Comments on: How Much Do You Need to be Rich? http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/ Latest Credit Card News, Reviews and Information Thu, 08 Jan 2009 16:58:27 +0000 http://wordpress.org/?v=2.7 hourly 1 By: Paul http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-84683 Paul Wed, 01 Oct 2008 21:52:26 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-84683 $4 million in TODAY's dollars for me. That would spin off about $160,000 of tax free income. I think I could cover all my expenses, be generous, and still have enough for a fun trip to Europe with $160,000 a year. That assumes that I've saved for my kids' college. Now, what $4 million will be in 2025 dollars... that is anyone's guess. $4 million in TODAY’s dollars for me. That would spin off about $160,000 of tax free income. I think I could cover all my expenses, be generous, and still have enough for a fun trip to Europe with $160,000 a year.

That assumes that I’ve saved for my kids’ college.

Now, what $4 million will be in 2025 dollars… that is anyone’s guess.

]]> By: I.D. http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-80103 I.D. Mon, 25 Aug 2008 10:29:18 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-80103 100 million or more and the world is yours! 100 million or more and the world is yours!

]]> By: Qbo12 http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-76399 Qbo12 Tue, 15 Jul 2008 08:43:02 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-76399 @Mr. Medium i agree, being able to live off the interest of your interest would theoretically guarantee that you would never run out of money. This could be done given a large enough initial principle, say inheritance, Lottery, etc. sadly, most of us is better off trying to figure out the best way to configure a winning portfolio out of however much money we have. in my opinion, 5 million is a good point to settle on, and it is a lot more practical to achieve. However, the difficulty of making money beyond millions grows exponentially for an average person with salary based income. @Mr. Medium
i agree, being able to live off the interest of your interest would theoretically guarantee that you would never run out of money. This could be done given a large enough initial principle, say inheritance, Lottery, etc. sadly, most of us is better off trying to figure out the best way to configure a winning portfolio out of however much money we have. in my opinion, 5 million is a good point to settle on, and it is a lot more practical to achieve. However, the difficulty of making money beyond millions grows exponentially for an average person with salary based income.

]]> By: Mr. Medium http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-39905 Mr. Medium Mon, 05 Nov 2007 16:52:20 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-39905 The traditional position on this is that to be rich is to be able to live off the interest of your interest. I think that still holds today, as it would in any day. The traditional position on this is that to be rich is to be able to live off the interest of your interest. I think that still holds today, as it would in any day.

]]> By: Wealth Building Lessons http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-18713 Wealth Building Lessons Thu, 07 Jun 2007 01:13:13 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-18713 i agree with you somewhat. I don't really have a fixed dollar amount to feel rich - i look at it in terms of cashflow. If I had enough to pay my bills and put food on the table, i'd quit my job. I agree with the the $36k/yr figure in that sense, but if you invest in something that yields 12%, thats only $300,000! (of course diversification of principle is important). In order to feel rich and buy any piece of crap that I liked, I think $40,000/mo with be the magic number. (mainly because I'm married, if it was just myself, it would be closer to $12k/mo) & I'd probably move to thailand or spend a few months a year there. its dirt cheap and its a lot of fun. i agree with you somewhat.

I don’t really have a fixed dollar amount to feel rich - i look at it in terms of cashflow.

If I had enough to pay my bills and put food on the table, i’d quit my job. I agree with the the $36k/yr figure in that sense, but if you invest in something that yields 12%, thats only $300,000! (of course diversification of principle is important).

In order to feel rich and buy any piece of crap that I liked, I think $40,000/mo with be the magic number. (mainly because I’m married, if it was just myself, it would be closer to $12k/mo)

& I’d probably move to thailand or spend a few months a year there. its dirt cheap and its a lot of fun.

