High Net Worth Individuals - Poll

Ok Guys

According to another thread "An estimated 17,000 Australians became high-net-worth individuals last year, taking the number to about 134,000.

A high-net-worth individual (HNWI) is someone who has investable assets of at least $US1 million ($1.28 million as at December 31 last year). That excludes the family home, cars, durable goods and collectables."

I think geoff worked that out at about 1 in 100.

So how are we going on Somersoft ?

Somersoft

Hi Sea Change

I have already voted, however, thought there was an option left out. What about the people who do want to make that goal, but through their situation/beliefs don't believe they can in the next couple of years or by the next boom. Maybe something like "In the next 20 years"

Skater

Fair enough ( though I think you'd be suprised how quickly you can get there ....) . Had a look to see if I could edit it but I think a moderator or a "super moderator" is needed.

See Change

New option added to the poll

see_change said:

Fair enough ( though I think you'd be suprised how quickly you can get there ....) .
See Change

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I agree. It needn't take that long, however not everyone has the same skills, or is willing to take the same risks (whether real or perceived). There are some that are very young & don't have any savings yet, let alone investments.

Hi all.

This has really given me something to think about.

Yes, I have a fair bit of equity and the last property boom has had a lot to do with that but what I'm trying to decide (and have been for some time now) is how to physically enjoy the fruit of that labour.

Sure I could do the LOC or cashbond thing but I'm still not convinced that this form of "living off equity" is for me. The reason being that I would still be growing my debt which is what I have to overcome.

I've heard the argument that as long as your capital is growing more than your expenditure that everything should be alright, but I still don't know, maybe it is my mindset.

Then another part of me says that what is the point of investing if you don't get to enjoy the capital growth.

When I first started investing I had visions of owning X amount of houses outright and just living off the rents and paying tax on that but then I started researching, reading, going to seminars etc and realized that further debt can give me more leverage to further invest which brings me back to where does it all end!!

I apologise if this post has gone off the topic but the reason I posted it is because I realized that I'm in the HNWI range but I don't yet have the lifestyle that I imagined would come with it. Maybe others are doing more with their equity (maybe the stated HNWI figure is too easily achieved), which is what I was hoping to learn from others i.e how to enjoy you built up equity.

Regards
Marty

Well according to the results there are at least 12 people I need to be getting advice from in the forum

<KS>

Marty

Being someone who believes in cycles and timing , we've sold off a moderate amount of our portfolio over the last six months.

There are several things we can do with this. We have three kids at privates schools and we've paid off two years off one of them in advance. One only has two more years to go so now instead of having to find three lots of school fees each year, we only have to pay two , so this increases our cash flow so we can spend it on either more investments or on doodads.

We used some of the money to pay for an OS holiday and I've also bought a Hobie cat.

At the moment the rest is sitting in Offset accounts so we are generating income from our IP's. Again we can spend this on further investments or Doodads.

While there may be good bargains out in the property market , I think you have to look hard for them , and as I'm basically lazy (and find looking at IP's boring after a while ) I'm happy to wait untill there are lots of bargains around and my decision is which bargain to buy , not, where is one.

We are about to do a development , which will take up the money that e have in the offsets and a little bit more. If we can sell that for a reasonable amount then we'll have more money available to either enjoy life for a few years or do further investing.

Our kids are getting older now, so I'm tempted to spend the next few years enjoying life before they leave home, without stretching our exposure to the market to the max again.

See Change

<KS> said:

Well according to the results there are at least 12 people I need to be getting advice from in the forum

<KS>

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I'd have a bet they give plenty of advice on the forum already.

See Change

kissfan said:

I realized that I'm in the HNWI range but I don't yet have the lifestyle that I imagined would come with it. Maybe others are doing more with their equity (maybe the stated HNWI figure is too easily achieved), which is what I was hoping to learn from others i.e how to enjoy you built up equity.

Click to expand...

You'll figure it out Marty,

And you'll learn to enjoy the fruits of your labour in whichever way works best for you, and not by the standards set by others.

Yes making it to the HNWI (and beyond) is easily achieved. In fact, the more you have the easier and quicker it becomes to accumulate more.

Interestingly though, whilst striving to build wealth, dreaming of all the "doodads" they will buy when they "make the big time" people often forget that as you get older, your wants and most certainly your NEEDS for luxuries diminishes (albeit your tastes OTOH may go the opposite way). For example, holidaying at 2.5 star hotel may once have been ideal, when you have more money to splash around, even some 5 star establishments can appear second rate!!!

Whatever happens, enjoy the destination as much as you did the journey, you've earnt that right!!!

Cheers,

Jo

Whatever happens, enjoy the destination as much as you did the journey, you've earnt that right!!!

Cheers, Jo

Click to expand...

i am enjoying the journey so much, i hope i never reach the destination i'll just keep buying the odd little trinket on my way thru the exotic markets of my life to make it all worthwhile.

lizzie

It's not (all) about the asset

G'day all

Good thread (as usual, SC). For my 2 cents worth, I can't eat capital value, so I focus on income streams and try (unsuccessfully) not to focus too much on asset values.

