# Are You Rich Enough (Probably - Hopefully)



## Lawlar (Nov 6, 2007)

I think TUGGERS will find this interesting:

    How much are people making in this country, and how much do they have?  It is a lot less than you think.  Or, you can think of this in a positive way, you are doing a lot better than most.

    Here is the breakdown on household family incomes:

     Level VI (90 to 100)       $170,000 
     Level V (80 to 89.9)       $99,000 
     Level IV (60 to 79.9)      $65,000 
     Level III (40 to 59.9)     $40,000 
     Level II (20 to 39.9)       $24,000 
     Level I (less than 20)     $10,000 


    In other words, if you (and your spouse combined) are making $99,000 or more, you are in the top 20%.  Get to $170,000 and you are in the top 10%.  Note that 60% of households in this country earn $40,000 or less.

    Now how much you earn is not as important as how much you save.  Most Americans don't save and its really scary.  Here is the breakdown:

    Net worth for American families - includes equity in home, retirement accounts, stocks, savings accounts, etc.:

     Percent                               Net worth
     Level VI (90 to 100)            $833,600 
     Level V (80 to 89.9)            $263,100 
     Level IV (60 to 79.9)           $141,500 
     Level III (40 to 59.9)          $62,500 
     Level II (20 to 39.9)            $37,200 
     Level I (less than 20)          $7,900 


    Note that 20% of this country has less than $7,900 (if they lose their job, they would lose everything within a few months).  60% of the country has less than $62,500 in equity (scary).  

    On the positive side, you "only" need $833,600 to be rich (top 10%).
    {I believe that 5% of the country are millionaires - with the top 1% having so much money you wouldn't believe it.]

    So take a deep breath, relax, and be happy.  You are probably doing better than you think.

    Larry


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## Steamboat Bill (Nov 6, 2007)

Lawlar said:


> On the positive side, you "only" need $833,600 to be rich (top 10%).



If you invested $833,600 in a 5% CD (assuming you want to be retired), you will only produce $41,680 per year (then you pay taxes of at least 30%) nets you about $30,000 per year.

Thus, I would hardly consider someone having $833,600 (and no longer working) to be classified as rich. It is a nice number, but does not allow an opulent lifestyle. In fact, many retired government employees get over $30,000 per year in retirement benefits.


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## Kal (Nov 6, 2007)

I always hate to see inclusion of the primary residence in any calculation.  Especially today when the value of a home in many parts of the country is declining.  Even then, you have to live somewhere.  If you sell your home, you've got to buy a new tent.

Take that number out of the calculations and the chart looks very interesting.  Then try to predict the future in the US and it's Halloween time.  Just continue to borrow money from China and keep the printing presses running overtime!  UGLY!


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## Lawlar (Nov 6, 2007)

*Rich or Not*

Steamboat Bill is right.  The amount that Americans will need to retire greatly exceeds what they have.  Sadly, I think we will have a lot of grey haired people working in this country.  
	Kal raises a scary issue also – how much of what we have is the result of the printing presses running overtime.
	I read with interest recently a TUGGER’S comment about Newport Coast.  He was fascinated by all of the luxury cars on the road.  I’ve lived in California all my life so I guess I stopped noticing.  What amazes me is all of the McMansions along the Coast, from San Diego to Santa Barbara, that are valued at millions of dollars each.  The last time I walked around Balboa Island, in Newport, I looked at a flyer for a very small house that was for sale (this was in 2006).  The price: six million.  Twenty years ago you could have bought it for less than a couple hundred thousand.  If all of this wealth in California real estate is resting on subprime loans then we could be headed for a train wreck.  In a way, our country seems to be lining up as the haves and the have nots (or at least, have lesses).  Then again, I see a lot of people enjoying a very good life in this country.  It is an interesting phenomenon.  Let's hope the good times keep rolling.


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## CaliDave (Nov 6, 2007)

Lawlar said:


> The last time I walked around Balboa Island, in Newport, I looked at a flyer for a very small house that was for sale (this was in 2006).  The price: six million.  Twenty years ago you could have bought it for less than a couple hundred thousand.



My Grandparents bought a VERY nice house on Balboa Island about 22 years ago. $410,000. They sold it 12 years ago for $750K. I'd guess it's in the $6 million range now.
Prices are outrageous.. I could see the high end homes dropping 25-30% in the next few years. 
We've already seen a drop of at least 15% in our So Cal home in the past 18 months.


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## Kagehitokiri (Nov 6, 2007)

once you hit a certain price level, market forces really dont apply at all.

interesting survey >
http://www.elitetraveler.com/marketvolatilitimpactstudy.pdf


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## Tia (Nov 6, 2007)

A neighbor three years ago had a single income 3+ times what we were making at the time on our single income. The neighbor was complaining he didn't make enough $ to my other half.  . The same neighbors wife is back to work now ,  since they didn't make enough $ ya know?  They are now over the $230K easily with no mortgage on the house either  . They do have two in college but a grandma is paying for all those expenses. Their 14yo not so long ago was trying to get us to add her to our family cell plan, d/t it being cheaper, her  parents just couldn't afford another $50 single plan....    So even if some are pretty well off in the numbers  some of those  will never have enough!!!


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## Kal (Nov 6, 2007)

Lawlar said:


> ...Kal raises a scary issue also – how much of what we have is the result of the printing presses running overtime...


 
Just look at the Euro and Canadian Dollar and that will tell you what the world financial community thinks about the US financial stability.

How much are we paying today (and tomorrow) for buying sand in the mid-east?  I wish I could invest in "sand futures".


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## Steamboat Bill (Nov 6, 2007)

Kagehitokiri said:


> once you hit a certain price level, market forces really dont apply at all.
> 
> interesting survey >
> http://www.elitetraveler.com/marketvolatilitimpactstudy.pdf



That was a cool report...some key findings

Consumers with a Net Worth of $10 million + are significantly less likely to cut back on spending and feel significantly better about their personal financial situation than other segments.

Consumers with a Net Worth of less than $5 million are “extremely concerned” about their financial situation and are actively “Trading Down”.

Over 75% of consumers with a Net Worth of less than $10 million “need” to make “major” lifestyle changes if the market continues to deteriorate, compared to 1 in 4 for those in Households with a N et Worth of $10 to $25 million and 1 in 10 for those in Households with a Net Worth of $25 million
or more.


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## Kagehitokiri (Nov 6, 2007)

Elite Traveler has a lot of interesting stuff 
http://www.elitetraveler.com/research.html
http://www.elitetraveler.com/etinsider.html
http://www.elitetraveler.com/press.html

Merrill Lynch/Capgemini's World Wealth Report
http://www.ml.com/index.asp?id=7695_7696_8149_74412_79272_79918

Forbes 400
http://www.forbes.com/2007/09/19/richest-americans-forbes-lists-richlist07-cx_mm_0920rich_land.html
(all billionaires, 946 globally now)


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## Steamboat Bill (Nov 6, 2007)

Kagehitokiri said:


> Elite Traveler has a lot of interesting stuff
> http://www.elitetraveler.com/research.html
> http://www.elitetraveler.com/etinsider.html
> http://www.elitetraveler.com/press.html
> ...



ok...now I am getting depressed. 

