This is how I define "rich"

I have held this personal definition for a long time and I wonder if anybody agrees.

If one can live with the basic necessities of life (food, clothing, shelter, sanitation) completely financed by investment income, one is rich.

I include any and all income. Stock dividends, bond interest, or capital gains. If you have enough money in the bank so that you can live without working, without starving, and without freezing in the cold, for the rest of your life, you are rich. Period.

and are well disciplined. That would include most retired people btw..

When you can live a life where you are not a slave working on someone else's orders or in order to put money in THEIR pocket.

When you can spend as much time with your loved one's as possible and make those around you happy, not with possessions but with the contendeness of being together.

When you can have a "practice" in your life that you continually work at and grow at.

Lots of people are still getting pensions in the form of annuities from companies or government entities they worked for. Most would not consider that to be rich. But it's about the same as having a lump sum equivalent and living off the earnings.

So I don't think I can salute your definition. But to be fair I don't have a better alternative to offer. Lots of people seem to look at this in different ways.

... and I think you already said it, but this does not also require a Mercedes or a McMansion... just the damn FREEDOM... yeah, hope I can get there before I'm too old... I value the freedom more than the crap (stuff). Just saw a headline on Yahoo yesterday saying 'study reveals career changes value passion more than pay'. Well DUH, of course! That's WHY they're changing careers! :^)

:)

I have never been able to afford a manicure, a pedicure or a massage. To my wallet, those are luxuries.
I had to give away my dog as I could not afford the pet food and vet care she needed.
Vacation? Don't make me laugh.

Am I rich or do I know how to exploit the weakness of capitalism?

People still refuse to acknowledge how well off the top five percent in this country really are, whether they work at a $150,000 a year job or not.

Days like this I cannot believe I'm on a Democratic board.

Are CEOs who make multiple millions a year not rich because they "work" for it?

They're still rich because they don't have to work. They can live a comfortable life off their riches without the need to work.

Other people do the work and they take home a fat pay check and the ones who made him rich earn minimum wage.

But I think a person needs a little bit more than the necessities and free time to be rich. I think having enough money for the little pleasures in life (travel, good food, Netflix, or whatever one's personal little nonextravagant indulgences might be) is needed to be "rich," at least as I would define it. An excess of those things, no. But the ability to enjoy them without wondering when the next opportunity to enjoy them will be, yes.

Not to minimize the extreme wonderfulness of "rich" as you define it. Anybody in that situation is fortunate indeed.

On edit: I just had to laugh when I saw what my reply looked like as posted: a little paen to the value of earthly pleasures over a jpeg of a Buddhist prayer wheel. Oh well. It's good to have spiritual goals even if I'm not nearly there yet.

..but I doubt they would call themselves rich.

You might add the caveat that to be part of this super-affluent group you need to be able to live off your investments without spending your capital (most retiree's use a draw down of their original funds along with investment returns) and/or have your assets still growing. To be in this position is to be part of the modern global aristocracy those who get richer daily without doing anything resembling work.

/thumbnail

(I wish I new how to post a better/larger picture to view, or that you didn't have to 'click' at all ~ sincere apologies for my technological failure).

You really have to look at the details of this painting....the coin in the main subject's left hand, the statue in the background, the expression on the main subject's face. Then there's the almost naked man in the background.....

and do you know the name of the piece?

I know this as "Portrait of a Young Man", but my online searching has shown (to me) that there may be more than one version of Allori's "Portrait of a Young Man". A 'quick' online search of Allori's works elicits a different painting for this name - although I notice a similarity to the one I mention.....a coin in hand, the facial expression, pointing to ??? something.....

(I was hoping you asked the question about author/name of piece b/c you were going to link/display a better picture for other DU'ers to see. Now, I'm not sure why you asked about the artist/name of piece, but I digress....)

Do you have any thoughts, after viewing this painting, as to 'which man is rich'?

Peace,
M_Y_H

If you're not being shot at in a war zone, if you can easily obtain drinking water and it is not polluted with feces or other seriously unhealthy pollutants, if you can obtain edible food and do not experience hunger on a regular basis, if you have a working sewage system, if you have reasonably constant electricity, and if you can afford a cheap bicycle...yes, you're rich. We are spoiled and need to get used to the new standard of what it is to be rich.

Plus, if you feel the freedom to express yourself in public...

