How to you determine if you are finacnially wealthy?

[Slade]

I have been speaking to a lot of people about the definition of rich/wealth, some people say it's when you don't have to look at the price of things when you buy them, or others say that they could stop what it is they are doing and be financially secure for the rest of their lives.

I think personally for me it is when I have at least 3 cycles of income making money for me, i.e; assets paying for themselves, then paying for other assets, which pay for themselves and then generate profit; whether that be business, property or shares.

This means that I have heavily positive geared assets that produce a profit with managed risks.

So, what does being wealthy mean to you?

[Mark]

When I stop asking myself if I can afford it.

I have a mate that never looks at the price tags and just buys everything with his Black Amex card, I don't class him as rich but he is certainly comfortable.

[The Y-man]

As stated in one seminar I went to:

To have enough assets generating enough income (after tax and adjusted for inflation) to do whatever I want, whenever I want, whereever I want, indefinitely into the future.

Cheers,

The Y-man

[J_D]

Well said Y-Man,

A mate of mine approx. 2 years ago found him in the position where he no longer was in a 'position of wealth'. His comment is as follows:

"I used to go out for dinner at night, and make sure I always had a minimum of $10k (cash) on me, so that if i wanted to have a big one, i could...."

"When ever I walked into a shop, if i wanted it, i bought it... the hardest thing i struggle with now is the fact that i have to look at a price tag, or even take note of the figure on the receipt"...

JD

[JamesGG]

Hiya,

I remember one of the first lessons that I learned about wealth was from Robert Kiyosaki (although I suspect that I am not alone on that front). My old man gave me RK's first book, 'If You Want To Be Rich And Happy, Don't Go To School', when I was about thirteen.

One of the concepts that I remember from it was something along the lines of measuring wealth in terms of time, not dollars.

In simple terms, for example; if you have $10,000 in the bank, earn passive income of $1,000 per week and require $2,000 per week to live your desired lifestyle, then you are wealthy to the tune of about twenty weeks. This is how long it would take for you to run out of money if you stopped working for it.

On the other hand, if you have say, $10,000 in the bank, earn passive income of $3,000 per week and require that same $2,000 to live your desired lifestyle... then we can see that your wealth is unlimited. Your passive income will continue to pay for your lifestyle for as long as you need it to.

Cheers

James.

[HMcIntyre]

My definition of financially wealthy is when my passive income is equal to my spending.

A CEO making 1 million dollars a year who gets fired has to make a drastic lifestyle change because he's on a salary.

If I'm making $1000 per week of passive income and spending $900, I consider myself financially wealthy.