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Recently we were visiting one of our sons and his family, include a 13- year old granddaughter.
Out of the blue she stated she didn’t like millionaires. I couldn’t let that go unexplored.
Why not, I asked. They think they are big deals and they show off. How do you know a person is a millionaire, I asked. Because they have lots of stuff, fancy cars, and live in big houses.
My son was afraid of where I was going with this and gave me a look.
Do you know any millionaires, I asked. No, was the reply. I decided to end it there. I was tempted to say yes you do, but I was afraid where that might lead.
Spotting a millionaire is not easy, they don’t wear badges or dress in the latest designer clothes. I was at dinner last night with friends. One guy was a electrician- or was. Now he is retired and owns 80 commercial and residential rental properties.
Given the definition of net worth, I suspect there are far more millionaires than many people assume. In fact, there are around 22 million millionaires in the United States. 79% of millionaires did not inherit their wealth.
When a house and retirement savings are included, a net worth of $1,000,000 is not unattainable. Of course the big unknown is debt when considering net worth.
Being a millionaire – or billionaire- does not mean you have a million in cash or a million to spend, but it may mean you have been around a while to get there. The median age of a millionaire household in the US is 62.
R:
That could have been a great teaching moment, however, since she was 13, I am reminded of the saying, “Those convinced against their will, are of the same opinion still.” It’s hard to convince a teenager of almost anything, unless you are a TikTok influencer or a peer.
While the “doubling of a penny a day” is a great example for young people, my favorite is a financial planning piece I first saw in the 1990s that I am sure most HD readers have seen.
It is the IRA Piece showing what happens when one sibling begins investing in an IRA at age 18 and stops at age 28, and the second sibling delays investing in an IRA until age 28, and invests until age 65. As you will recall, the first sibling, who only invested for 10 years, ends up with a greater retirement fund than sibling number two, who invested for 37 years. (I am pretty sure the annual amount back then was $2,000 annually, in the example.)
Either way, she is fortunate to have a loving and understanding grandfather.
Ouch, dare I say your grand daughter is being taught that in school? Where does a 13 year old come up with that statement, most likely she’s heard that somewhere else by someone she respects, maybe one of her teachers. Living paycheck to paycheck is not fun. I hope the youth of today will realize eventually how the real world works.
Perhaps. But keep in mind even millionaires can live paycheck to paycheck.
My financial guy saved me from panic more than a few times by keeping to the plan. My portfolio always came back and more in months or years, not decades.
It’s good feeling now knowing it’s virtually impossible to outlive our savings.
One good thing about our getting older is our spending has shrunk by about 2/3 over the past 22 years in retirement. Living in the same house for the past 45 years was key to our plan.
Moving to a CCRC next year with the plan to use our refundable entrance fee to pay our monthly fees should our investments vanish is the second key to feeling good about the next decade or two.