Comments on: Are You Wealthy? Here’s a Test http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/ Personal Finance. Investing. Wealth Building. Sat, 20 Mar 2010 18:13:48 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: The Truth of Credit » Blog Archive » How Do You Identify Wealth? http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-20639 The Truth of Credit » Blog Archive » How Do You Identify Wealth? Mon, 06 Apr 2009 03:06:38 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-20639 [...] Are you living “high” or are you wealthy? - There are many people that make a lot of money. They also spend a lot money. In the end, they are not wealthy. However, there is another group that makes good money but also creates wealth. More on this statement here. [...] [...] Are you living “high” or are you wealthy? – There are many people that make a lot of money. They also spend a lot money. In the end, they are not wealthy. However, there is another group that makes good money but also creates wealth. More on this statement here. [...]

]]> By: Are you Rich, yet? « How to Make 7 Million in 7 Yearsâ„¢ http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-5790 Are you Rich, yet? « How to Make 7 Million in 7 Yearsâ„¢ Fri, 15 Feb 2008 13:37:01 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-5790 [...] that I read is Pinyo’s very open blog; in one post he [...] [...] that I read is Pinyo’s very open blog; in one post he [...]

]]> By: 7million7years http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-5655 7million7years Fri, 08 Feb 2008 18:55:52 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-5655 Thanks for this post! The problem with all these external measures is just that ... they are external. If that's what you want, Networth IQ has a free tool that helps you measure your own Net Worth [ here's my GENUINE entry on their site: http://www.networthiq.com/people/7million7years ] and then compare it to others. But, the real definition of wealth is how much YOU need to live off (indexed with inflation) for the 'life of your dreams' ... your real dreams (for most people that doesn't require a Ferrari and a Lear Jet). Multiply that by 40 (to be 99% sure your money will last as long as you do) ... if you have that, congratulations, you are RICH. Simple and accurate ... for you. AJC Thanks for this post! The problem with all these external measures is just that … they are external. If that’s what you want, Networth IQ has a free tool that helps you measure your own Net Worth [ here's my GENUINE entry on their site: http://www.networthiq.com/people/7million7years ] and then compare it to others.

But, the real definition of wealth is how much YOU need to live off (indexed with inflation) for the ‘life of your dreams’ … your real dreams (for most people that doesn’t require a Ferrari and a Lear Jet).

Multiply that by 40 (to be 99% sure your money will last as long as you do) … if you have that, congratulations, you are RICH. Simple and accurate … for you.

AJC

]]> By: Pinyo http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-131 Pinyo Thu, 09 Aug 2007 23:14:52 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-131 Minimum - I think the question you should ask yourself (despite what other people have to say) is do I have enough money to retire or do I have to work the rest of my life? Another rule of thumb, if 5% of your current net worth can cover 1 year expense. You should have enough to retire assuming you will be able to invest the remainder of money and continue to grow it. Minimum – I think the question you should ask yourself (despite what other people have to say) is do I have enough money to retire or do I have to work the rest of my life?

Another rule of thumb, if 5% of your current net worth can cover 1 year expense. You should have enough to retire assuming you will be able to invest the remainder of money and continue to grow it.

]]> By: Minimum Wage http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-130 Minimum Wage Thu, 09 Aug 2007 23:07:52 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-130 glblguy - actually, there's a popular site i've seen linked to several pf blogs, where you can look up the median net worth for people of (a) your age or (b) your income. That also can give perverse results. Based on my income, my net worth (the median) "should" be $1,100. For my age, my net worth should be some really huge number. Which number should I believe? glblguy – actually, there’s a popular site i’ve seen linked to several pf blogs, where you can look up the median net worth for people of (a) your age or (b) your income.

That also can give perverse results. Based on my income, my net worth (the median) “should” be $1,100. For my age, my net worth should be some really huge number. Which number should I believe?

]]> By: Pinyo http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-123 Pinyo Wed, 08 Aug 2007 22:45:43 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-123 glblguy - thanks for nice link. It's a good counterpoint. I love good counterpoints. glblguy – thanks for nice link. It’s a good counterpoint. I love good counterpoints.

]]> By: glblguy http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-122 glblguy Wed, 08 Aug 2007 22:12:31 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-122 @Minimum Wage - You win the prize...I'll let Pinyo pay you ;-). You actually stumbled on one of two flaws with the formula. If you look in detail at the surveys done in the book, they are mostly middle-aged people. The formula really breaks down with younger people coming out of college (High Salary, no savings, home, student loans, etc) and with older/retired people with low net incomes (the problem you found). It's really more of a rule of thumb. A more accurate way to really gauge your net worth is to look at median and average net worths of people in your age bracket. <a href="http://moneycentral.msn.com/content/SavingandDebt/P61280.asp">Liz Pulliam Weston has a good article on this</a> Of course the problem with comparing to your peers is that in general, most people's net worth is not where it should be, so the median numbers are really lower than I feel they should be, while the PAW formulas are probably higher than is truly realistic for most people. Good catch :-) @Minimum Wage – You win the prize…I’ll let Pinyo pay you ;-) .

You actually stumbled on one of two flaws with the formula. If you look in detail at the surveys done in the book, they are mostly middle-aged people. The formula really breaks down with younger people coming out of college (High Salary, no savings, home, student loans, etc) and with older/retired people with low net incomes (the problem you found).

It’s really more of a rule of thumb. A more accurate way to really gauge your net worth is to look at median and average net worths of people in your age bracket. Liz Pulliam Weston has a good article on this

Of course the problem with comparing to your peers is that in general, most people’s net worth is not where it should be, so the median numbers are really lower than I feel they should be, while the PAW formulas are probably higher than is truly realistic for most people.

Good catch :-)

]]> By: Minimum Wage http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-121 Minimum Wage Wed, 08 Aug 2007 20:37:34 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-121 The formula breaks down badly at low incomes. It says a 50 year old earning $10,000 per year should be worth $50,000. Ya really think so? The formula breaks down badly at low incomes. It says a 50 year old earning $10,000 per year should be worth $50,000.

Ya really think so?

]]> By: Pinyo http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-47 Pinyo Tue, 31 Jul 2007 22:15:26 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-47 Yes, the book is good and I highly recommend it. It definitely provides you with a different perspective. Nice post on your site :-) Yes, the book is good and I highly recommend it. It definitely provides you with a different perspective. Nice post on your site :-)

]]> By: glblguy http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/comment-page-1/#comment-42 glblguy Tue, 31 Jul 2007 16:02:23 +0000 http://www.moolanomy.com/38/are-you-wealthy-heres-a-test/#comment-42 Thanks for the link! Wish I was PAW...someday ;-) Can't say enough about the book though, gives you a complete different perspective on being wealthy. Thanks for the link! Wish I was PAW…someday ;-) Can’t say enough about the book though, gives you a complete different perspective on being wealthy.

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