You Need to Know How Much Money It Takes To Be Rich to Invest for Your Needs
How much money does it take to be rich? It's a question that is forever popular and as old as time. Here are some thoughts on answering it for yourself. Brand New Images / Stone / Getty Images
Have you ever wondered how much money it takes to be considered rich? That is the question posed to a group ofinvestment advisors from a recent CNN Money publication that caught my eye. Although the answer will undoubtedly vary by country, this group was focused on those living in the United States. Most seemed to believe that it took between $2 million and $12 million to be rich. This would generate roughly $300,000 in annual passive income and would allow you to afford the following lifestyle all without a job:
Pay all taxes
Spend $3,800 per month on housing expenses
Have $12,000 in cash left over each month to spend any way you like - cars, vacations, clothing, charitable donations, education assistance for your family, entertainment, etc.
Whether or not you agree with that assessment, it's an interesting topic and one around which we've danced in the past. Specifically, both here on Investing for Beginners and my personal blog, we've talked about the qualifications for being rich, how the rich generate money, how investing in stocks, bonds, mutual funds, real estate or other assets can assist you on your journey to becoming rich, and a lot more such as the correlation between education and becoming first-generation rich.
Part of the Problem Is That "Rich" Is Almost Always Implicitly Defined as a Relative Term, Not an Absolute Term
A challenging part of determining how much money it takes to be considered rich comes from the fact that when capitalism lifts a vast majority of boats in terms of increases in real purchasing power, as it has done for the past few centuries, the new, elevated standard of living gets taken for granted. The typical American household today enjoys the highest standard of living of any period in this country's history, despite what the general media impression might cause you to believe. It's so extreme that nearly all American families live a life of more affluence and comfort than John D. Rockefeller did at the height of his wealth. Technological innovations and productivity increases in even the lowliest places, such as the rise of the modern washing machine, have resulted in the typical American having 40 more hours of relaxation time per week than one of their ancestors did in 1880. (Sadly, research has shown that virtually all of this 40 hour gift is consumed by watching television.)
Families now have two cars instead of one. The typical footprint of an American home is obscene compared to our grandparents. That home is now climate controlled with air conditioning and central heat. It has on-demand hot and cold water. It's wired for high-speed Internet. It has televisions capable of displaying brilliant colors with incredible sound, tapped into an infinite library of media that exceeds anything our forbearers could have conceived. The U.S. Government now considers a married couple with two kids making $44,000 to be in poverty under certain definitions; an obscene thing when you consider that puts the family in the top 1% to 2% of global affluence.
In other words, those bemoaning the current state of the middle class are largely displaying their economic ignorance. Yes, it should be better. Yes, health care and education costs are rising beyond what is sustainable due, in no small part, to perverse government incentives, inflating a bubble along the way just as was done in housing last decade. It doesn't change the fact that there has never been a better time to be alive for a super-majority of the citizens of this country.
Still, that's not what people mean when they ask, 'What is rich?". This is because of two fascinating quirks in human evolution that behavioral finance has given insight into in recent years.
People are satisfied by the perceived trajectory of their life, not necessarily the absolute quality of their life once certain minimum needs have been met. That is, a person who goes from making $25,000 a year to $150,000 a year is going to feel more happiness than a person who goes from making $10,000,000 a year to $500,000 a year despite the fact that the latter is still among the highest earning households in the United States and earns far more than the former.
People are satisfied by being materially, but not necessary excessively, richer than their peers, family members, friends, colleagues, and neighbors. It is not an accident that the amount of annual income at which personal happiness tops out is about 50% higher than the median household income. There is also an element of envy present. To borrow an example put forth by a well-known investor, you see traders ecstatic to get a $1,000,000 bonus on Wall Street until they realize the guy at the next desk got $2,000,000 then they are miserable. In most cases, it's irrational but people develop grudges, hurt their own reputations, become spiteful, and, in some cases, outright hostile because of a perceived lack of fairness. The money, in other words, has become a proxy for emotional considerations; how valued the person is, how intelligent they are perceived to be, how necessary they are to the team.
How I Determine Whether Someone Is Rich or Not
For my own purposes when discussing income, as opposed to net worth, I classify "rich" three distinctly different ways depending on the circumstances.
The Absolutely Rich - On a global scale, I think the line probably starts somewhere around $80,000 per annum. A family earning that amount in the United States, and run by someone who is financially intelligent, will enjoy a standard of living that utterly surpasses, in every meaningful way, the experience of a vast majority of people alive on planet Earth, both now and at any time in history. On a country-specific scale, I think it begins somewhere around $400,000 in household income here in the United States. The absolute purchasing power is staggering compared to the typical family and opens doors that most don't even know exist. You've definitely crossed into that territory once you get into what one academic researcher called "the glittering rich", which is pre-tax household income of $3,000,000 to $5,000,000 per annum beyond which additional sums of money lose their personal utility and become little more than a scorecard.
