Meet the millionaires
- Thread starter redwing
- Start date
It seems like education is probably the surest path to wealth according to this and other studies.
I am also surprised to note that 3 percent of households have net worths over 5 mil. This is a big number considering that the american population is over 300 million people. In Australia, 5 mil plus gets you into the top one percent. So wealth is far more prevalent that we commonly think.
Finally the figures presented show that people are mostly asset rich and income poor. Despite worth many millions, the incomes are mostly less than 150k per year which means retired millionaires are living pretty basic lives.
I am also surprised to note that 3 percent of households have net worths over 5 mil. This is a big number considering that the american population is over 300 million people. In Australia, 5 mil plus gets you into the top one percent. So wealth is far more prevalent that we commonly think.
Finally the figures presented show that people are mostly asset rich and income poor. Despite worth many millions, the incomes are mostly less than 150k per year which means retired millionaires are living pretty basic lives.
It was surprising - yet not - to me.
These were people with 1m investible cash. If that is all you had then most likely it is only earning $100-150k each year if you are retired. As a retiree you have no other income to grow it and you can't spend the base money or your income stream would go down.
I would almost classify these people as not rich. They are merely people who have access to their 41K (Super) plus possibly some investments during their lifetime. They are very comfortable but not in the league of the very wealthy
I dont think that 1 m investible cash with no other supporting income would generate 100-150k per year for retirees in australia. Given that interest rates are lower in usa than in australia, it would be closer to 20-30k per year.
True - I don't know what maths I was using to make that statement up lol!
So I wonder where the rest of their income is coming from?
I wonder if Dr Stanley was involved in this study - seems to have all the hallmarks.
1m is comfy but not really rich. Then again, they got this way because they saved and invested instead of showing off, as we know - so don't need a silly income.
I like these studies 'cause it dispels some of the bunkim that Kiyoski sold - i.e. that being educated gets you nowhere.
1m is comfy but not really rich. Then again, they got this way because they saved and invested instead of showing off, as we know - so don't need a silly income.
I like these studies 'cause it dispels some of the bunkim that Kiyoski sold - i.e. that being educated gets you nowhere.
I read this survey differently. Assets need only to generate a very comfortable living. Anything above that should generate growth greater than cash in the bank to provide for the years going forward. Initially I worked toward having a cash asset on retirement and soon realised that is very short sighted.
I reckon real weatlh, (multi million dollar status) would be more prominent in people that haven't been had some kind of tertiary education or dropped out.
Most of the really successful rich people realize that a degree is only going to get you so far and there are better ways out there to make money/invest.
regardless whether the sample is valid or not,
I wouldnt expect much of a proportion of people having $1m+ in cash to be doctors
Being a doctor as a whole gets you a very very good income, Unless you are brain surgeon or have your own clinic (then its a business)
To get into the stinking rich category, you need to be a CEO or business owner or entrepenuer
none of these you need a medical degree, let alone a degree of any sort
I wouldnt expect much of a proportion of people having $1m+ in cash to be doctors
Being a doctor as a whole gets you a very very good income, Unless you are brain surgeon or have your own clinic (then its a business)
To get into the stinking rich category, you need to be a CEO or business owner or entrepenuer
none of these you need a medical degree, let alone a degree of any sort
Yes it does , but so does one million according BRW .
http://www.brw.com.au/p/brw-lounge/australia_millionaire_factory_people_wuPnD3RDmN8Jv9kwWYwiHL
Cliff
I agree that the ultrawealthy are often without formal education. However, these are the sheer minority. For the "average" person without entrepeneurial flair/ business sense/ drive , the easiest and surest way to millionaire status - not billiionaire nor extreme wealth - is via a degree that allows a semi-successful professional career.
Most of the people that have a college degree and a solid professional career will still generally make there money through something like property investment, or shares etc. that will be the reason for there wealth. investing is the way to make money and not trading hours worked for money.
A reason might be because people that go to college are surrounded by more people that think the right way about money so that influence wears off on them.
but sometimes i can't see the logic in a college degree. you spend 5 years studying to earn 100,000 pa. once you finish that study you are 50,000 behind with education fees. on the other hand there are plenty of decent paying jobs that don't require degrees. you might be able to get 60,000 straight off the bat...the 5 plus years someone has spent going to uni and getting a degree you have had time to save a deposit to start your property portfolio, create some sort of business etc. if you know how to manage money well then uni seems pointless in some respects??
Totally agree with this - I'm sure most do. And then when you get out of uni you may feel like you need to travel, too. Poor for a bit longer. Then you have to get a job when you get back home - not so easy if there's a recession on.
Meanwhile, friends who didn't go to uni have bought nice little homes.
And not many of us learn the skills of investing at uni or shcool or even from our families.
It's not necessarily the job you get. 100K a year isn't the norm at all.
It must be something else. It could be learning from your friends, it could be the ability to research, it could be going for work that is rewarding in itself, giving self esteem and the ability to keep working well into the twilight zone.
When it comes down to it, it's the people who don't waste money who end up with the most. You don't have to be educated for that.
But let's not pretend that being educated is only about making money, 'cause it's not. The older you get, the better it works for you.
100k p.a. is where it begins for many professionals straight out of university. Where it ends up is what matters.
http://www.smh.com.au/federal-polit...rs-hardest-hit-in-new-tax-20140429-zr1el.html
The vast majority of investors cannot reliably generate 300k gains year on year for over a long period of time whereas certain professions will generate that reliably for several decades after graduation.
No i don't agree with that, maybe yes if your an engineer or specialist doctor.
but for most people with commerce degrees, arts degrees etc they still have high university fees and once they finish would be on par with the average tradesman wages who have already been earning wages for the time its taken them to get there trade.
And I'm not talking about making 300k pa as an investor. people that are making that sort of money only have to be in the game for 10 years and they are in that top tier bracket, which is not what we are talking about.
We are brought up to believe that going to university is what you have to do because you need to get a 'good job'. Most people on here I'm sure have read rich dad poor dad, i think that book explains it well. people that believe going to university to get a good job is the correct way is the poor dad way of thinking.
Nothing wrong with getting wrong with a degree I'm just saying theres better ways of going about things if making money is your goal.
and even more people with higher education are financially better off compared to people without higher education i don't think its because of the studies they have done.
Let's not get the reliability of newspaper articles mixed up with actual research.
Apart from surgeons, the other 2 professions are not as well off as some would like us to believe. Don't you have any friends in finance who were house mums and dads for years after the GFC? And we all know that mining has it's ups and downs.
They're very high-earning professions and good on them. But not everyone who goes to uni does this. Keep it real.
At the same time, while Kiyoski pointed out how assets work vs aimless spending with some good diagrams, his puffed up claims and dumbed-down narrative derided his own father for being a teacher - and it was all anecdotal. Not someone I really admire.
Have you read Stop Acting Rich and Start Living Like a Millionaire and The Millionaire Next Door both by Thomas J Stanley? He actually researched what he writes about.
Agreed. So it is important to choose what you study at university.
Arts / commerce degrees are probably not that worthwhile. But law, engineering, medical and actuarial degrees probably are. You should not spend years at uni for the sake of being there. You should do something at uni that will stand you in good stead for the decades to come, something that can generate 300k plus, year on year till retirement. This is not a bad deal for the "average" person who does not wish to be a tradesman, lacks entrepeneurial or business sense. Making millions from a business start up and/or investing is far more difficult and unachievable for most than getting a professional degree and working your way up to being a partner in a law firm or becoming a specialist doctor.
Lol. Funniest comment I've read all weekend.
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