When a Million Dollars was serious wealth

[street]

This data shows that you would need 4.4 mill to be in the top 1% in the US. I could see that number being true, if said in the world.
https://marker.medium.com/it-takes-m...1-202e2cbb8c18

[finnski1]

yeah I saw $11 million as well for top 1% in US and $4.4 million for top 1% in the world.

[street]

^ thanks. I might have missed that in this article but that sounds more like it.

[braumeister]

If you don't have a superyacht with a helipad on it, you're not really that impressive any more.

[CSdot]

One nice thing to be said for having $1M+ invested, zero debt, and a paid for house, is your nest egg seems to want to grow on its own. While that is not always true (dot com, 2008, March 2020), the times when it is true is a thing to behold.

[youbet]

Quote:

Originally Posted by CSdot One nice thing to be said for having $1M+ invested, zero debt, and a paid for house, is your nest egg seems to want to grow on its own. While that is not always true (dot com, 2008, March 2020), the times when it is true is a thing to behold.

Even better than " $1M+ invested, zero debt, and a paid for house," would be $1M+ invested, zero debt, a paid for house, a thousand acres of prime farmland leased out, a paid for apartment complex in a high tier area being professionally managed, an exotic car collection and a trust fund spouse!

But, yes, having enough passive income to cover your spending desires is a good thing...... !

[rodi]

I remember about 15 years ago when a friend laughed and said she and her husband were 'nega-millionaires'. They had invested in several rental or development properties and owed more than a million bucks. The idea was shocking to me, but I liked her attitude.

Fwiw - she pulled the plug and retired in her mid 50's. They've sold or paid off the properties they still own. Her husband still works - but choice. So owing that million, being nega-millionaires, was a good financial move for them.

[MRG]

Quote:

Originally Posted by street This data shows that you would need 4.4 mill to be in the top 1% in the US. I could see that number being true, if said in the world. https://marker.medium.com/it-takes-m...1-202e2cbb8c18

It's interesting, to me anyway, how "they" determine household or even individuals worth. During my programming career I worked on two large projects the goal was to link investors accounts together, saving fund/investment companies millions in postage.

This was MUCH more difficult than you might think; at least programmatically. You'd think comparing the accounts registration would be a piece of cake. Yeah I thought so too. Turns out over years of software changes and conversions from different systems of record made that hit or miss. Ignore nulls and make them equal to spaces? Maybe. What about CaSe? Middle initials? How many false links would have to be resolved if you actually linked the accounts based on what your program was coded to do. Choose to error on the side of safety? Want to have people combine the millions of accounts manually? That's why they funded the project.

Of course just aggregating numbers together, even if wrong, would be easier.

[Out of Steam]

By 2040, we'll be talking about trillionaires.

[youbet]

Quote:

Originally Posted by rodi I remember about 15 years ago when a friend laughed and said she and her husband were 'nega-millionaires'. They had invested in several rental or development properties and owed more than a million bucks. The idea was shocking to me, but I liked her attitude. Fwiw - she pulled the plug and retired in her mid 50's. They've sold or paid off the properties they still own. Her husband still works - but choice. So owing that million, being nega-millionaires, was a good financial move for them.

I get the humor in the "nega-millionaire" nomenclature, but debt doesn't subtract from your net worth. For example, if your friends properties were conservatively appraised at $1.5 million and they owed $1 million, then they'd be able to include $500k in their net worth (not subtract $1 million).

Why were you shocked?

[unclemick]

Quote:

Originally Posted by rodi I remember about 15 years ago when a friend laughed and said she and her husband were 'nega-millionaires'. They had invested in several rental or development properties and owed more than a million bucks. The idea was shocking to me, but I liked her attitude. Fwiw - she pulled the plug and retired in her mid 50's. They've sold or paid off the properties they still own. Her husband still works - but choice. So owing that million, being nega-millionaires, was a good financial move for them.

Grin. Several years ago DW's Brother talking about a local farmer said he was rich cause last year he borrowed $4 million in petty cash to pay his help and other costs til the crops were sold.

Heh heh heh - In the years since starting investing (1966) crossing $1 million was fun. BUT crossing $1 million in the negative direction - REALLY got our attention.