The Relatively Rich - If you forced me to draw the line somewhere, I'd probably do so at the top 5% to 10% of household income, perhaps adjusted by geographic peculiarities, because it means that a family in that situation is out-earning 90 to 95 out of 100 other families.
The Truly Rich - Personally, I consider someone rich based upon a simple relationship between personal desires, control over time, and insulation from financial disaster. That is, to me, a person becomes rich the moment 1.) he (or she) can afford the lifestyle he desires solely from a stream of passive income or from a career that does not exist at the mercy of others and therefore cannot be taken away easily, and 2.) is able to spend his time doing precisely what he wants, when he wants, how he wants, where he wants. Thus, there are situations in which I may consider someone earning $50,000 a year to be rich while someone earning $2,000,000 a year something else entirely.
I explained my personal philosophy in an article called The Secret Philosophy of Successful Investing. Your goal as a new investor should not be to merely pile up treasure endlessly at the expense of the products, services, and experiences you want for your life. Instead, it should be to find out what it is you want, how much monthly cash you need to afford it, and then we can work on calculating the total investments that would be required to service that lifestyle. Money is a tool that exists to serve you. It would be an extraordinarily dumb thing to spend your life slaving away to accumulate resources that you will never enjoy if doing so comes at the expense of your own happiness. The key, as in so many areas in life, is to "know thyself". If you are fortunate enough to be average, when you were born, 27,375 days were deposited into your mortal bank account. You've already spent quite a few of them. One day, the clock will run out so you might as well make sure you get the most enjoyment out of each of those days you've been gifted through no virtue or merit of your own.
Go through life collecting assets, avoiding liabilities; pay attention to asset placement; figure out how to get paid to do what you love. For some, that might be living in a cabin in Colorado, fishing and reading all day, hunting with your beloved dog, and learning to play an instrument. For others, it might mean expensive cars, a wardrobe of bespoke Ede and Ravenscroft with matching bespoke George Cleverley shoes, wearing Creed Bois du Portugal as you study your portfolio in your newly built custom Clive Christian study glancing at your $250,000 Patek Phillipe Grand Complications watch with flawless diamonds. There is no right and wrong answer. One is not better than the other. They are merely different; a matter of personal taste much the same as some preferring beef and others preferring chicken.
My goal in writing about investing, finance, capital allocation, portfolio management, risk, diversification, and other life lessons, is to give you some of the lessons that I've learned on my own journey so that your journey, in turn, becomes easier.
Need a professional writer? Fiction and non-fiction? contact richard.nata@yahoo.co.id Let me introduce myself. My name is Richard Nata.I am an author, novelist, blogger and ghost writer. My articles, including short stories have been published in magazines and newspapers since 1994. I have written a lot of books, both fiction and non-fiction. So I was a professional in the field of writing, both fiction and non-fiction.
I was born in Jakarta, August 17, 1968.
In 1988, at the age of 20 years, I started working as an accounting staff. Age 24 years has occupied the position of Finance Manager. Age 26 years as a General Manager.
In 1994, my articles published in magazines and tabloids.
In 1997, I wrote a book entitled "Buku Pintar Mencari Kerja". This book is reprinted as much as 8 times. Through the book, the authors successfully helped tens of thousands of people get jobs at once successful in their careers. They were also successful when moving to work in other places.
In 1998, I started investing in shares on Bursa Efek Indonesia (Indonesia stock exchange). As a result of investing in the stock market then I can provide consulting services for companies that want to go public in Indonesia stock exchange.
Jika Bapak/Ibu ingin konsultasi mengenai perusahaan Go Public, dikenakan fee. - lewat email Rp. 300.000,- ( per 1 atau 2 kali email ). Email ketiga dan seterusnya d...
In theory, in 10-20 years into the future, my startup income, amounting to hundreds of million USD annually can be obtained easily. AND IF FOLLOWED BY MANY COMPANIES IN THE WHOLE WORLD WILL THEN BE A NEW INDUSTRIAL worth trillions USD.
To be honest. Currently I'm not having a lot of money. So I start marketing my startup with blogspot.
My STARTUP :
A story with millions of choices in it - looking investor like you.
Try to imagine this. When you're reading a story on the web or blog, you are given two choices. You can choose the next story based on your own choice. After selecting then you can continue reading the story. Shortly afterwards you will be presented back to the 2 other options. The next choice is up to you. Then you continue the story you are reading. After that you will be faced again with 2 choices. So onwards. The more stories you read so the more options you have taken.
