Discuss How much do you need to be "rich"?

[450SEL6.9]

I've always wanted to ask this question. What net worth does one need to be considered rich?

For the longest time it was probably $1 million. What is it today, $10 million? $50 million? Keep in mind that athletes can make $40-50 million per year. Movie stars get $20 million per film. On the business side, new entrepreneurs in China, Russia and India take their companies public and have multibillion dollar net worths. A Chinese property developer listed his company on the Hong Kong Stock Exchange and gave shares to his daughter. Those are worth $9 billion U.S.

Also, please no answers like "you're rich if you have friends" or "you're rich if you're happy and have enough".

I think $1 million was a lot of money even into the early 1980s. Even the top TV star at that time was making about $2 million before tax. The top F1 drivers and baseball players were probably also in that bracket. However, since the '80s, hyper-inflation took over and everything shot up in price, especially luxury properties.

 

[Mr. M]

I still think $1 million is the universal standard that you're fairly well off.

 

[Yperion]

One million is no big deal for today's standards. Some people can spend that amount of money in 24 hours.

I would say 50 million dollars at least.

 

[Centurion]

I still think $1 million is the universal standard that you're fairly well off.

Yeah with $1 million you are well off and wealthy.............but you're not rich. Hear me out.

In todays world of globalization and increasing property prices $1 million isn't as much as people think it it. That some of money will barely get you a town home in Chelsea London or if you just want to buy a nice big home anywhere in the world half of the sum will easily be spent. Then you'd want to live out your dreams and buy a few fancy cars and fly out to St. Barts and Monaco and floss there a couple of times a year. And before you will no it you won't be any much wealthier than the average well educated mortal.
By definition of rich is when you have to much money that you don't have to work and can simply live off the interest of your money, while at the same time enjoying just about anything in life. IMO you can't do that unless you are sitting on a 10 million dollar account.

 

[GTA45E]

One million is no big deal for today's standards. Some people can spend that amount of money in 24 hours.

I would say 50 million dollars at least.

I have to agree with Yannis here. $1,million doesn`t really cut it these days with all the consumer options we have now.

 

[Choleric]

If you are making $1million a year, you're definately rich.

Only having $1million in the bank doesn't neccessarily make you rich.

 

[450SEL6.9]

... In todays world of globalization and increasing property prices $1 million isn't as much as people think it it. That some of money will barely get you a town home in Chelsea London or if you just want to buy a nice big home anywhere in the world half of the sum will easily be spent.

By definition of rich is when you have to much money that you don't have to work and can simply live off the interest of your money, while at the same time enjoying just about anything in life. IMO you can't do that unless you are sitting on a 10 million dollar account.

That $1 million won't buy you a floor in Chelsea. I think property services firm Knight Frank estimates the average price for a luxury home in London to be 4 million pounds or $8 million U.S. In 1976, the average was supposedly 100,000 pounds!

In a novel I read, having enough money so you don't have to work and still have anything you want means having "Screw You Money". It basically means you have enough money to say screw you to anyone or anything.

 

[Centurion]

A very tiny percentage of the world's population have "screw you money". Most importantly those people are not only worth billions but they have a great amount of power and influence. These are people like Lakshmi Mittal, Richard Branson and Bernard Arnault.

 

[mercmad]

In the UK, to be in the top 1000 rich list you have to have atleast £70 million which is about $140 million.

EDIT: I think you have to have about £10 million to be rich which is about $20 million.

 

[450SEL6.9]

mercmad, do you know when the first UK Rich List was printed? Any ideas what was the minimum you needed to get on such a list in the 1980s?

Luwalira, it is interesting that you bring up those billionaires' names. In '87, Forbes published its first worldwide billionaires list. These where then the richest and, presumably, smartest people in the world. You would expect them to have longevity. Unfortunately, not one of the ten richest men in the world in '87 is still in the top ten in 2007. I think only 25% of the names on the initial list are still there today! And these are some of the smartest men around.

 

[Imhotep Evil]

1 million doesn't cut it anymore, but 1 billion would do nicely.

You rich if you're a brainiac buisnessman
... like Bill Gates/Paul Allen (M$) or S. Brin/L. Page (Google) or Steve Jobs.

 

[Centurion]

mercmad, do you know when the first UK Rich List was printed? Any ideas what was the minimum you needed to get on such a list in the 1980s?

