Meet the Boring Young Millionaires
|August 19, 2008||Posted by Roshawn Watson under Uncategorized|
Recently, Kiplinger Personal Finance Magazine profiled Rik Wehbring, a 37-year old millionaire living on $50,000 a year in San Francisco.
He simply states that “I do not need material possessions.” He made his money during the dot-com boom but unlike many of his peers (both younger and older), he decided to forgo materialism and irresponsible money habits.
He is part of a newly-named group: YAWN (Young And Wealthy but Normal).
Considering that most people become millionaires between 50 and 60, he is about 2 decades ahead of his time (at least from a net worth standpoint). Although the article failed to disclose exactly how much he is worth, it is most likely that he is part of a growing number of middle-class millionaires with a net worth approximately between 1 and 20 million.
Living Beneath Your Means
One of the most common characteristics of the wealthy is that they live far beneath their means. Okay, that may sound trite and obvious, but the reason it is so important is because other pundits claim that you merely need to increase your means. Most people focus on income so they can continue their conspicuous consumption-oriented lifestyle whereas most millionaires focus on net worth. The following statement accentuates this point. Did you know that…
On average, millionaires annual realized income is less than 7 percent of their wealth. Moreover, the average millionaire saves at least 20% of their earned income.
Out of The Spotlight
Do not allow financial headlines to be your sole sources of financial information. Looking at any financial news website and newspaper, you will see how bad the home prices are, how the economy is in a funk, and how job losses are abundant, etc.
Although all of these things are true, what often gets overlooked is that millionaires are increasing both in number and in wealth. The same financial principles that worked a decade ago are still working today. Although it is also true that perhaps using your primary residence for short-term wealth building may not be a good plan, over the long-term home-ownership makes sense. Over 97% of millionaires are home owners.
Moreover real estate investors are scooping up good deals all of the time because of overstretched mortgage holders. The media gravitates towards the extremes. For example, check out the following clip…
He is not the prototypical millionaire, and most millionaires cannot afford to spend like he does. At the end of the day, decide what’s most important to you: displaying a particular social status or realizing enormous wealth. Your decision with determine your financial legacy, so choose wisely.
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Copyright 2008, Roshawn Watson, Pharm.D. All Rights Reserved.
Copyright 2012, Roshawn Watson, Pharm.D., Ph.D. All Rights Reserved.