If I had just $40,000 passive income on a $35,000 spending lifestyle, I'd consider myself rich no matter what my "net assets" were.

kissfan said:

Hi all.

Yes, I have a fair bit of equity and the last property boom has had a lot to do with that but what I'm trying to decide (and have been for some time now) is how to physically enjoy the fruit of that labour.

Sure I could do the LOC or cashbond thing but I'm still not convinced that this form of "living off equity" is for me. The reason being that I would still be growing my debt which is what I have to overcome.

I've heard the argument that as long as your capital is growing more than your expenditure that everything should be alright, but I still don't know, maybe it is my mindset.

Then another part of me says that what is the point of investing if you don't get to enjoy the capital growth.

When I first started investing I had visions of owning X amount of houses outright and just living off the rents and paying tax on that but then I started researching, reading, going to seminars etc and realized that further debt can give me more leverage to further invest which brings me back to where does it all end!!

I apologise if this post has gone off the topic but the reason I posted it is because I realized that I'm in the HNWI range but I don't yet have the lifestyle that I imagined would come with it. Maybe others are doing more with their equity (maybe the stated HNWI figure is too easily achieved), which is what I was hoping to learn from others i.e how to enjoy you built up equity.

Regards
Marty

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Dear Marty,

1. Seems to me that you are not totally convinced about living off your productive debt despite your present house equity available.

2. May I ask how much equity that you are presently having?

3. Perhaps, if your present house equity allow you to consider this option: why don't you pay down on one of your property and make it debt-free first and start enjoying a "debt-free" property instead .... so as to start realsing part of your dreams today?

4. Cheers,

regards,
Kenneth KOH

Kennethkohsg said:

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Dear Marty,

1. Seems to me that you are not totally convinced about living off your productive debt despite your present house equity available.

2. May I ask how much equity that you are presently having?

3. Perhaps, if your present house equity allow you to consider this option: why don't you pay down on one of your property and make it debt-free first and start enjoying a "debt-free" property instead .... so as to start realsing part of your dreams today?

4. Cheers,

regards,
Kenneth KOH

Click to expand...

Hi Kenneth.

No I'm not convinced re living off equity, need a little more coaxing.

As far as present equity, it's approx just into the $1.28M give or take.

Didn't really want to sell off any I/P's at this stage, as they are taking care of themselves i.e negatively geared but nothing that is not too hard to handle. Actually, fairly neutral with tax deductions, depreciation etc.

Was thinking of using some of the equity to do next purchase which would consist of (1) using X amount for deposit & (2) X amount to service the loan for X amount of years. Still unsure if I like step 2 yet as it falls into that living off equity scenario that I have to get my head around. Still deciding.

Regards
Marty

Monopoly said:

For example, holidaying at 2.5 star hotel may once have been ideal, when you have more money to splash around, even some 5 star establishments can appear second rate!!!

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For some, it means being able to afford a waterproof tent instead of a leaky one

GP

GreatPig said:

For some, it means being able to afford a waterproof tent instead of a leaky one

GP

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ROFL........

The fun is when it's squelchy underneath the Tarp , and the squelchy bits croak !!!!

I'm a sucker for Camping , and I think in the future when the kids are talking about memorable holidays it's just as likely to be the time, they were towed on a boogie board, behind a bike between tents while Mum and Dad were hoping the tent didn't get flodded...

See Change

Tee Hee

Had to add my vote - tee hee.
By the way I presume you are referring to the Merrill Lynch/Capgemini World Wealth Report 2005 on the investing habits of high net worth individuals?
Have you:
A. Read it? It is a must read for all people thinking of becomming genuinly wealthy - it blows away heaps of the myths propigated upon people about how the wealth invest.
B. Discussed it in here - I think it could be one of the best discussions of the year!
If you haven't (it's pretty heavy going) here is a link to a SMH article on it.
The article itself provides much interesting information.
URL: http://www.smh.com.au/articles/2005/06/17/1118869094999.html

Peter Spann said:

Had to add my vote - tee hee.
By the way I presume you are referring to the KPMG report on the investing habits of high net worth individuals?
Have you:
A. Read it? It is a must read for all people thinking of becomming genuinly wealthy - it blows away heaps of the myths propigated upon people about how the wealth invest.
B. Discussed it in here - I think it could be one of the best discussions of the year!

Click to expand...

I haven't seen the report. Do you have a link to it?

skater said:

I haven't seen the report. Do you have a link to it?

Click to expand...

Not sure about a KPMG report, but the Merrill Lynch/Cap Gemini one is here. There is a recent thread discussing it elsewhere. And also an old thread about last years report.

NB Acrobat failed to read it when viewed thru the browser. I had to save to disk first.

Amended

keithj said:

Not sure about a KPMG report

Click to expand...

Amended
(The KPMG one was about Wealth Management)

By the way I am amazed the last discussion didn't generate more interest.
This report reveals the investment strategies of the rich...
Is everybody to desparate to hold onto their own views to have a discussion about the way the actual wealthy made their money thourgh investing, especially the UHNWI's?