[friar1610]

Quote:

Originally Posted by Amethyst I worked with some people who were almost certainly 1%ers, at least income-wise. They were retired military/government who'd jumped to defense contracting. With a clearance and a little STEM knowledge, their salaries were easily 3X what they'd been making before retirement (I know this because I dealt with contracting at one point, and saw what their salaries plus overhead were costing us!) Most were in their 60's, some older. They seemed (based on how they talked) to be living quite large, yet here they were, in a dingy government office. Some seemed happy, but many were grumps.

I was one of the retired military, as were many of my friends, who made nice money in the contracting world. I was never anywhere remotely near the kinds of numbers you describe but I have friends who made it to those levels and higher. But my decent salary plus my pension put me at income levels I’d never expected.

My problem was that I really disliked the work and I broke the code that I might be doing it forever if I “lived (too) large” and began to depend on the big bucks to maintain a too high standard of living which needed those bucks. So, I kept living on something close to my military income, banked/invested the rest and once I’d accumulated the amount on which this thread is based i was outta there (before becoming either grumpy or 60.)

[ejman]

Quote:

Originally Posted by athena53 About 10 years ago someone posted on a personal finance board that if they had $1 million they'd be set for life. They could invest it at 8% and withdraw $80K/year forever. I pointed out to them that (a) an 8% rate of return, even if that were a realistic expectation, would have some volatility and require a very high % of equities and (b) $80,000 may sound good to them now but in 20 years it will buy a lot less, so you have to withdraw a smaller amount so that some can grow to allow for inflation in expenses. Not happy news to them, I'm sure.

I remember Peter Lynch of Magellan fund fame writing many years ago that a 7% withdrawal rate was perfectly reasonable.

[youbet]

Quote:

Originally Posted by ejman I remember Peter Lynch of Magellan fund fame writing many years ago that a 7% withdrawal rate was perfectly reasonable.

If you knew apriori that market returns going forward would be similar to what they have been this past decade, and you were my age, I do believe 7% would be just fine. But, but, but...........

[GravitySucks]

Quote:

Originally Posted by ejman I remember Peter Lynch of Magellan fund fame writing many years ago that a 7% withdrawal rate was perfectly reasonable.

That was common pre-Bengan/Trinity advice. I had an old timer FA type tell me I should be sure to be conservative since I was only 54 I should take only 6%

A Million may not be what it was but it's still freakin' sweet!

[aaronc879]

Quote:

Originally Posted by ejman I remember Peter Lynch of Magellan fund fame writing many years ago that a 7% withdrawal rate was perfectly reasonable.

If you are old enough for SS then that is probably true. If you retire then have a bear market right away then you could be in trouble. If you retired in 2010 you could have a 7% WR and still increase your net worth.

[F.I.R.E User]

We can live on $40k easily on the $1M today.

[cyber888]

When the 'Millionaire Next Door was Written" in 1996 - was he talking about $1 Million Dollars Overall Net Worth (including the House, less mortgage), or was he talking about $1 Million only in Investments and Liquid Assets ??

Because that translates today to around $1.7 Million. So, if being a Millionaire then in 1996 was Net Worth (include the house) - then if you have a $400,000 home with no debt or mortgage, your liquid investment would need to be around $1.3 Million.

[Koolau]

Quote:

Originally Posted by cyber888 When the 'Millionaire Next Door was Written" in 1996 - was he talking about $1 Million Dollars Overall Net Worth (including the House, less mortgage), or was he talking about $1 Million only in Investments and Liquid Assets ?? Because that translates today to around $1.7 Million. So, if being a Millionaire then in 1996 was Net Worth (include the house) - then if you have a $400,000 home with no debt or mortgage, your liquid investment would need to be around $1.3 Million.

I can't lay my hands on my (mainland) copy of the book right now. I was thinking NW included home equity. YMMV

[John Galt III]

I was about to post to say how salaries have inflated so much lately, but I checked first, and discovered that the median salary for a computer programmer in 2020 was only $85,000, with a max of $120,000. That makes me feel better. I was sure they were all making north of $105K per year these days. I maxed out at $80K per year as an experienced programmer in 2001. Not resenting the current crop of $85k per year programmers. That's lower than I thought it would be. Way to keep those wages down, megacorp, lol!