Hell Yes, you're rich!

the numbers may be different now, as this was made in 1990, but the message is still there-
http://www.youtube.com/watch?v=4C-u6kdHuXE

college educations for my two daughters.

I don't want them saddled with crushing debt.

This keeps me up late at night.

I am NOT rich.

In my unpopular opinion, people who live on investment income leach off the hard work of others. Therefore, I just see those you defined as leaches.

I have a lesser definition of being rich. Those are, people who simply own their own homes -- something that unfortunately is a afforded to the few. This society is organized enough to provide food to its people so I don't think that is a factor, and paying utilities or moving to a habitable climate as not to freeze is a relatively simple endeavor. Most people are enslaved by either rent or 30-40+ years mortgages, so anyone free of that IMHO is rich.

My small pension and our S/S income pay about 80% of our ordinary monthly living expenses. That doesn't include the annual 'big hits' for homeowners' and auto insurance. Or real estate taxes.

Now I'm on Medicare. It's interesting that the cost of the plan is more than I was paying for my so-called (promised) "free" retirement health insurance. It quit being free about a year after I retired.

Except my 'pension' is now paid by the Pension Benefit Guarantee Corporation since my former company declared its final bankruptcy and dissolved in 2000. And the PBGC is billions of dollars in the red. So at least as long as Bush is in office I won't be surprised to get a letter explaining why and by how much my pension is being cut. Or just discontinued completely.
So I'm only 'rich' for the time being.

I pay the rest of our expenses with periodic withdrawals from my IRA. I try to keep it invested in safe, conservative (you should pardon the expression) interest paying debt instruments. So far, I'm holding my own. Pretty much leaving capital at a constant level and living off the proceeds.

But I can tell you, I sure don't feel rich.

I manage the family fortune.

they are on a strict budget? Some people have all they own in the world in their house. Then they retire, sell the house and invest their savings in a number of things..and live off of that.

??

My understanding is that unemployment benefit in the US is such that anyone can afford to live and eat on it, if you're willing to live in a trailer park or similar and refrain from such luxuries as trying to raise a family or get through university, without "investment income" entering into it.

Not worrying about the basics is necessary for me to call someone rich.

This is not meant for those on pensions and other fixed incomes. This is intended for those with massive investment portfolios who live off the interest/dividends. Not those who squeek by but those who live well.

These are the people who do not contribute to society. They live well off the results of investments earned by those that came before them with the very occassional individual who got there themselves.

The top 1% have little concern or mercy for those in the other 99%. That is the way it is, people either accept this or they don't.

Julie

view of investing?

What do you think money is being invested in? It's not just sitting there in a lump.

A man who worked as a tool and die maker for 52 years plus (still working 32 hours/week at 71). A man who voted Democratic every election since '58. A man who bought a an AMC Gremlin when his neighbors bought big Buicks and Caddies. A man who refused to go into debt for his car, while the Jones' went into debt to buy boats, snowmobiles, campers, and other toys. A man who sent both his kids though school without debt - we went to state schools and lived at home. A man who has lived in the same modest home since 1964. While doing all this, he managed to save his own money, and grew a small (less than 20k) inheritance from his dad.

His portfolio is not massive, but he certainly would not have to work if he did not want to. I won't call him a leech to his face, he's still fit (runs 3 times a week) and has a short temper.

We should be careful applying labels, IMHO.

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I have a family friend who is the heir of a smallish trust fund. He doesn't work, and he lives off his trust fund. That said, his annual spending meager - he's one of the cheapest people I've ever known. He pretty much has to be if he's to live off his trust fund alone, because if he digs in more there wouldn't be enough interest to support even his modest lifestyle.

So he does have the basics completely financed by investment income - but it's a very small amount, and no one would call his lifestyle rich.

I think you're onto something, but I don't think you can really get at what is "rich" absent some measure of financial value.

I think I should have put a greater emphasis on the fact that my definition requires one to not work. Yes, that does include retirees, even though they worked all their lives in order to become "rich".

If your friend's trust fund has enough capital in it for him to live without working for the rest of his life, then he is rich. I purposefully disregard any lifestyle or luxury qualifications for the very reason that they are so numerous and impossible to reconcile in any quantifiable way.

The point of my definition is that the investment income comes from invested capital. It is this large sum of capital that makes someone rich, not the income with which they use to live.