]]> By: Mr Credit Card http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-18712 Mr Credit Card Thu, 07 Jun 2007 01:12:51 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-18712 Whether you choose a 50/50 split or 70/30 depends on how much is your portfolio worth and how much do you need in annual income. Depending on your income needs and wealth level, a 50/50 split is OK if you can live off the income from the bond portfolio. However, if all you have is one million and you do a 70/30 split, then you can only get about $15,000 in annual income from you bond portfolio. I think that to many people will just too little. Then, you have to eat into your principal (which is fine if that is you wealth level when you are 65). So the issue is : Does your level of wealth and income needs permit you to have a 50/50 split? Whether you choose a 50/50 split or 70/30 depends on how much is your portfolio worth and how much do you need in annual income. Depending on your income needs and wealth level, a 50/50 split is OK if you can live off the income from the bond portfolio. However, if all you have is one million and you do a 70/30 split, then you can only get about $15,000 in annual income from you bond portfolio. I think that to many people will just too little. Then, you have to eat into your principal (which is fine if that is you wealth level when you are 65).

So the issue is : Does your level of wealth and income needs permit you to have a 50/50 split?

]]> By: Carnival of Personal Finance 103 http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-18000 Carnival of Personal Finance 103 Tue, 05 Jun 2007 11:20:05 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-18000 [...] AskMrCreditCard has some interesting thoughts on how much you need to retire. It’s more than you might think. [...] [...] AskMrCreditCard has some interesting thoughts on how much you need to retire. It’s more than you might think. [...]

]]> By: pf101 http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-17922 pf101 Tue, 05 Jun 2007 06:17:35 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-17922 I agree with MoCo that 50/50 split in your mid 60s is too conservative. The old rule of thumb was 100-your age = amount in stocks. The new rule of thumb is 120-your age = amount in stocks. Now, rules of thumb are just suggestions, but this one is probably pretty close. Experts are saying that you should stay at least 70% in equities into your 70s and possibly 80s depending on your risk tolerance. You have to remember that your money has to last for 30-40 years and if you're making bond and savings account level returns you're barely breaking even on half of your money. That could be dangerous. I agree with MoCo that 50/50 split in your mid 60s is too conservative. The old rule of thumb was 100-your age = amount in stocks. The new rule of thumb is 120-your age = amount in stocks. Now, rules of thumb are just suggestions, but this one is probably pretty close. Experts are saying that you should stay at least 70% in equities into your 70s and possibly 80s depending on your risk tolerance. You have to remember that your money has to last for 30-40 years and if you’re making bond and savings account level returns you’re barely breaking even on half of your money. That could be dangerous.

]]> By: Carnival of Personal Finance #103: The 24 Edition at Clever Dude Personal Finance & Money http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-17610 Carnival of Personal Finance #103: The 24 Edition at Clever Dude Personal Finance & Money Mon, 04 Jun 2007 12:11:03 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-17610 [...] However, the former and current President Palmers provided well for all that Jack went through for the last half-decade of his life, and the insurance money he received when Nina killed his wife is still in the bank. Maybe he really does have enough money to be considered “rich” [Mr Credit Card]. Good thing he was friends with those presidents. He didn’t get along too well with the last prez… [...] [...] However, the former and current President Palmers provided well for all that Jack went through for the last half-decade of his life, and the insurance money he received when Nina killed his wife is still in the bank. Maybe he really does have enough money to be considered “rich” [Mr Credit Card]. Good thing he was friends with those presidents. He didn’t get along too well with the last prez… [...]

]]> By: MoCo http://www.askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/comment-page-1/#comment-16462 MoCo Fri, 01 Jun 2007 03:02:07 +0000 http://askmrcreditcard.com/creditcardblog/how-much-do-you-need-to-be-rich/#comment-16462 I think that your investment plan is too conservative. The only funds that should not be in equities are those that you will need within the next five years from any moment in time. If, at retirement, you have a million dollars, put no more than $250,000 of it in a low risk, income-oriented investment so that you are not forced to sell equities in the event of a long market decline. Keep the other $750,000 in equities that will grow at the rate of about 12% to 15% per year on the average. In this way, you will never run out of money. I think that your investment plan is too conservative. The only funds that should not be in equities are those that you will need within the next five years from any moment in time. If, at retirement, you have a million dollars, put no more than $250,000 of it in a low risk, income-oriented investment so that you are not forced to sell equities in the event of a long market decline. Keep the other $750,000 in equities that will grow at the rate of about 12% to 15% per year on the average. In this way, you will never run out of money.

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