I have met 6 different billionaires and knew only 1 well. They really live in rarefied air.


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## Kagehitokiri (Nov 6, 2007)

> I always hate to see inclusion of the primary residence in any calculation.


 agreed, to a certain degree. ML/CG doesnt, and is individual, not household. dont think Prince does either, IIRC they do both individual and household. but a lot of the mainstream reports ive seen do. not sure about IRS, and forget when their next report is out, next year?


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## Kal (Nov 6, 2007)

*A Feel Good Net Worth Calc*

On Sunday (11/4/07) there was a story about calculating net worth. Here's what it said:



> "_Multiply your age by your pre-tax income then divide that number by 10. That answer is what your net worth should be to be considered wealthy_"


 
Aside from the fact that the approach is looney, it should make lots of people erroneously feel good.


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## jerseygirl (Nov 6, 2007)

> "Multiply your age by your pre-tax income then divide that number by 10. That answer is what your net worth should be to be considered wealthy"



Hmmmmmmmmmm ... I'm either poor or old.


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## philemer (Nov 6, 2007)

jerseygirl said:


> Hmmmmmmmmmm ... I'm either poor or old.



Better than BOTH poor and old! Many of those around the country & the globe.


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## John Cummings (Nov 7, 2007)

I would like to add one of the very few positive notes to this thread. We are definitely living the American Dream. I am retired and my wife has never worked outside the home. We are in the top 10% income and top 5% net worth. We started with nothing and I have earned every penny we have. I know some of you do not like to hear success stories but there are some of us around. The US is truly the land of opportunity if one is willing to take advantage of the opportunities.


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## Kal (Nov 7, 2007)

Congrats John....but we have heard this about 45 times.


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## Steamboat Bill (Nov 7, 2007)

John Cummings said:


> I would like to add one of the very few positive notes to this thread. We are definitely living the American Dream. I am retired and my wife has never worked outside the home. We are in the top 10% income and top 5% net worth. We started with nothing and I have earned every penny we have. I know some of you do not like to hear success stories but there are some of us around. The US is truly the land of opportunity if one is willing to take advantage of the opportunities.



I would rather hear "how you made" it rather than a declaration of success. Either way, congrats.....hopefully you are making well over the $40,000 in yearly "passive" income needed to be considered wealthy. 

My personal opinion is that I would need about $250,000 per year or more in "passive income" to consider myself wealthy and some of my friends consider $500,000 per year the threshold for being considered rich.


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## John Cummings (Nov 7, 2007)

Kal said:


> Congrats John....but we have heard this about 45 times.



And I have heard your negativity at least that many times. I am just adding a little balance to the discussion.


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## John Cummings (Nov 7, 2007)

Steamboat Bill said:


> I would rather hear "how you made" it rather than a declaration of success. Either way, congrats.....hopefully you are making well over the $40,000 in yearly "passive" income needed to be considered wealthy.
> 
> My personal opinion is that I would need about $250,000 per year or more in "passive income" to consider myself wealthy and some of my friends consider $500,000 per year the threshold for being considered rich.



What do you consider to be passive income? I don't consider myself to be wealthy, just pretty comfortable.


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## Steamboat Bill (Nov 7, 2007)

Pasive income is a regular income stream not tied to you working for it (in a traditional sense) such as bank interest, stock dividends, pension payments, rent from a property, profit from stocks or bonds, royalities, etc.

In other words, income derrived while you are on vacation.


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## John Cummings (Nov 7, 2007)

Steamboat Bill said:


> Pasive income is a regular income stream not tied to you working for it (in a traditional sense) such as bank interest, stock dividends, pension payments, rent from a property, profit from stocks or bonds, royalities, etc.
> 
> In other words, income derrived while you are on vacation.



Bill,

I am on vacation all the time because I am retired. All of our income is passive by your definition and is well into 6 figures. Neither my wife nor I have to work. As I said, my wife has never worked outside the home.

I was able to achieve a measure of success by a combination of things. What you do with your money is actually more important than how much you make in accumulating wealth. I never got serious about wealth accumulation until I was 45. The bulk of my wealth was accumulated from 1995-2002. My earned income came from my business as a self employed Computer Software consultant ( I was incorporated for 5 years when it was to my advantage ) with my best years in 2001 and 2002 though every year was pretty good. I was able to profit by the stock run-up in the late 90's. I knew it was going to crash so I got out before it did. I didn't quite hit the peak but was close to it. I also made a fair amount on real estate, owning 2 homes in San Diego and the San Francisco Bay area that I sold for considerable gains in 2002 when we bought our present home new in Murrieta. Probably my biggest success was to take my high earning years and invest it rather than living beyond my means which many of my associates were doing. Last but not least, my investment portfolio has increased substantially in the last 5 years.

I use credit extensively when it is to my advantage but never carry any credit card balances nor any other high interest debt. Credit is wonderful if you know how to manage it. Without going into any more details, that is about it. My financial affairs are professionally managed by folks that I have known personally for many years. They are tax experts as well as financial planners so my financial affairs are maximized for tax advantage as well as investment performance. We consult with each other on a regular basis at least twice a week.

Is that enough information for you? I know it is a lot of detail and my purpose is not to brag but to show that anybody can be successful if they are willing to put in the work.


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## Steamboat Bill (Nov 7, 2007)

John Cummings said:


> What you do with your money is actually more important than how much you make in accumulating wealth.
> 
> Probably my biggest success was to take my high earning years and invest it rather than living beyond my means which many of my associates were doing.
> 
> ...



Your situation is similar to mine, except I am no way near retirement years yet. I think your above post can be followed by anyone earning $30k or $3m per year.

I speak to my advisor's about once a week.


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## Lawlar (Nov 7, 2007)

*What Matters Most*

A few of the posts are getting a little cranky.   I would like to take the thread back to the reason why I started it in the first place (but maybe I didn’t do a good job of explaining). 

     What motivated me to start the discussion were the comments of a few of my friends and relatives about how they need to make more money or get better jobs.  For example: A relative gave birth to twins last month.  Unfortunately, the babies were premature and one has been in the hospital for over a month and may need surgery.  Nonetheless, the parents, while worried about their baby, seem obsessed about their jobs, declining home value, and the burdens of raising kids.  At the same time, I have friends that are fixated on how others seem to be acquiring great wealth, and they aren't.  

     I was lucky to be able to retire recently (as long as I live somewhat modestly) and find myself reflecting on my life.   I believe that I spent too much time worrying about my career and acquiring wealth and not enough time with family and friends.  I suspect many of us feel that way now.  

     The statistics I gave about wealth in this country were meant as a way of saying that you probably are doing as well, if not better, as most Americans, so don’t sweat it, and spend more time with friends and family – while they are still here to enjoy.