If you feel curious then you can re-read the story by changing your selection. Then you will see a different story with the story that you have read previously. The question now is why is this so? Because the storyline will be varying according to your choice.
I, as the author is planning to make tens of thousands of articles with millions of choices in it. With tens of thousands of articles then you like to see a show of your favorite series on TV for several years. The difference is while watching your favorite TV series, then you can not change the story. Meanwhile, if you read this story then you can alter the way the story according to your own choice.
You might say like this. Sounds like a book "choose your own adventure". Books I read when I was young.
Correctly. The idea is taken from there. But if you read through a book, the story is not so exciting. Due to the limited number of pages. When a child first you may already feel interesting. But if you re-read the book now then becomes no fun anymore because you don't get anything with the amount of 100-200 pages.
Have you ever heard of game books? When you were boy or girl, did you like reading game books? I think you've heard even happy to read it.
A gamebook is a work of fiction that allows the reader to participate in the story by making effective choices. The narrative branches along various paths through the use of numbered paragraphs or pages.
Bantam Books with the Choose Your Own Adventure series has produced more than 250 million US dollars. While I offer you more powerful than the Choose Your Own Adventure. Because of what? Because the story that I made much more interesting than the stories created by the authors of Bantam Books. You will not get anything just to 100-200 pages. While the story that I created is made up of tens of thousands of articles with millions of choices in it.
Based on the above, then you are faced with two choices. Are you interested in reading my story is? Or you are not interested at all. The choice is in your hands.
If you are interested then spread widely disseminated this article to your family, friends, neighbors, and relatives. You can also distribute it on facebook, twitter, goggle +, or other social media that this article be viral in the world. By doing so it is a new entertainment industry has been created.
WHY DO I NEED STARTUP FUNDS FROM INVESTORS? I NEED A LOT OF FUNDS FROM INVESTORS BECAUSE I HAVE TO LOOKING FOR EXPERT PROGRAMMERS(IT).BECAUSE THE DATA IS HANDLED IS VERY LARGE, IT MAY HAVE TO WEAR SOME PROGRAMMERS(IT). I CAN NOT WEAR SOME FREELANCE PROGRAMMER BECAUSE THE DATA MUST BE MONITORED CONTINUOUSLY FROM VIRUSES, MALWARE, SPAM, AND OTHERS. IN ADDITION FUNDS FROM INVESTORS IS ALSO USED TO BUY SERVERS WITH VERY LARGE CAPACITY. FUNDS ARE ALSO USED TO PAY EMPLOYEE SALARIES AND OPERATIONAL COSTS OF THE COMPANY.
FUNDS CAN ALSO BE USED FOR ADVERTISING AND OTHER MARKETING STRATEGIES.FUNDS CAN ALSO BE USED TO ADVERTISE MY STARTUP AND OTHER MARKETING STRATEGIES.
IF I GET A VERY LARGE FUND, THE PART OF THE FUNDS USED TO TRANSLATE THE STORY INTO VARIOUS LANGUAGES.With more and more languages, the more readers we get.
WITH MORE AND MORE READERS, THE MORE REVENUE WE GET.
AS AN INVESTOR THEN YOU DO NOT HAVE TO FEEL ANXIOUS ABOUT YOUR FUNDS. BECAUSE YOUR FUNDS WILL NEVER BE LOST BECAUSE IN 3-5 YEARS YOU HAVE RETURNED THE FUNDS COUPLED WITH PROFIT.
THIS BUSINESS IS ONE AND THE ONLY ONE IN THE WORLD.
If we can make a good story, so that the readers will come again and again for further reading the story then our earnings will continue to grow and will never diminish. This is due to new readers who continued to arrive, while long remained loyal readers become our customers.
So that the number of our readers will continue to multiply over time. With the increasing number of loyal readership then automatically the amount of income we will also grow larger every year. The same thing happened in yahoo, google, facebook, twitter, linkedin, and others when they still startup.
Deuteronomy {28:13} And the LORD shall make thee the head, and not the tail; and thou shalt be above only, and thou shalt not be beneath; if that thou hearken unto the commandments of the LORD thy God, which I command thee this day, to observe and to do [them: ]
Try to imagine this. If I give a very unique story. It was the first time in the world. But the world already know this story even liked it. Because the world love the game books. While the story that I made is the development of game books.
Do you Believe ifI dare say if I will succeed because my story will be famous all over the world as Harry Potter?
I believe it. Not because I was the author of the story, but because of the story that I made is unique and the only one in the world.
