2007-03-11 08:31:57 · 8 answers · asked by theblackenedphoenix 4 in Business & Finance ➔ Personal Finance
the way I look at it, i consider someone "rich" if they don't have any debt to pay off and don't need a job anymore. The amount of wealth to be considered financially independant varies between each person because they all have different needs.
If you have money in the bank, its going take a very very long time to even accumulate $1 million, even at 5%. Plus you will have to pay taxes on the interest. Let's say you are 30 years old and you save $1000/month in the bank with a 5% interest and you never touch the account. At age 60, you will have about $835,000 (before taxes). I don't know what it will be when it gets taxed every year. Let's say your income tax is 25%, that means in 30 years, you will really have about $626,250.
So you really should consider opening a Roth IRA instead and put mutual funds into it. If you are older such as age 45 and above, then you might want to invest in government bonds as well. For younger people, you want to invest in high growth funds. All your investments in the Roth grow tax-deferred, meaning you don't pay any taxes in any year. After age 59 1/2, you can withdraw your money without having to pay any taxes.
2007-03-11 08:50:52 · answer #1 · answered by Anonymous · 4⤊ 0⤋
That is in the eye of the beholder. Some people think a friend of mine is "rich" because he drives a $80+K car and lives in a desirable neighborhood, when the car is leased and he can barely make all the payments (can't even afford to go out to eat occasionally).
If you are the federal government, you think that any household that owns a house (or has a mortgage) and makes over about $75k/year is rich.
I think you have to have enough to be able to independently (w/o working) live a lifestyle that you would enjoy. I think for one person that would require $100k/year (quite a bit more than what it requires while working, because you'd have the time to travel more and do other things I enjoy). So for one person it would be over $1.5M at a 6% interest rate (even more if you factor in taxes)....for more people, especially children that require care, it would be quite a bit more than that.
2007-03-11 08:49:48 · answer #2 · answered by contemplating 5 · 0⤊ 0⤋
A few years ago I saw on TV (Livestyles of the Rich and Famous maybe?) that someone said the "old" money people do not consider one rich until they are worth at least $22 million and have a need for a private jet.
2007-03-11 09:06:31 · answer #3 · answered by gosh137 6 · 0⤊ 0⤋
It is not how much money you make, but how much of it you have to spend. Per example, a person making 30k with 5 kids & a mortgage is not in the same position as a person making 50k with no kids & no mortgage. Don't just think money, think lifestyle. That rich guy might have more stuff, but also more debts.
2016-03-29 00:18:51 · answer #4 · answered by Anonymous · 0⤊ 0⤋
It depends on your perception. Personally I think if you eat every day, have access to clean drinking water and medical care and a safe place to sleep, you're doing better than most of the people who have ever lived in the world. So that makes you rich I'd say.
2007-03-11 09:20:46 · answer #5 · answered by gerrifriend 6 · 0⤊ 0⤋
Depends on your current and future needs - such amounts will vary greatly from person to person, city to city, state to state and country to country. You need alot more money to live in NY, Calif, or NJ than you need to live in Utah or such.
2007-03-11 08:36:58 · answer #6 · answered by xmacro 2 · 0⤊ 0⤋
If you don't have to think about the cost when you want something then your rich.
2007-03-11 08:39:28 · answer #7 · answered by djm749 6 · 0⤊ 0⤋
5-10 MILLION IS THE CURRENT STANDARD.
THAT IS THE STARTING POINT.
2007-03-11 09:51:18 · answer #8 · answered by charlotte q 2 · 0⤊ 0⤋