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## wilma (Nov 7, 2007)

Lawlar said:


> I would like to take the thread back to the reason why I started it in the first place (but maybe I didn’t do a good job of explaining).
> The statistics I gave about wealth in this country were meant as a way of saying that you probably are doing as well, if not better, as most Americans, so don’t sweat it, and spend more time with friends and family – while they are still here to enjoy.



Thank you for bringing this back, I was getting tired of the gloating/bragging!:zzz:


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## Elan (Nov 7, 2007)

wilma said:


> Thank you for bringing this back, I was getting tired of the gloating/bragging!:zzz:



  I agree with you 100%.


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## John Cummings (Nov 7, 2007)

Steamboat Bill said:


> I think your above post can be followed by anyone earning $30k or $3m per year.



I have known many people that have accumulated considerable wealth on very modest incomes and I have also known many that have high incomes and nothing to show for it. For those that think this is gloating or bragging, just don't get it and probably never will.


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## Kagehitokiri (Nov 7, 2007)

John Cummings said:


> For those that think this is gloating or bragging, just don't get it and probably never will.


i dont really get it either, but at least its not as bad as telling people how to spend their money.



John Cummings said:


> I have also known many that have high incomes and nothing to show for it.


i just thank god im only hooked on luxury travel, and nothing else. there are so many things that can can be such expensive habits/addictions/etc.

this is what i want to avoid. i find some of it totally ridiculous (and sad) >
http://elitetraveler.com/press/NYTimes8607doc.pdf



Lawlar said:


> The statistics I gave about wealth in this country were meant as a way of saying that you probably are doing as well, if not better, as most Americans, so don’t sweat it, and spend more time with friends and family – while they are still here to enjoy.


 :thumbsup:


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## Steamboat Bill (Nov 7, 2007)

Lawlar said:


> I believe that I spent too much time worrying about my career and acquiring wealth and not enough time with family and friends.  I suspect many of us feel that way now.



That is usually a deathbed revelation as nobody that sees the bright light says...."Gee I wish I worked longer or harder, instead of spending quality time with my family or on vacation."


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## wilma (Nov 7, 2007)

John Cummings said:


> For those that think this is gloating or bragging, just don't get it and probably never will.



Oh, we get it..Is it possible that the gloaters/braggers don't get it and could consider toning it down a bit. Lots of people are doing well but don't feel the need to constantly parade it around.


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## Kal (Nov 7, 2007)

wilma said:


> ...Lots of people are doing well but don't feel the need to constantly parade it around.


 
You couldn't have said it any more clearly.  I'm a member of that group, but you will never see me post those numbers.  My dear departed Mother always said, "don't break your arm patting yourself on the back".


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## Kagehitokiri (Nov 7, 2007)

IMHO you are bragging about not bragging.

there is a difference, IMHO, between stating facts for discussion, and bragging.

why spend the time criticizing someone even if they ARE bragging? just because its not as bad as criticizing someone because of how they spend their money doesnt mean its not kind of ridiculous.


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## Kal (Nov 7, 2007)

Guilty as charged for not saying what I didn't say.


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## Steamboat Bill (Nov 7, 2007)

Kagehitokiri said:


> IMHO you are bragging about not bragging.



I will try not to brag how funny I think your statement is.


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## Kagehitokiri (Nov 7, 2007)

that was the whole point Bill


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## TerriJ (Nov 7, 2007)

A quote from my grandmother (RIP):

It's not what you make, it's how you spend it.  

I work in the retirement plan industry, and this is so true.


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## Kal (Nov 7, 2007)

We need to check with George Orwell for sage advice....


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## CaliDave (Nov 8, 2007)

I look at John's posts in a completely different way. I think that it shows that its not just the heirs and the lucky, that get rich.. It's also determination and hard work. 
I can't believe how rude some people are. John is always very helpful, humble and has a great heart. Most of the help John provides is via email, he doesn't have to post 1000 times to show how helpful he is. 
Until now, I have never seen John post specifics about his success.. and it seems he only did it now, because he was asked or pushed to do it.

I don't find it to be gloating at all.. People just don't get it. There are always so many people that have to drag the US down and make it seem like the people that work hard and succeed are the bad guys. They are the people that built this country. 

I'm not even close to the category that is being talked about, but instead of sitting here waiting for the government to bail me out or blowing half my paycheck on lottery tickets. I work hard and I know I will succeed. John is an inspiration, I love reading success stories of hard work and determination. 
It seems like most of the stories I see in the news are about how the rich need to pay 100% of the taxes, so irresponsible , lazy people.. Can live without helping themselves. 
Its good to hear that John lived below his means while he was working. It gives me hope, since I try to live the same way, so I can have a secure retirement and I am not a burden on my children.


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## easyrider (Nov 8, 2007)

Kal said:


> Congrats John....but we have heard this about 45 times.



Count me in this group and make it 46


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## Htoo0 (Nov 8, 2007)

I congratulate anyone who has had the fortune to make it. What bothers me is how some who have, seem to think it's easy if you try. I know people who do all the right things to the best of their ability but they never caught the break they needed to really make it. I know those who seem to catch all the breaks and will probably not do well because they can't hold on to it. Fact is, there is more to it than the willingness to work for the American Dream. For every success story there are probably dozens who have done everything they knew how to do but just aren't going to get there. I guess I find it a little insulting when someone implies that if they did it anyone can so it's one's own fault if they didn't succeed. Sometimes that's quite true but many times I don't believe that's the case.


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## chubby (Nov 8, 2007)

I will make a statement about people with money those who brag about money never have it those who sit and never talk about it have it believe it is more times than not true


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## Steamboat Bill (Nov 8, 2007)

CaliDave said:


> I look at John's posts in a completely different way. I think that it shows that its not just the heirs and the lucky, that get rich.. It's also determination and hard work.
> I can't believe how rude some people are. John is always very helpful, humble and has a great heart. Most of the help John provides is via email, he doesn't have to post 1000 times to show how helpful he is.
> Until now, I have never seen John post specifics about his success.. and it seems he only did it now, because he was asked or pushed to do it.
> 
> ...



I also want to thank John.....many people talk, many people walk, but John walks the talk!

I was the one who asked John to post about "How he did it" and everyone can benefit from his experience. If you chose to ignore it...so be it.

A 1,000 mile journey begins with a first step and 90% of success is simply just showing up or getting started.


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## Steamboat Bill (Nov 8, 2007)

Htoo0 said:


> Fact is, there is more to it than the willingness to work for the American Dream. For every success story there are probably dozens who have done everything they knew how to do but just aren't going to get there. I guess I find it a little insulting when someone implies that if they did it anyone can so it's one's own fault if they didn't succeed. Sometimes that's quite true but many times I don't believe that's the case.



Yes, there are many failures, but the opportunity for winning is what makes the American Dream.

