000 a year. That’s probably not wealthy. The guy who quit his job with $1MM in assets, $0 in liabilities, earning $150,000 off the assets, and burning $50,000 a year, could be said to be wealthy. Optics are one thing (flashy toys, big houses, etc), but it definitely doesn’t equate to wealthy universally.
That answer really depends on your lifestyle.
Content with who I am And where I am!
That is great book. The research was done in 1980 and still stands up. If you want to read another good one that expands the reseach to over 10,000 Amercian Millionaires check out " Everyday Millionaires " by Chris Hogan
I like this formula from the book “The Millionaire Next Door”:
[Your age] x [pre-tax annual household income from all sources, except inheritances] / 10 = your "expected" net worth
If your net worth is twice the result, you are on your way to building wealth.
many of the wealthiest people on Forbes list of world’s wealthiest people have their fortunes tied to stock (the company they founded, for example). Certainly, most have diversified into other streams of income.
Everyone has their own opinion on what is wealthy. IMO, it’s a person that has a level of assets creating enough income they they no longer need to work to maintain their lifestyle, and are happy doing so. It doesn’t matter what the underlying assets are, just as long as they are casting off enough income to keep increasing your net worth. Wealthy also are careful with their spending.
I would say a rich person is burning money and their net worth isn’t that great. I mean, they could be earning $1,000,000 a year, assets of $10MM, and liabilities of $8MM, while burning $1,100,000 a year. That’s probably not wealthy. The guy who quit his job with $1MM in assets, $0 in liabilities, earning $150,000 off the assets, and burning $50,000 a year, could be said to be wealthy. Optics are one thing (flashy toys, big houses, etc), but it definitely doesn’t equate to wealthy universally.
It’s times like this I find it easier to be poor white trash.
I’m going to go out on a limb here and say some of you have a much different idea of wealth than I do.
I just love it when what is right for one members plan is shit on by another. It’s all relative folks.
There is always someone looking down at you like you’re a pile of shit and on the other end of the spectrum someone looking up to you like you’ve got more than anybody in the world.
While I ultimately 100% agree with you, life isn’t about money.. This particular thread is..
I don’t think it was intended or even presented as some dick measuring contest.. If it was believe me there is some whale dicks on rdp. Lol.
I think it’s just a group of middle class to upper middle class guys wondering what it takes to break into upper class. Nothing wrong with talking about it and giving opinions.
Truthfully I find the conversation refreshing because usually nobody is ever willing to talk about this stuff at all. If I can learn anything from it to make more money I know I’d be appreciative..
I hesitate to try and teach anyone because I don’t think I’m in an experienced enough or financial position to do so.
I have observed good friends though that have made more money in a month then I will
Make in a lifetime and try to glean off them what I can and I sure as shit listen when they talk.
So if I made 100k x 44 years old = 440k divided ten = 44,000.00.
if my assets are twice thst at 88k I’m building wealth?
but on the inverse if we add a zero and I made 1,000,000 x 44 = 44 mill divided by ten is 4.4 million.. so I’d need 8.8 million?
I’m not sure I’m grasping the equation here based off those examples for round numbers?
So if I made 100k x 44 years old = 440k divided ten = 44,000.00.
if my assets are twice thst at 88k I’m building wealth?
but on the inverse if we add a zero and I made 1,000,000 x 44 = 44 mill divided by ten is 4.4 million.. so I’d need 8.8 million?
I’m not sure I’m grasping the equation here based off those examples for round numbers?
I'm with you
I love this conversation as most people are uncomfortable talking about money, For some reason money is taboo ?
I also LOVE listenting to those people who are actually winning and it is not just some opinion from another broke ass with an opinion or an idea he heard on a late night infomercial or a $99 course he just purchased.
Good times !
Maybe it is time to start the RDP mastermind group where people can share their business ideas adventures struggels etc ?
less is more
some will understand most won’t
Maybe I was being a little melodramatic but there was one member telling another member that he couldn’t possibly get wealthy by just having a 401(k). Not a big deal I just found it somewhat comical.I didn’t see anyone in this thread shit in anyone’s plan.. ???
Ironically enough I haven’t seen any of the people I know to be what I would consider “wealthy” to post in this thread either..