Luwalira, it is interesting that you bring up those billionaires' names. In '87, Forbes published its first worldwide billionaires list. These where then the richest and, presumably, smartest people in the world. You would expect them to have longevity. Unfortunately, not one of the ten richest men in the world in '87 is still in the top ten in 2007. I think only 25% of the names on the initial list are still there today! And these are some of the smartest men around.

What's so unusual about that? You can be academically talented have an IQ above average and still be as worthless at business as an in-an-out meal is as a dinner. Making money is a game, a gift regardless if it is legal or illegal. If you're good at it, you can flip a coin into a bundle of money.
P. Diddy is a good example. He is an artist and honestly a quite wack one. The money he has had coming in from record sales is only a fraction of what some of the top selling artist who have existed the latest 10 years. Thanks to his money skills he is worth an estimated $346 Millions, which makes him one of the richest people in show business.

 

[audi_rudy]

I feel that many people try and get the impression that they are rich by taking out huge loans to buy big houses and nice cars. But then these people live miserable lives trying to afford these things. I think that being rich is having enough money in the bank to buy whatever (reasonably) you want and not worrying about how your going to pay for it. I think that 10 mil would probably do the trick as long as you continue to make money.

 

[MoSs]

to me money doesnt make you rich... when u are satisfied with ur life and what u have makes u rich, no matter how much u got.

 

[450SEL6.9]

What's so unusual about that? You can be academically talented have an IQ above average and still be as worthless at business as an in-an-out meal is as a dinner. Making money is a game, a gift regardless if it is legal or illegal. If you're good at it, you can flip a coin into a bundle of money.

What's unusual is that the blokes on the list in '87 were not worthless businessman or some lucky guy who won the lottery. Most of them were self-made. They were very smart people business-wise. I never said anything about any of these guys being academically talented or what they IQs were. By "smartest", I meant they were smart in business.

What I said was that it is surprising (to me) for 75% of the richest businesspeople in '87 to disappear from altogether from the '07 Rich List.

I feel that many people try and get the impression that they are rich by taking out huge loans to buy big houses and nice cars. But then these people live miserable lives trying to afford these things.

True, but I asked what 'net worth' one needs to be rich. Net worth already accounts for the people who take out huge loans to live lavishly because net worth subtracts the liabilities.

 

[Matt]

Your only rich if you're life is filled with love and friendship

If you are making $1million a year, you're definately rich.

Only having $1million in the bank doesn't neccessarily make you rich.

Most people dont just store millions of dollars in the bank. What makes a person rich is has aptitude in spending and his ability to make wise decisions with the money he earns and the assets he buys and develops. In fact, someone once told me, its not how much money you have, its how much you can borrow. I totally agree. But i would say that if your income is over 500k$ you're technically rich or perhaps "well-off". According to the U.S. government tax bracket, if your making over 100k$ you are rich.

 

[450SEL6.9]

In fact, someone once told me, its not how much money you have, its how much you can borrow.

And it's that mentality which has partially contributed to household debt (as a percentage of GDP) in America exceeding pre-Great Depression levels.

 

[Matt]

perhaps, but If nobody borrowed money from the banks-our economy would shut down. In fact borrowing for investment has always had a positive affect pushing our economy closer to potential output. you should read Rich Dad, Poor Dad-its a great book.
BTW, money is only one type of wealth-assets are another-and if you can borrow, it means that the bank has decided that your assets are greater than your liabilities.

 

[450SEL6.9]

Just because a bank lends you money does not mean it made a decision your assets exceed liabilities. In fact, many banks do not even take a detailed look at your assets, specifically when they give you an unsecured line of credit. Credit cards offers go out to anybody and everybody. Mortgages are granted to just about anyone and 1/7th of all mortgages written in the past few years in the USA are held by people with the worst credit. Pretty soon these peoples liabilities will exceed their assets.

Banks lend you money because it is their business to lend money. They know how to manage their inevitable bad debts. A decision to grant a customer a loan says little about assets > liabilities.

I agree with you that borrowing investment is indeed a wonderful idea. However, the people who are borrowing are not borrowing for investment. They are borrowing (against their equity in their home) for consumption, to buy that new boat or that fancy new SUV.

So, getting back to the original question . . . Is the new "rich" $10 million, 25 or 50 million?

 

[YoUhimhER]

i'd say $20million in owner's equity.