My family lived Buffalo since 1880 and my father decided to leave to move to Florida for a better opportunity in 1960's and found it. I too have shared in financial success as a result of this move and have made almost $1m by doing nothing more than buying a house to live in while my grandfathers home in Buffalo has decreased in value so much, it could be paid for by my credit card and not come close to the monthly limit. Is this luck or instinct? My father just got tired of the cold winters.

Success is a result of an odd set of factors that are different for everyone. I have missed many opportunities to invest in Internet companies and some of them are now worth multiple Billions of dollars.....my bad.

I am happy when someone post a roadmap to their success and wish all TUGers would follow their dream. Happiness is more important than financial success.


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## John Cummings (Nov 8, 2007)

I just have a couple of comments. First the title of this thread is:

"Are You Rich Enough (Probably - Hopefully)"

That is a leading question right there. Next Steamboat Bill asked how I did it so I gave a brief picture of my road to success.

Third, I get so tired of all the people that bash America and blame others because they are not able to achieve some level of success. The simple fact is that the individual is responsible for what they achieve. Not the government, not your bartender, nor anybody else.

My purpose in posting this information is to show that If I can do it, so can many others. I want to provide inspiration, not doom and gloom as so many of you post. Nobody is telling anybody how to spend their money. You make choices and hopefully most of them are good ones.

I thank both Steamboat Bill and CaliDave for understanding where I am coming from. They definitely get it. I am positive that they both will be very successful and I wish them well. For the others, you are on your own and can continue complaining which doesn't bother me in the least. If I can provide some inspiration for just one person, I am happy.


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## Elan (Nov 8, 2007)

I'd just like to point out that John openly states that a large part of his success is due to stock market gains.  This part has nothing to do with "hard work".  Is he to be commended for having the ability to save the money he invested?  Absolutely!   Was he lucky to hit the market when it was on one of it's best runs ever?  Absolutely!  So let's not confuse the issue, because if someone else would have been in John's exact shoes, but retired in 1970 instead of the 1990's, things would be entirely different.  I'm not trying to belittle John's accomplishments, but anyone capable of pulling up a historical chart of the DJIA can see the facts.  In the period of 1995 to 2000, the DJIA went from 4000 to 11000 -- almost 200% gain in 5 years!  As a point of reference, in 1970 the DJIA was at 800 and in 1982, the DOW was at 800 -- 0% gain in 12 years.

 Anyone hitting retirement with money to invest _at the right time_ should do well.


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## Steamboat Bill (Nov 8, 2007)

Elan said:


> I'd just like to point out that John openly states that a large part of his success is due to stock market gains.  This part has nothing to do with "hard work".



I disagree with this as investing is not easy and is, in fact, hard work (mentally, not labor intensive). 95% of professional investors can't beat the Dow over a 10 year period.

I personally feel it is better to "work smarter, not harder", but to imply that he got lucky is just incorrect.

There were many things people could invest in in the 70s like real estate, gold, bonds, international, businesses, etc.

Looking back to 2003-2004, I wish I invested my savings in Apple at $6 per share or Google at $85 per share. If I did, I would be fully retired now without a financial worry in the world.

Also, you "incorrectly" interpreted the DOW starting and ending periods during the 70s-80s....many people have made millions off "Stock Dividends" and don't care if the stock goes up or down....but I am sure John knows that already.


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## Elan (Nov 8, 2007)

Steamboat Bill said:


> I disagree with this as investing is not easy and is, in fact, hard work (mentally, not labor intensive). 95% of professional investors can't beat the Dow over a 10 year period.
> 
> I personally feel it is better to "work smarter, not harder", but to imply that he got lucky is just incorrect.
> 
> ...



   The point was, regardless of how you choose to interpret the data (dividend gains would need to be added in both timeframes), that the same investment can yield vastly different returns depending on when the money was invested.  As far as "hard work" your're right -- investing isn't easy.  But the example I'm citing is valid if one were to have simply mimicked (not beaten) the DJIA -- about as easy as it gets in the stock market.


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## Elan (Nov 8, 2007)

Just wanted to reiterate that I'm not in any way attempting to take away from John's financial success.  Way to go John!


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## John Cummings (Nov 8, 2007)

Investing is not just luck. You need to first invest or you will gain nothing. That may sound stupid but many people just sit on the sidelines until it is too late and then they don't get out when they should. I knew that the boom of the 90's was going to crash at least 2 years prior to when it did. Did I have a magic crystal ball. No, it was just a matter of common sense. The dot.coms were due to fail and the P/E ratios were much too high. Speculation was running wild. When you see the speculators coming in, it is time to get out. Anytime there is a big run-up, it will be followed by a sharp decline as in the end the market will return approximately 12% for the long run. There is no guarantee that will happen in the future but it has been historically true. I also saw the housing crisis coming at least 2 years ago. Again that should have been obvious to everybody. With prices rising up to 50% annually in some areas and mortgages being financed with 1% teaser rates, it had to crash.

Since I have retired my investment strategy has changed from growth to moderate growth to counter inflation and income stream. I have guarantees built in that guarantee my income stream even if the market drops drastically. My portfolio is very balanced with international and domestic investments, sector diversification and varied asset classes.

One needs to keep on top of things and apply common sense. I read several business publications and watch the business news on CNBC and Bloomberg everyday. My favorite show is Larry Kudlow's, probably because he is an optimist like I am. As I said earlier, I talk on the phone or in person with my financial adviser at least twice a week. We talk business as well as politics. So to say that it is all luck is not true. There is some work involved in investing wisely. Too me it is not really work because I enjoy business very much.

One last thing, I made a lot of money from my software consulting business that allowed me to invest pretty heavily. A lot of my Friends in the business were also making a lot of money but they were out buying $75,000 automobiles etc. One guy I worked with bought a new $75,000 auto in 1999. I told him that he better get used to sleeping in it because all of this is going to come to an end soon. I told my wife that I need to make as much as I can and invest it wisely because this bubble is going to burst. The ironic thing is that it didn't come to an end for me. Actually 2001 and 2002 were my best years. The high tech industry is booming again and has been for the past couple of years. This time it is sustainable because the wild speculators aren't driving it. By the way, I never graduated from college. In fact I only went to college for one year.


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## Steamboat Bill (Nov 8, 2007)

John Cummings said:


> Investing is not just luck. You need to first invest or you will gain nothing. That may sound stupid but many people just sit on the sidelines until it is too late and then they don't get out when they should.
> 
> I have guarantees built in that guarantee my income stream even if the market drops drastically.



After 4 years of college, 4 years of medical school, and another 4 years of residency, my dad said he got mad every time people said to him "You are so lucky to be a surgeon"...he replied...."Luck had nothing to do with it."

It sounds like you have some type or "annunity" that steps up to higher rates, but can't drop below your locked-in rate...I put my mother into a similar investment and she has been very happy with the results. This also is funny as so many people are anit-annunity that they don't realize new styles are available to guarantee a certain return with safety.


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## AwayWeGo (Nov 8, 2007)

*The Harder I Work The Luckier I Get.*




Steamboat Bill said:


> "Luck had nothing to do with it."


