By my calculations, you have a joint net worth of €965k. So, I'm afraid you don't make it into the millionaire club just yet!
The millionaire next door drives a 4 year old car , lives a frugal lifestyle and doesn't take on consumer debt or show their wealth..
- Thread starter Laughahalla
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I read that as an observation rather than a researched back comment
I was suggesting that we shouldn't assume that because somebody has a flash watch and car that they have taken it in debt. Although with cars I can see Irelands obsession with the latest reg. Cars are ridiculously overpriced here. It would be an interesting study to see if car sales would be affected if the registration did not state the year it was bought.
I agree and in Dublin it makes sense to buy as rent is generally > mortgage. I have lived in other cities where it is the opposite by a long shot, so the point should be to do which one makes the most economical sense.
Daddy Ireland
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Sorry investment property misquote should read as 190k and not 150k.
Laughahalla
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According to the Oxford dictionary you are the Millionaire next door. Congratulations.
noun: millionaire; plural noun: millionaires
a person whose assets are worth one million pounds or dollars or more.
noun: millionaire; plural noun: millionaires
a person whose assets are worth one million pounds or dollars or more.
Brendan Burgess
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Well done!
You are now worth €1m and €5k
Welcome to the club.
Your membership card is in the post.
Brendan
Daddy Ireland
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I must get the book.
I personally don't consider my PPR which I'll never sell as part of a millionaire tot up figure. Many might but I personally don't. Fine perhaps if I was to sell it or consider selling it and in that case I would be downsizing anyway. So my PPR will go to my grave when my millionaire status might click in in my net worth that will be there for dependants. Thats the way I see it be it right or wrong thinking.
I think it's a little more complicated than the definition in the dictionary and open to all sorts of variables. Firstly the currency.
Including the full value of a pension pot - how much of that will be taxed?
Likewise with other assets, should capital gains tax be factored in?
If a couple jointly own assets worth just over a million are they both millionaires?
Probably plenty of other variables as well
Brendan Burgess
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Seems to matter a lot to women I have met over the years!!! And rejected by I should add.....Although that could be down to looks and personality but I think I could have overcome that with a millionaire tag!
Daddy Ireland
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Not bothered whether I'm in the club or not. Just asking the question if I am considered in the club and making the point that one's PPR as part of the figure could be questionable. Agree with IIgon's post too that there are many variables includung tax on pension pots.
In my previous life a millionaire client was assessed absent his or her principal private residence, they had to have access to cash or investments that would exceed €1 million if liquidated, or a bar as those that like to boast refer to it.
This makes some sense as you have to live somewhere, there are lots of millionaires in this country, many more than the average Joe thinks.
Since the crash there are many more aiming for financial independence with gusto and they will also be millionaires...in time with some focus of course.
This makes some sense as you have to live somewhere, there are lots of millionaires in this country, many more than the average Joe thinks.
Since the crash there are many more aiming for financial independence with gusto and they will also be millionaires...in time with some focus of course.
Steven Barrett
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fistophobia
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Having a "bar" or being a member of the "2 comma club ".... it is a big deal.
You need to set yourself targets, as a motivator. 1M may not be enough for some people on here.
Its not about keeping up with the Jones, or having the latest toys. I guarantee you, most of the new cars on the road are not bought with cash.
Whats important is, knowing when you have enough. If its 25X your annual expenses, or some other measure of income.
Notice, Im not saying 25X your income.
You need to set yourself targets, as a motivator. 1M may not be enough for some people on here.
Its not about keeping up with the Jones, or having the latest toys. I guarantee you, most of the new cars on the road are not bought with cash.
Whats important is, knowing when you have enough. If its 25X your annual expenses, or some other measure of income.
Notice, Im not saying 25X your income.
That's pretty much the definition of an "accredited investor" in the US (where you are considered to be wealthy/sophisticed enough to invest in private funds that have not been approved by the SEC).
Moving on from the (IMO silly) idea that your home is not an investment or somehow does not form part of your net worth, it is probably worth bearing in mind that a typical Garda will retire with State-guaranteed pension entitlement with an actuarial value well in excess of €1m.
It's not remotely uncommon for Irish people in their 60s to have a net worth of €1m+.
With 1m and 5k, including your PPR, and using pre-tax value of investments, you likely have some way to get to 'real' millionaire status
These are just different (underspecified) financial metrics, the ladder of Net worth ;-)
Net worth
Net worth (excluding PPR)
Net worth (excluding PPR) after all taxes paid
I think the main point is that they are some way to measure/track your own progress/wealth.
