The Rich

[camski]

I was reading one of the threads here and the term "The Rich" was getting thrown around quite a bit. I thought it might be good to start a thread around this term. My feeling is that there "The Rich" are actually made up of a number of subgroups, so you cannot really just lump them all together when discussing "The Rich". For example the ones that come to mind to me are the Hollywood rich, Prosports rich, wall street rich, entrepreneurial rich (or business rich) and lottery rich. There are probably others that I am neglecting here but what are your thoughts?

 

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[randallg99]

I was reading one of the threads here and the term "The Rich" was getting thrown around quite a bit. I thought it might be good to start a thread around this term. My feeling is that there "The Rich" are actually made up of a number of subgroups, so you cannot really just lump them all together when discussing "The Rich". For example the ones that come to mind to me are the Hollywood rich, Prosports rich, wall street rich, entrepreneurial rich (or business rich) and lottery rich. There are probably others that I am neglecting here but what are your thoughts?

is there a good reason how this knowledge can help you achieve your goals?

 

[Russ H]

I think it's a good question, in part b/c some of the posters here have *very* different ideas of what "rich" or "rich people" are. Or for that matter, what constitutes "wealth".

For instance:

Someone who lives in a big house, has lots of bling, and drives an expensive car may not, in my eyes, be wealthy.

They may just be living beyond their means, and going deeply in debt to finance their "lifestyle".

On the other hand, someone who lives simply, in a more modest house, drives an older, but well kept car, and doesn't seem to be into the latest trends or designer duds may not appear to be "rich". They may give to charities, or have other places where their money goes (travel, for instance).

I think we may want to distinguish here between "wealthy" people, and "rich" people.

Perhaps what I described above is the difference:

A "rich" person has outward symbols of money. They may, or may NOT, actually have lots of money. But they have expensive "things"

A "wealthy" person has money. They may, or may NOT, actually have outward symbols of this. But they have high net worth.

These definitions allow for a lot of overlap:

"Rich" people who actually do have money, and
"Wealthy" persons who have expensive things.

But here's a harder question:

Which is fastlane?

-Russ H.

 

[MJ DeMarco]

I have a half-completed post/chapter in my book about this very thing entitled the "Ubiquitous Millionaire" and actually defines what is financial rich.

The term "millionaire" is loosely tossed around as a ubiquitous word that seems all-encompassing to determine someone rich. Such is far from the truth. A "millionaire" is simply someone in the upper middle class, and by all means, lives and appears like any other middle-class household.

When I finish the writing, Ill post it.

 

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[Z5 FILMS]

A "rich" person has outward symbols of money. They may, or may NOT, actually have lots of money. But they have expensive "things"

A "wealthy" person has money. They may, or may NOT, actually have outward symbols of this. But they have high net worth.


-Russ H.

In my opinion "rich" and "wealthy" are the same thing. Kinda like "cat" and "feline".

You can have all the expensive toys in the world. If you don't have lots of cash or assets, you're not rich or wealthy.

I know my share of people who drive expensive cars and brag about all their expensive toys, yet when it comes time to pay the little $30 bar tab, they vanish. Cause in reality, they are broke as a joke.

 

[Adam]

In a short description, I've always considered rich people to be people like athletes, actors, etc. Wealthy people are the ones that cut rich people their paychecks.

Rich people can be created in a very short time frame, with the signing of a Hollywood or sports contract, the closing of a real estate deal or the invention of a widget. True wealth typically takes much longer to grow (typically a generation or more), BUT wealth will never be jeopardized when the sports contract gets cancelled or the real estate deal doesn't close. I've seen rich people come and go in a 12 months timeframe, wealth, however, is much stronger.

Now on the topic of "millionaire"; I've always struggled with this. I am one? Well, technically; but I don't see it that way. My companies have real estate assets well into the millions, but much of that is equity in commercial RE. The large amounts of equity allows us to leverage for future projects and translates into monthly cashflow, but none of it is easily accessible (or liquid). It's all just numbers on a balance sheet. So, there is a piece of paper at my accountants office that states that I am a millionaire, but that's about it. Not a glamourous as I would like it to be!!