I do not disbelieve in luck.  In fact, I believe that good luck & bad luck are distributed roughly evenly.  What makes the difference is being prepared to take advantage of good luck, when it happens, & also taking steps to safeguard oneself against the inevitable spell of bad luck that's apt to pop up now & then. 

To guard against the harmful effects of bad luck, I can buy timeshares resale, stay clean & sober, obey the law, not run around on my wife, pay my bills on time, get my flu shot on schedule, not run up debt, recycle & re-use, eat sensibly, take my vitamins, not smoke, etc. 

To stay ready to take advantage of good luck, I can be helpful & appreciative & affectionate toward my wife, watch for bargains & be ready to snap them up when they appear, keep my credit rating in good standing, save my money, invest wisely, live modestly (OK*,* semi-modestly)*,* buy low, sell high, pay cash, do repairs, etc., myself when I know how, etc. 

The only honest & fitting response to the rich life I have been given to live is _Gratitude_ *.* 

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## jwq387 (Nov 8, 2007)

*rich enough yet?*



John Cummings said:


> Investing is not just luck. You need to first invest or you will gain nothing. That may sound stupid but many people just sit on the sidelines until it is too late and then they don't get out when they should. I knew that the boom of the 90's was going to crash at least 2 years prior to when it did. Did I have a magic crystal ball. No, it was just a matter of common sense. The dot.coms were due to fail and the P/E ratios were much too high. Speculation was running wild. When you see the speculators coming in, it is time to get out. Anytime there is a big run-up, it will be followed by a sharp decline as in the end the market will return approximately 12% for the long run. There is no guarantee that will happen in the future but it has been historically true. I also saw the housing crisis coming at least 2 years ago. Again that should have been obvious to everybody. With prices rising up to 50% annually in some areas and mortgages being financed with 1% teaser rates, it had to crash.
> 
> Since I have retired my investment strategy has changed from growth to moderate growth to counter inflation and income stream. I have guarantees built in that guarantee my income stream even if the market drops drastically. My portfolio is very balanced with international and domestic investments, sector diversification and varied asset classes.
> 
> ...



I agree with John's take on accumulating wealth. I just started REALLY putting together a good plan at age 47. I am not a high wage earner: work for the Post OFfice, and my wife is an office manager at an insurance firm. I use a financial planner/technical analyst and follow his recommendations. I have been successful in investing my retirement portfolio by following his advice. The key is to be as informed as humanly possible about your financial future, and follow what successful people are doing. The mainstream media, your relatives, your friends, may have good intentions, but your have to do your own due diligence in order to put together a financial plan that works for you.  Too many people(including me, until about 3 years ago) are reactionaries when it comes to stock/mutual fund investing of their retirement accounts. We congratulate ourselves when the market skyrockets for a few years, then rationalize our lack of control as "bad luck" when the market wipes away most of our gains in just 18 months. I got off that cycle, and took control of my financial future, trusting, and paying an advisor who has done well for me in good markets and bad.


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## Mel (Nov 8, 2007)

I think the biggest problem in this country is people living beyond their means, feeling that they should be entitled to everything.  Very few people save, and most end up in a difficult situation if they lose their job even temporarily.

I see this same attitude among my daughter's friends.  Their parents give in to every whim, wanting to give their kids everything they didn't have as kids.  But I think they are doing them a diservice.  I don't buy everything my kids want just because they ask.  They don't have gameboys or Nintendo (or any game system attached to the television).  We have one computer for the children to share, and rarely allow them to use ours; they can work out time to share.  What we do give them is experiences - we take them on vacations where they can learn about the world around them by experiencing it.  There have been times when cashflow was tight, and we cut back - local trips instead of mexico, fewer meals out on vacation.  When they want to spend their money, they ask for help finding the best price, and often choose to save their money instead.  My 5YO is saving pocket change to pay for her ticket to Disneyland in the spring - by her choice.  I will make up the difference, but saving to "pay her own way" is important to her. 

I suspect that most TUG members are more like our family than like many of those in my neighborhood.  Most of us bought our timeshares to save money, and try to get the most for what we have.  Timeshare developer have a target audience, based on income.  Most who qualify are in the top 20-30% of earners, so I would expect most of us here to be among that group.  Those who bought resale might not be in the top 20% income-wise, but most are probably up there among the "savers" because the thing that drove them to find a bargain timeshare also drives them to look out for their financial future.

I know a few people I would consider "rich" and they got there by saving and scrimping.  They understood the need to save for a rainy day, so they would remain comfortable, rather than simply living it up now.  They have taken "risks" with their investments, but always calculated risks - as has been described here.  Common sense works quite well, as demonstrated above - we all know tech stocks were way too high, and if we paid attention we got out at the appropriate time.  If not, hopefully we learned to pay more attention next time.  What many often call good luck is simply paying better attention.


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## normab (Nov 8, 2007)

I think that Mel summed up what many responses in this thread are all about.  One doesn't need  to make tons of money to be a disciplined saver.  And one doesn't need to be rich to invest in the stock market--mutual finds help you do it with much less money and risk.

The book titled "Millionaire Next Door" was my revelation (several years ago) and changed the way I thought about savings and growing wealth.  All the people chronicled in the book just had a savings goal that they were faithful to and did not spend every raise they got.  They did not have that "entitled" attitude which makes so many overspend and put themselves in ridiculous amounts of debt.  

I always encourage anyone who is not where they want to be financially, or who doesn't know how to figure where they stand with respect to saving for retirement, to read the book.  David Bach also has written several books that are no-nonsense books on how to trim spending and accumulate wealth.  I just wish personal finance was a required course in High School. People need to learn about finances when they are young and their savings have time to grow.  I would have liked to learn more at a younger age--then I would be retired NOW!


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## Htoo0 (Nov 9, 2007)

I too wish they taught the things one really needs to know in school. (I suspect they don't because if we all knew it our economy couldn't handle it.) I used to laugh when they created IRA's and advised everyone to fully fund them so we would all be millionaires when we retired. If everyone did that a loaf of bread would likely cost $1,000.
I certainly don't think anyone owes others success. And again cudos to all who have made it, I'm not complaining about anyone's success. I think I'm on my way as I've been saving even when I couldn't really afford it. I figured I couldn't afford not to either. My point was it bothers me when people who have made it for whatever reason- hard work, dedication, good fortune, connections, etc. act as though anyone who wants to be successful can be if they try. I don't know if John or anyone else posting here fits that description and I apologize that it appeared as such. I do know several who do believe that however and it annoys me because I also know a lot of wonderful people who who are doing their best and will probably never realize the financial success others (sometimes) obtain so easily. (I'm reminded of an old story- It's easy to make a small fortune-provided you start with a large one.)


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## John Cummings (Nov 9, 2007)

Steamboat Bill said:


> It sounds like you have some type or "annunity" that steps up to higher rates, but can't drop below your locked-in rate...I put my mother into a similar investment and she has been very happy with the results. This also is funny as so many people are anit-annunity that they don't realize new styles are available to guarantee a certain return with safety.