I think that something like 'usable after tax' Net worth/annual expenses is likely a reasonable measure of personal wealth, especially for non defined benefit pension folks.
2.3% of Dublin inhabitants are millionaires. Irish times "It means there are almost 32,000 millionaires knocking around the capital". That survey by WealthInsight defines "a millionaire as an individual with net assets of $1 million or more, excluding their primary residence."
This is from a comment thread on quora - about the distribution of net worth in USA - looks like 1 in 7 in USA can claim millionaire
Wiki also says "one would need to have almost thirty million dollars today to have the purchasing power of a US millionaire in 1900, or more than 100 million dollars to have the same impact on the US economy."
I did a quick google, and then quick scan of https://www.tasc.ie/assets/files/pdf/the_distribution_of_wealth_in_ireland_final.pdf
The Median net wealth of irish households is 102,600, mean is 218,700. (definition is all assets - all liabilities) i.e. 50% of households have assets - liabilities of > 102,600.
But the report has lots of interesting data in it
"the most common form of financial asset is a savings account (deposits or savings accounts as well as positive balance on current accounts), owned by 88.6% of households. 13.1% of households have shares and 7.5% hold bonds or mutual funds. The median value of savings accounts is €4,500 while it is €4,000 for shares. While only 10% of households have a voluntary pension, the median value for these is €44,700 per household1 . The median value of all financial assets is €6,300 per household" .
"Savings represent 54.9% of the total value of all financial assets with voluntary pensions next highest at 21.6%. Other financial assets such as shares and bonds and mutual funds were lower at 10.4% and 8.7% respectively of all financial assets." => We really don't invest as a nation!
"The greatest concentration of wealth in Ireland as per the HFCS data occurs in land ownership. Only 10% of households owned any land and thus the value of land assets is highly skewed. But rather than being spread across the wealth distribution, land is highly concentrated amongst the wealthiest households. The Top 20% owns more than 90% of all land (by value), while the Top 10% owns 82%. The role of farm land in this is a contributing factor."
"When looking at the distribution of wealth by income group, the top 20% of income earners have 39% of net wealth, while those in the bottom 20% have 11% share of net wealth."
"The average median value of financial assets for all households is €6,300. This means that half of all households have financial assets worth less than €6,300"
The Median net wealth of irish households is 102,600, mean is 218,700. (definition is all assets - all liabilities) i.e. 50% of households have assets - liabilities of > 102,600.
But the report has lots of interesting data in it
"the most common form of financial asset is a savings account (deposits or savings accounts as well as positive balance on current accounts), owned by 88.6% of households. 13.1% of households have shares and 7.5% hold bonds or mutual funds. The median value of savings accounts is €4,500 while it is €4,000 for shares. While only 10% of households have a voluntary pension, the median value for these is €44,700 per household1 . The median value of all financial assets is €6,300 per household" .
"Savings represent 54.9% of the total value of all financial assets with voluntary pensions next highest at 21.6%. Other financial assets such as shares and bonds and mutual funds were lower at 10.4% and 8.7% respectively of all financial assets." => We really don't invest as a nation!
"The greatest concentration of wealth in Ireland as per the HFCS data occurs in land ownership. Only 10% of households owned any land and thus the value of land assets is highly skewed. But rather than being spread across the wealth distribution, land is highly concentrated amongst the wealthiest households. The Top 20% owns more than 90% of all land (by value), while the Top 10% owns 82%. The role of farm land in this is a contributing factor."
"When looking at the distribution of wealth by income group, the top 20% of income earners have 39% of net wealth, while those in the bottom 20% have 11% share of net wealth."
"The average median value of financial assets for all households is €6,300. This means that half of all households have financial assets worth less than €6,300"
Define "wealth"? Define "financial asset"?
A 55 year-old Garda, with 30-year's service, will have accrued a State-guaranteed, inflation-proof, pension entitlement that would cost well in excess of €1m to buy in the open market. Is that a "financial asset"? Probably not. But it's certainly an incredibly valuable entitlement.
I don't mean to pick on the Gardai. Take pretty much any public servant and figure out how much it would cost to buy their accrued pension entitlement in the open market. Those entilements have a value that I would suggest is simply ignored in these "surveys".
A 55 year-old Garda, with 30-year's service, will have accrued a State-guaranteed, inflation-proof, pension entitlement that would cost well in excess of €1m to buy in the open market. Is that a "financial asset"? Probably not. But it's certainly an incredibly valuable entitlement.
I don't mean to pick on the Gardai. Take pretty much any public servant and figure out how much it would cost to buy their accrued pension entitlement in the open market. Those entilements have a value that I would suggest is simply ignored in these "surveys".