Income from my startup :
1. Ads. With millions of unique visitors, the price of the ads will be expensive.
2. Affiliate marketing. In addition to advertising, we are also able to put up some banner from affiliate marketing.
3. Contribution of the readers. If you have a million readers and every reader to pay oneUS dollarper year then you will get the income of one million US dollars per year.
If you have a million readers and every reader to pay one US dollar per month then you will get as much revenue twelve million US dollars per year.
4. Books and Comics. After getting hundreds of thousands to the millions of readers of the story will be made in books and the form of a picture story (comics).
5. Movies. If we have a good story with millions of readers then quickly we will be offered to make a film based on the story.
6. Merchandise related to characters. After the movies there will be made an offer for the sale of goods related to the characters.
7. Sales. With millions of email that we have collected from our readers so we can sell anything to them.
Each income (1-7) worth millions to tens of millions of US dollars.
Because each income (1-7) worth millions to tens of millions of US dollars. Then in 10-20 years into the future, AI will be earning hundreds of million USD annually.
So how long do you think my story that I made could gather a thousand readers? Ten thousand readers? One hundred thousand readers? A million readers? Five million readers? Ten million readers? More than ten million readers?
But to get all of it of course takes time, can not be instant. In addition, it takes hard work, big funds and placement of the right people in the right positions.
By advertising, viral marketing, strong marketing strategies and SEO then a million readers can be done in less than a year. Ten million readers can be done in two to three years.
This is the marketing strategy of my startup.
When hundreds of thousands or millions of readers already liked my story then they have to pay to enjoy the story that I made.
If you are a visionary then you will think like this.
With the help of my great name in the world of business, my expertise in marketing, advertising, marketing by mouth, viral marketing, then collecting a million readers to ten million readers will be easy to obtain. Is not that right?
The question now is what if people like my story as they like Harry Potter? You will get tens of millions or even hundreds of millions of email addresses from readers. With that much email, we can sell anything to the readers.
Since April 2013, Wikipedia has around 26 million articles in 285 languages are written by 39 million registered users and a variety of anonymous people who are not known from other parts of the world. Web ranked by Alexa, Wikipedia is a famous website number 6 which has been visited by 12% of all Internet users with 80 million visitors every month and it is only from the calculation of America.
resource : http://www.tahupedia.com/content/show/136/Sejarah-dan-Asal-Mula-Wikipedia If no Wikipedia then need hundreds of thousands to millions of books required to make 26 million articles in 285 languages into books. With the Wikipedia then people started to leave to read a book or books to seek knowledge about a subject or many subjects. The same thing will happen. Read a story in a book or books to be abandoned. Read a story with millions of choices on the web or blog is far more interesting than reading a book or books. So what happens next? In 10-20 years ahead then read a story in a book to be abandoned. Otherwise my startup will grow and continue to develop into a new entertainment industry. New entertainment industry, where I was a forerunner startup will continue to evolve. Therefore, in 10-20 years into the future, my startup will be earning hundreds of million USD annually.
So do not delay. Invest your money immediately to my startup. Take A Look. There are so many advantages if you want to invest in my startup.
WHY YOU SHOULD INVEST YOUR MONEY RIGHT NOW? .
IF YOU INVEST YOUR FUNDS IN ONE, TWO OR THREE YEARS INTO THE FUTURE, YOU MAY BE TOO LATE. BECAUSE IN 1-3 YEARS INTO THE FUTURE THEN I'VE GOT THE FUNDS. THE FUNDS CAN COME FROM SOME INVESTORS, LOANS FROM BANKS OR FROM ADVERTISEMENTS POSTED ON MY BLOG. IF I'VE GOT A LARGE AMOUNT OF FUNDS THEN I'VE NO NEED OF YOUR FUNDS. SO INVEST NOW OR NOT AT ALL.
My BLOG started to be written January 11, 2015. TODAY, MAY 30, 2015, THE NUMBER OF CLICKS HAS REACHED 56,750. SO FAR SO GOOD.
If I get big funds from investors then with a quick story that I wrote will spread throughout the world. So I got acceleration because I can put ads in a large variety of media such as Google AdWords, Facebook, and others. I also can perform a variety of other marketing strategies.
If I do not get funding from investors then my story would still spread throughout the world. But with a longer time, Slow but sure. So either I get funding from investors or not, the story that I wrote will remain spread throughout the world. Ha ... 7x So don't worry, be happy.
My advice to you is you should think whether the data that I have provided to you makes sense or not .
If my data reasonable then immediately invest your funds as soon as possible.
Then we discuss how we plan further cooperation.
Thank you.
Lord Jesus bless you.
Amen
P.S. The offer letter I gave also to the hedge funds and venture capital and other major companies in the entire world. So who is fast then he will get it.
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