You are right about being a form of an annuity. Yes, many folks are anti-annuity and yes, there are new forms of annuities that are basically mutual funds with various options for protecting your investment. The one that I have is called American Skandia from Prudential. Check it out. It is very good. It grows with the market or a minimum of 5%, whichever is greater. It adjusts daily until you start to draw income from it. Everyday the benchmark rises either the amount of increase in the investment or at an annual rate of 5%. After you start to draw money then it adjusts quarterly. Unlike an annuity it also is a Mutual fund and offers the same benefits. American Skandia is just 25% of my portfolio. It has increased in value by 32% over the past 2 years. I also have other investments with guaranteed returns that are not annuities.


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## John Cummings (Nov 9, 2007)

Htoo0 said:


> ...(I'm reminded of an old story- It's easy to make a small fortune-provided you start with a large one.)



Just for the record, I started with zero and never received any inheritance or anything like that. For the record, I have made mistakes in my life. We all make mistakes and hopefully we learn from them and move on. The biggest mistakes I probably made were owning our own restaurant in San Jose, CA and selling our house in the SF Bay area in 2002. We didn't fail in the restaurant business but it is a very tough business and I could have done better in another endeavor at the time. However, it was a good experience. I should have waited to sell my house as it went up another 40% in the next 3  years. I was sure it would drop with the collapse of the high tech industry in Silicon Valley with the unemployment rate jumping from 1.2% to 8.5%. Oh well, you can't win them all.


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## LisaH (Nov 9, 2007)

John Cummings said:


> The biggest mistakes I probably made were...selling our house in the SF Bay area in 2002. I was sure it would drop with the collapse of the high tech industry in Silicon Valley with the unemployment rate jumping from 1.2% to 8.5%.



I remember that period well. Our neighborhood has lots of people working in high tech industry. During that period, about 10% of the parents in my kids schools were unemployed including me. All of a sudden, you saw more dads joining their kids for field-trips than ever before. It was indeed a very stressful yet interesting period of time. However, as John pointed out, the real estate correction didn't happen until late 2005-2006, and it continues to this date.


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## John Cummings (Nov 9, 2007)

LisaH said:


> I remember that period well. Our neighborhood has lots of people working in high tech industry. During that period, about 10% of the parents in my kids schools were unemployed including me. All of a sudden, you saw more dads joining their kids for field-trips than ever before. It was indeed a very stressful yet interesting period of time. However, as John pointed out, the real estate correction didn't happen until late 2005-2006, and it continues to this date.



Lisa,

Are prices dropping now in Silicon Valley? We lived in Sunnyvale for all of 2006. I was on a software consulting gig there and we rented a corporate apartment at St Francis Arms in Sunnyvale. I wouldn't expect prices to drop very much in the SF Bay area due to the booming high tech industry and the chronic shortage of housing. House prices were still climbing though the rate of increase had slowed down.

House prices have dropped substantially here in the Inland Empire in Southern California.


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## TerriJ (Nov 9, 2007)

I see some common themes in these posts and with Tuggers overall:

 - lots of savers
 - lots of awareness about living below our means
 - lots of people working hard
 - starting out with nothing (we sure did)
 - some mistakes are made, such as buying from the developer, but we learn from our mistakes

I have enjoyed reading this thread and it gives good food for thought.  One basic rule we have always followed is to save by paying yourself first, no matter what.  Then we would figure out the other stuff, and as mentioned earlier there are always lean times.


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## Htoo0 (Nov 9, 2007)

John Cummings said:


> Just for the record, I started with zero and never received any inheritance or anything like that.
> 
> I wasn't implying anything different. From your posts I assumed you did it on your own. I'm well aware there are some who rise from dirt-poor families and end up quite weathy and vica versa. But for most who didn't come from a higher tier background it seems much more difficult to advance. They can't seem to discover the opportunity to make an upper level living. Even with a college education I know people hard-pressed to earn more than mid 5 figure incomes and it's hard to become rich on that. (Not that it can't be done)


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## caribbeansun (Nov 9, 2007)

You should always ask yourself why, if your adviser is so good, do they need to be an adviser?

I think you have some more work to do on the due diligence piece and educate yourself about the markets so that you'll know when your adviser is recommending something that doesn't fit within your personal risk tolerances.




jwq387 said:


> I agree with John's take on accumulating wealth. I just started REALLY putting together a good plan at age 47. I am not a high wage earner: work for the Post OFfice, and my wife is an office manager at an insurance firm. I use a financial planner/technical analyst and follow his recommendations. I have been successful in investing my retirement portfolio by following his advice. The key is to be as informed as humanly possible about your financial future, and follow what successful people are doing. The mainstream media, your relatives, your friends, may have good intentions, but your have to do your own due diligence in order to put together a financial plan that works for you.  Too many people(including me, until about 3 years ago) are reactionaries when it comes to stock/mutual fund investing of their retirement accounts. We congratulate ourselves when the market skyrockets for a few years, then rationalize our lack of control as "bad luck" when the market wipes away most of our gains in just 18 months. I got off that cycle, and took control of my financial future, trusting, and paying an advisor who has done well for me in good markets and bad.


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## pgnewarkboy (Nov 9, 2007)

*Very Nice - But*



John Cummings said:


> I would like to add one of the very few positive notes to this thread. We are definitely living the American Dream. I am retired and my wife has never worked outside the home. We are in the top 10% income and top 5% net worth. We started with nothing and I have earned every penny we have. I know some of you do not like to hear success stories but there are some of us around. The US is truly the land of opportunity if one is willing to take advantage of the opportunities.



John,

There are many, many, people in this country who cannot take advantage of all these opportunities for many reasons. In a nation that worships money above all else, that causes injustice.  Let me be clearer, having money is not a virtue.  I am glad that you earned every penny you made and saved it.  It doesn't make you better than anybody else.


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## pgnewarkboy (Nov 9, 2007)

*Your Annuity*



John Cummings said:


> You are right about being a form of an annuity. Yes, many folks are anti-annuity and yes, there are new forms of annuities that are basically mutual funds with various options for protecting your investment. The one that I have is called American Skandia from Prudential. Check it out. It is very good. It grows with the market or a minimum of 5%, whichever is greater. It adjusts daily until you start to draw income from it. Everyday the benchmark rises either the amount of increase in the investment or at an annual rate of 5%. After you start to draw money then it adjusts quarterly. Unlike an annuity it also is a Mutual fund and offers the same benefits. American Skandia is just 25% of my portfolio. It has increased in value by 32% over the past 2 years. I also have other investments with guaranteed returns that are not annuities.



Did you read and understand your entire contract or just the summary explanations that are not binding?  The experts I have read say that these variable annuitiy contracts are virtually impossible to understand.


