What is rich?

I think its fair. Everything is relative. And the comparison is to the larger percentage of the retirees.

If you have that many assets (not including your home), most likely you know how to utilise these so that you can live a more comfortable lifestyle than the majority with less. If not, then you go below the threshold and get payed the full pension anyway.

I think it’s just relative. Rich is not defined by those who have more, but those who need less.

Hi Don,

Interesting concept.

In the objective realm of wealth, I would consider that it would be assets that allow you to pay for all your costs after tax (without the requirement of a job).

These costs can be quite subjective (e.g. private school costs for children, extravagance of holidays) and basically comes down to what your cost of living is.

I would consider someone that is wealthy as not needing to work, being able to afford a comfortable standard of living (subjective) and still have funds left over. I aspire to be wealthy, and this means firstly defining what that amount is for me and what a comfortable standard of living is.

The rough figures I work on is $2.85 million in net worth. Little bit different to $750k. $2.85 means that I do not eat into my capital and have a comfortable standard of living after tax on my gross income.

Some really good information is here: https://www.superannuation.asn.au/resources/retirement-standard which discusses different levels of living standards in retirement.

Good question,

Ben.

@captain,
10k in expenses – power/phone/transport/clothing/incidentals etc
10k in food – maybe including a restaurant trip once or twice a month etc but not much more
10k in luxuries eg a new tv or holiday or some around the house renovations etc once a year

trust me that 30k isn’t going to go far……better get investing/saving now as to buy a new car once in a while or holiday every year or the ability to hire a cleaner to help around the house as you age etc….you are going to be needing at least twice that amount (and keep in mind that’s TODAYS dollars)

If you are wanting to retire in 10 years from now then double that 60k figure to $120k non debt income every year (or basically $4m in 2025 of unencumbered assets on a 3% annual drawdown) so basically unless you have $2m in assets today you’re not ready to retire……

Rich is relative. Every single one of us on this forum is comparatively rich compared to the worlds poor.
http://en.wikipedia.org/wiki/International_inequality
http://www.gallup.com/poll/166211/worldwide-median-household-income-000.aspx
Rich and wealth are also terms with differing definitions.

To me being rich, or wealthy, are all encompassing terms and include finances but are not limited to finances. They also include mindset, family, capacity, opportunity, grace and generosity. I have known some truly rich people who had relatively small bank balances, because their outlook on life was so good they felt, and seemed rich.

Also your title “what is rich” in my mind is very different to what is required for a “comfortable” retirement.

But if you are asking what it takes to have a “middle class” aunsralian comfortable retirement I would suggest 50-80k zero debt could do it. This will require 1.5-2 mill of unencumbered income generating assets depending on the yield.

Very simple for me.
I earn atm $950/ wk without working.
I have 3 levels for me.
$500/wk I am secure
$2000/wk I am comfy
$1mio/ year I am rich.

All the money will be passive income.
I wont have to work

The confidence one has in their strategies, of returning back to wealth, if disaster was to strike – is what I would consider as being “Rich”.

Very similar to a “doomsday prepper” but without the camo gear & tonnes of baked beans………….OK. I lied about having too much baked beans, it’s probably best to keep stacking those tins. :)

“Those who fret the decline in gold price, don’t really understand gold.”
The above quote teaches us that it is not only personal loss that our strategies should be limited to.
As well as accumulating property, perhaps it is wise to remain relatively wealthy by owning gold, if / when global financial issues arise.

Cheers.

I used to believe rich was those who drove nice cars, lived in nice houses and ate at only the finest restaurants. I now know better, most of those people with these luxurious lifestyles are not rich. Some live pay check to pay check just like those on a medium wage. Being rich has much more to do than appearances alone.

Obviously there is more to it than just money, you can have a very rich life without much money, but my definition here will focus on money.

Being rich to me means you have accumulated enough wealth that you can live on your assets, without having to work, but still maintain a lifestyle of abundance. This may differ on someone’s definition of abundance – Donald Trump would never be satisfied with only a few million dollars in networth, however, others are perfectly happy to.

Going back to a few post above, someone living in Nepal would consider most Australian’s to be rich. This question has to take account of the subject answering it.

For me it stems down to a person’s definition of an abundant lifestyle and what price that comes to.

Which of coarse means, in the original post, someone who has near zero assets and is close to retirement, is likely to consider someone with assets of 750k outside their home to be very very rich.

• This reply was modified 7 years, 11 months ago by  Shane W.