The Middle Class Mind / The Wealthy Mind

Originally Posted by Lighthouse

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Professionals sell their time. Aside from, say, personal injury lawyers, I get the impression that the inherent restraint of time is a, well, a restraint on one's wealth potential.

The professionals that get rich buy a bunch of other professional's time and then resell it at a profit.

Originally Posted by munchausen

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The professionals that get rich buy a bunch of other professional's time and then resell it at a profit.

You mean like leveraging the work down to associates or non-shareholders, paying the salary and pocketing the difference?

Aw, I opened this thread looking forward to a comparison of the mindset of middle class vs wealthy people, not a "what's the best way to get rich" thread. I'm going to a halfway decent school for undergrad, so I'm in touch with kids from all levels of society.

The middle class students I know put so much pressure on themselves. So many conversations that go: "Well, I really like [x], but I'm trying to get into medical school. Maybe I can do [x] as a hobby."

The few old money students I know have an odd regard for their future. Taking up the family business seems like an inevitability, so they have this attitude that is carefree and focused at the same time. The poor friends I have take whatever classes they are interested in without being embarassed about it.

Originally Posted by mellow

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Aw, I opened this thread looking forward to a comparison of the mindset of middle class vs wealthy people, not a "what's the best way to get rich" thread. I'm going to a halfway decent school for undergrad, so I'm in touch with kids from all levels of society.

No, young one, take this thread to that place.

Originally Posted by slycedbred

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You're completely missing the point, brah

Actually I am not - he just didn't explain himself well enough.

Hi folks- first post here

Originally Posted by cross22

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500k may be a bit high, but there are plenty of people who earn high salaries and aren't wealthy. They live in slightly better homes, in better parts of town, drive later model cars, and send their kids to better/private schools. However, they would lose their home and everything else if they lost their jobs and couldn't find another one for an extended period of time. A wealthy person would be able to maintain a reasonable lifestyle without the need to earn wages.

I agree with this. It's all relative. What you think you need will likely increase as you become more affluent. That's human nature. If you stay hungry you'll get richer but how rich do you want to be? Richer than your peers probably? But so rich that you can't hang around with the same friends you used to? If I had to put a figure on it, I would say and income of $500K a year would provide a comfortable lifestyle but then you'll probably want that little bit more.
Will you have time to enjoy it. I've never been afraid to spend money, and I buy the stuff I want. I reckon a lot of the uber-rich are so wrapped up in the business of making money that they don't have time to enjoy it. It's definately better to have some wealth. Especially if you appreciate the finer things in life, but how much do you need to be happy?

Remember what Tyler Durden said- "The things you own end up owning you"

Double post

Originally Posted by Freewheeler

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Actually I am not - he just didn't explain himself well enough.

It was perfectly clear to everyone else. You just became argumentative over semantics for no discernible reason.

Originally Posted by Don Carlos

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A former titan of my particular industry put it this way: "Nobody ever got rich off a salary. No matter how high the salary." If you want to get rich -- I mean ****-you-money rich -- then you need to own something. That can be real property, it can be intellectual property, it can be a company, it can be a monetized idea, it can be patents, it can be a personal brand, it can be privileged access to something desirable and in short supply, or whatever the case may be. But ownership confers wealth. More specifically: ownership of something others want to buy* from you confers wealth. In this sense, no, trying to maximize a corporate salary and squirrel away as much money as you can save over 30+ years is not going to make you wealthy. If you want to become really wealthy, you need to take risk and work your ass off to realize the return on that risk. *Whether literally or figuratively.

Originally Posted by Don Carlos

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Spend less. Invest more. Most people get tripped up on the "invest" part, though. Get-rich investing is not socking it all diligently into a 401k. Get-rich investing means strategically investing that money into something like a startup business.

Originally Posted by Manton

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The distinction between wealth and a high income is true, of course, and often overlooked but I think the quote is wrong, or out of date. At the top end in corporate America--and I don't just mean CEOs but also the top tier of executives--it is quite possible to get rich on a salary (plus bonus plus stock grants). These people can make millions per year, live lavishly, and still have plenty left over to amass tens of millions over a career. In banking, the money is bigger and the number of people who earn big time are more.

Originally Posted by munchausen

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The professionals that get rich buy a bunch of other professional's time and then resell it at a profit.
These quotes all capture parts of my opinions on the topic. In abstract, very general terms, small-timers convert their time into money (i.e. they earn a salary). Because everyone's time is limited, this puts a ceiling, perhaps a very high one, but a ceiling nonetheless, on wealth that can be amassed this way. It is possible to raise this ceiling and become rich by converting other people's time into money (e.g. managing others or owning your own business) or converting your own money into more money (e.g. investing, including investing in your own business). To become truly mind-bogglingly wealthy, find a way to use other people's money to make money. The further you progress toward this last model and the better your plan for implementing it, the wealthier you will become.

Originally Posted by Vidal_Balloon

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If I had to put a figure on it, I would say an income of $500K a year would provide a comfortable lifestyle but then you'll probably want that little bit more.

+1

I heard somewhere that you should work out a rough target wealth number, and add about 20% (hedging and whatnot), and never carry a credit card balance. But "wealth " is subjective, as many have pointed out.

I would consider myself "wealthy" if my house was entirely paid for; I could take a month-long vacation whenever I wanted without having to worry about bills; if I could buy whatever I wanted without any worries; and if I did not have to work for someone else to survive (i.e., live off of royalties, occasional freelance work, etc. - working for myself or loaning my talents to someone else, but retaining full control).

But then again I'm not interested in sports cars, mansions, or cottages; I don't want a plasma screen TV or a patek philippe watch; and my shoe habit in my (current) wildest dreams might be one pair of bespoke per year. YMMV

Originally Posted by Freewheeler

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I wish you could add some substance to your own argument. I shot bullet holes through your idea of logic and now you have nothing.

Bro, I don't even like DC but he just took you out behind the woodshed and beat you like a red headed step child.

Originally Posted by Geoff Gander

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I don't want a plasma screen TV

At some point, this analogy is going to have to die...can you even buy non-flat panel tv anymore?

Originally Posted by cross22

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500k may be a bit high, but there are plenty of people who earn high salaries and aren't wealthy. They live in slightly better homes, in better parts of town, drive later model cars, and send their kids to better/private schools. However, they would lose their home and everything else if they lost their jobs and couldn't find another one for an extended period of time. A wealthy person would be able to maintain a reasonable lifestyle without the need to earn wages.

It makes me so happy to see people post like this. My work here has paid off.

Btw, OP, did you just read Rich Dad/Poor Dad? The first post sounds like a summary of him.

Originally Posted by otc

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At some point, this analogy is going to have to die...can you even buy non-flat panel tv anymore?

Does anyone know if 3-D hologram television is under development? Full-sensory experience VR in your living room?