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## caribbeansun (Nov 9, 2007)

I guess I'm in that camp to a large degree.  I believe we all make choices along the way, starting very early in life.  You choose if you work part-time in high school to save for college, you choose to work extra hard on your home work in high school to get good grades and/or win scholarships.  You choose your major in college or university and so on throughout your life.

For people that are disadvantaged by physical or mental handicaps this is obviously beyond their control and those people do need assistance and can't ultimately have 100% control of their destiny (some can but many can't).  To a lesser degree financial disadvantage can also play a role for those at the bottom end of the spectrum earlier in life - I'm thinking this would apply to about 10-15% of the population and I do believe assistance for those is appropriate. 

I don't think it's easy for the vast majority of people out there.  To suggest it's easy or luck that gets people where they are is insulting to everyone that's worked their butt off to achieve something.  To think that you are suffering from bad luck or that it's tougher for you than the next guy - well, take a look at the decisions you've made and see where if you'd changed a couple along the way how things might be different.  Of course, it's never too late to change and start taking ownership of your life and making good decisions.  Lets not take the "easy way out" and subscribe to luck or preordained outcomes - I for one don't buy into that.



Htoo0 said:


> My point was it bothers me when people who have made it for whatever reason- hard work, dedication, good fortune, connections, etc. act as though anyone who wants to be successful can be if they try. I don't know if John or anyone else posting here fits that description and I apologize that it appeared as such. I do know several who do believe that however and it annoys me because I also know a lot of wonderful people who who are doing their best and will probably never realize the financial success others (sometimes) obtain so easily. (I'm reminded of an old story- It's easy to make a small fortune-provided you start with a large one.)


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## pgnewarkboy (Nov 9, 2007)

pgnewarkboy said:


> Did you read and understand your entire contract or just the summary explanations that are not binding?  The experts I have read say that these variable annuitiy contracts are virtually impossible to understand.




I forgot to state the old wisdom "In God we trust-all others pay cash."


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## CMF (Nov 9, 2007)

*Not Rich.*

Wealth is a relative thing - of course.

For me, being rich means not having work.  I expect to work at least until age 65, or perhaps age 67, to meet my personal and family expectations and goals for retirement.  All this even though my family meets the high end benchmarks in the OP.  

Charles


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## gsturtz (Nov 9, 2007)

I'm sure it varies wildly, but what are some "rules of thumb" you use for retirement planning?

For those not yet retired, what % of your income do you save? (me, ~17%, probably should be closer to 25%)

At what age will you/did you retire.  (My goal is 58, but could be as early from 55 if I meet my $$ goals.)  SS is not included in any of my planning figures. (just to be conservative)


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## pgnewarkboy (Nov 9, 2007)

*Making it on your own- a narrow minded perspective*

Many of the posters are very proud that they "made it on their own."  I guess you don't realize that NOBODY makes it on their own . It takes a whole society for anybody to make it.  It takes a local government, federal government, army, school system, banking system with safeguards, friends or relatives who provide moral support, constitution of the US that give you the right to "make it on your own".  People gave their lives for that.  The bottom line is that you need other people who are buidling bridges, delivering mail, fixing power lines, making cars, buidling roads and making inventions that spur the economy.  We benefit from entertainers and other creative people who provid stress relief and fun and beauty. You need a functioning and effective world banking system and health system.  You need doctors, lawyers, engineers etc. All working together so we can all make a society that provides for its people.  We all benefit from the efforts of others.

Why don't we stop all this ego building backslapping and realize that we are not alone and we owe much to others.


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## Steamboat Bill (Nov 9, 2007)

pgnewarkboy said:


> John,
> 
> There are many, many, people in this country who cannot take advantage of all these opportunities for many reasons. In a nation that worships money above all else, that causes injustice.  Let me be clearer, having money is not a virtue.  I am glad that you earned every penny you made and saved it.  It doesn't make you better than anybody else.



Nobody here (especially John) has posted that they think they are better than anyone else. 

I find this thread fascinating and enjoy reading about the success of other people. I am glad to share some of my knowledge (financial or otherwise) and I am always happy to learn something new.

I personally feel the USA has the greatest opportunity for EVERYONE to improve their lives. If you become rich....great. If you are happy....even better. Nowhere else in the world has so many people started with nothing and created great wealth. 

Look at Mark Z of Facebook.com....he is now worth $5 billion and is only 23yo. He did it by creating a great web site. Too bad TUGbbs.com is not worth that kind of money.

I would argue that our entire nation does not worship money above anything else.


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## pgnewarkboy (Nov 9, 2007)

*Smugness*

I don't know john and  my comment was indeed a personal attack and that was wrong on my part.  I do feel, however, that this "made it on my own business  IN GENERAL and not pointing to any specific individual can reflect an undeserving smugness.  There is a certain uncharitable and judgmental tone to the statement.

I have no problem with tips and financial advice.


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## Jya-Ning (Nov 9, 2007)

I feel very lucky that my parent did not force me or make some decision for me that will affect me later on while I have no ability to make that kind of decision.

I feel very lucky that although I grow up in a semi-dictatorship country, the year I grow up, the country is booming and take the US system, so my common sense is similar to US's common sense.

I feel very lucky that my parents provide me enough support to allow me to develop on my own interest and when I done with it, I can start from zero.

I feel very lucky that the country has stead growth, so when my parent grow old, but before I can finanicial able, they saw their wealth get accumlated, and does not need me to carry their load.

I am terrified to wish that I can do the same to my kids.
I do feel bless that in today's enviroment, in this country, you can do almost any kind of investment you can think of, and you can get the risk level that you can justify.

And I do feel bless to have my health and my family's health.

I am pretty sure I was very powerless during the time when I start to figure out this whole financial issues, and what I like and can do with it.  But I am lucky enough to be in an enviroment that do provide enough opportunity for sucess.

Besides these, I believe I worked hard enough, and deserve everything I earn.  And know I can now choose to take the risk level that I feel comfortable to take to see my wealth growing.

Jya-Ning

ps. I have no doubt that if I have to go through different route, then I will take different approach and try my best to success in that route.  Since I only life the past once, so can not tell if I will be success or not, or if I will be better than I am today or not.  For now, I can just assume I will no matter what I choose.


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## Tom52 (Nov 9, 2007)

*Accumulating wealth and early retirement*

I am surprised by some of the harsh comments in this topic.   For anyone interested in a site geared towards financial independence which can allow the possibility for early retirement I suggest you check this out.

www.early-retirement.org

These are friendly people that are happy to offer advise and tell of their experiences on the hard road to financial independence.  They applaud financial success such as John's and I find that attitude very motivating. 

Now whoop on me if you want for saying this. Can anyone deny that in their own life experience, for every tragic story where certain individuals, due to circumstances beyond their control will never achieve the American Dream, there is a like number of stories where people have the opportunity to eventually reach financial independence but choose to live for the day?   Most of the people I know make a decent wage but have made the decision to spend every dime and then some.  I hear every day, Oh, I plan to work until I die so why save?  Well, they may want to work but they may not be able to.  You can't maintain the same lifestyle if you only have SS.

