u have people managing to live off benefits and your auntie has 1mil and probably mortgage paid off, 4% p/a interest should be enough for her. But saying that, depends on requirements. To a person on average wages 1 mil is a hell of a lot and to an individual worth 10mil is simply 10%. It's a pointless debate IMHO.
ignore the political stuff on the page, but enjoy the perspective of $$ http://www.crunchweb.net/87billion/ --RS
1 million is no doubt a large amount of cash. It is not enough, however. My estimate is that the net worth from which a person can be named a "wealthy person" is 10 million. This means that at the risk free rate he has an income of 500000 per year. Any person earning more than $500000 per year or with a networth more than 10 million is rich. at > $100,000,000 you can name this person "very rich". It is the level where the average man will start looking hard for ideas about spending. One cannot spend very quickly this amount. at > $1,000,000,000 you can name the person "billionare" and list it in the Forbes magazine. Business elite starts here. at > $10,000,000,000 he is either Bill Gates or someone trying to take his place in the top. His words move markets. He is in the elite of a globalized world.
10 million is about right. Enough to buy the boat, car, house, investment house, holiday house and still ahve some left over to fund a decent account size to generate cashflow
Great...here you have people that wouldn't know a million dollars if it bit them in the ass talking about 2-5 million like its chump money. I love it.
I have lived both in Southern California and NYC. In California, I felt much wealthier then I do now. Part of the reason was my dollar seemed to go further at the stores. When I went to Florida for a month, it seemed as if I was almost visiting a foreign country where you could get a decent meal at a restaurant for very cheap. Although my worth is almost 4 times what it was in California, I feel poorer and more insecure in New York City. The prices in NYC are insane and you cant live decently without paying astronomical prices. Its very easy to spend over $100 in a day without even doing that much. I dont see myself staying in NYC for the rest of my life. Just there to make my coin and take off. Its definately not a place to retire. I liked SoCal better, much better looking women and better weather. Much cleaner too.
I have a million dollars, i bet quite a few ppl in the states have million dollars as well. The only problem is that if i were to realise my 1 million dollars i would have no place to live. Alot of ppl in australia (where i live) and the US are millionaires simply because of inflated house prices, and their refinancing against those inflated values. One day the house market will crash and those ppl will get bitten on the ass.
My humble opinion is that houses are liabilities until sold. Many people lump their house with their worth. However, a house is not cash. You cant wire or ACH a house. Cash has a specific definition in the dictionary and the word "house" is not there. If I go to the store or online to travelocity, I cant use a house to pay the bill. The bottomline is that you should not consider your house as part of your worth. You are only fooling yourself if you do. . . If the truth be told, many people are having trouble selling their houses at the current time. In a year, we will see the value of these houses drop. So is a house an asset at the current time? Well, it seems more like a depreciating liability right now. . .
When you do not look at prices, if you like it you buy it. Also come hell or high water you know your retirement plan is well financed and in safe instruments. When your credit report is mox-nix because you pay cash and just keep a credit card in emergency etc................
I just wanted to add this one comment about housing. Around the mid-90s, I was employed by Wells Fargo and I had to listen to many stories from people who were over their heads on mortgage loans. The tone in these people's voices was similiar to those who had a family member just die. It was a very sad experience dealing with people who were underwater on their "investment". Here we are many years later and now we see people who have seemingly forgot this horrid past. We hear that real estate will never go down. However, I do not forget the tone of those voices. There is no substitute for age and experience. Thats why I believe Countrywide will survive where as IndyMac might be in trouble. One company you have an experienced captain who has braved many stories. The other has a young inexperienced captain who has never had to steer his ship through a hurricane. A house is a speculative instrument and sometimes a liability. I would never label it as a long term investment. . .