I say pay yourself first.  You know the old saying a penny saved is a penny earned.  Well,  I say a penny saved is better than a penny earned because I don't have to pay tax on a saved penny.


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## Steamboat Bill (Nov 9, 2007)

pgnewarkboy said:


> I don't know john and  my comment was indeed a personal attack and that was wrong on my part.  I do feel, however, that this "made it on my own business  IN GENERAL and not pointing to any specific individual can reflect an undeserving smugness.  There is a certain uncharitable and judgmental tone to the statement.
> 
> I have no problem with tips and financial advice.



There it is...you admitted that you made a personal attack on John!

The problem I see with most published financial advice is that is is NOT coming from successful people (like John) and comes from someone trying to make a profit off their advice. 

When I asked John to share with TUGers how he did it....he agreed and now some people think he is acting smug?...that is just plain wrong.


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## jwq387 (Nov 9, 2007)

caribbeansun said:


> You should always ask yourself why, if your adviser is so good, do they need to be an adviser?
> 
> I think you have some more work to do on the due diligence piece and educate yourself about the markets so that you'll know when your adviser is recommending something that doesn't fit within your personal risk tolerances.



I disagree, respectfully. I have done my due diligence, and am happy with the recommendations and the results. As far as why he needs to be an advisor, well maybe he doesn't.  I haven't asked.  He has a PHD in economics, and has been doing technical analysis for 12 years. I have another acquaintence(not my financial advisor) who also has his PHD in economics and is the foreign currencies markets director for Price Waterhouse. No need for concern.


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## Kagehitokiri (Nov 9, 2007)

people in finance can be very well compensated.

a handful of HF managers have made $1B+/yr.

large firms know there are smaller private family-oriented firms that hire such people to run a fund; and families that hire them as a family office manager. (manage finances, household, travel, etc) Family office managers have a median income of $2MM/yr when given participatory compensation, where they are allowed to invest their own money with the family(s) they are advising.


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## vivalour (Nov 9, 2007)

TerriJ said:


> A quote from my grandmother (RIP):
> It's not what you make, it's how you spend it.
> I work in the retirement plan industry, and this is so true.



And from my grandmother (RIP): "Money doesn't ask who it's going to."


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## Steamboat Bill (Nov 9, 2007)

vivalour said:


> And from my grandmother (RIP): "Money doesn't ask who it's going to."



I don't get that quote....perhaps it is a Canadian saying...please translate the meaning to me.


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## Kagehitokiri (Nov 9, 2007)

like money doesnt care how you spend it, so YOU have to care? or be mindful of it.

> "It's not what you make, it's *how* you spend it. "


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## CMF (Nov 9, 2007)

*Actually, the quote maybe originally from Sierra Leone*

MכNI Nכ DE AKS IN KכMPIN USAI I KכMכT.

"Money doesn't ask its fellow money where it comes from."

Charles


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## AwayWeGo (Nov 9, 2007)

*Mr. Micawber's Advice To David Copperfield*

"My other piece of advice, Copperfield," said Mr. Micawber, "you know. Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery." 

( from _David Copperfield_*,* by Charles Dickens*,* Chapter 12 ) ​
-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## frenchieinme (Nov 9, 2007)

*Some people would...*



Steamboat Bill said:


> If you invested $833,600 in a 5% CD (assuming you want to be retired), you will only produce $41,680 per year (then you pay taxes of at least 30%) nets you about $30,000 per year.
> 
> Thus, I would hardly consider someone having $833,600 (and no longer working) to be classified as rich. It is a nice number, but does not allow an opulent lifestyle. In fact, many retired government employees get over $30,000 per year in retirement benefits.



The working poor would!!! 

frenchieinme


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## vivalour (Nov 9, 2007)

Steamboat Bill said:


> I don't get that quote....perhaps it is a Canadian saying...please translate the meaning to me.



(Not an esp. Canadian saying -- my grandmother was an immigrant from Europe.) I think the idea was not to be overawed by those with lots of money. One of her sons paid his way through university tutoring a younger student  whose family was one of the wealthiest in Canada -- he was not the brightest, but inherited a ton of money. He was smart enough, though, to become an international philanthropist and not fritter it all away.


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## TerriJ (Nov 10, 2007)

Once again, enjoying the topic and all the lively discussion.  One other idea/tip activity I have always enjoyed doing.....I really like to listen to and read finanical information and topics.  I handle our family investments and like to learn new things.  Some of my favorites are Bob Brinker's money talk radio program on Sunday afteroons and Suze Orman's TV show on Saturday night.  My favorite part of Suze's show is the "Can you afford it" section.  It's very interesting what people want to buy.  I also enjoyed the concepts in The Millionaire Next Door and bought this for both our grown kids.

Please keep sharing!


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## caribbeansun (Nov 10, 2007)

Fair enough - my comment should have been worded in the general rather than more directed towards you.

My concern is for people (not necessarily you) that do some up front research and find an adviser but then feel their work is done.  I would suggest you need to be diligent throughout and monitor your adviser's performance and monitor the investment recommendations against your own risk profile to ensure that they are not doing things against your stated objectives.  Consider it to be healthy skepticism.

Cheers! 



jwq387 said:


> I disagree, respectfully. I have done my due diligence, and am happy with the recommendations and the results. As far as why he needs to be an advisor, well maybe he doesn't.  I haven't asked.  He has a PHD in economics, and has been doing technical analysis for 12 years. I have another acquaintence(not my financial advisor) who also has his PHD in economics and is the foreign currencies markets director for Price Waterhouse. No need for concern.


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## John Cummings (Nov 11, 2007)

pgnewarkboy said:


> John,
> 
> There are many, many, people in this country who cannot take advantage of all these opportunities for many reasons. In a nation that worships money above all else, that causes injustice.  Let me be clearer, having money is not a virtue.  I am glad that you earned every penny you made and saved it.  It doesn't make you better than anybody else.


 I never said that I was better than anybody else. Pay attention to the title of this thread. Injustice is not caused by people being financially responsible.


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## frenchieinme (Nov 11, 2007)

*Unbelievable...*



Lawlar said:


> I think TUGGERS will find this interesting:
> 
> Here is the breakdown on household family incomes:
> 
> ...



What is really shameful and downright unfair is NEVER does it appear has so much $$$ been made in a generation with such little amounts being filtered to the levels 1!!! 

We are literally destroying a middle class right before our eyes.  Too many people are too rich to be poor and too poor to be rich. 

frenchieinme


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## "Roger" (Nov 12, 2007)

This article was written in late 1996, but still relevant.  It described what it took back then to be in the top 1% (less than what you might have thought) and the attitudes of those who were "one percenters." Long, but very interesting.

One percenters


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## TerriJ (Nov 14, 2007)

Definitions I heard in a  savings seminar yesterday:

"Affluent"
Investable assets of $500,000 to $2.5M
Income of $100,000 to $250,000 

"High new worth" is above these levels.


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