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  #21 (permalink)  
Old 01-09-2010, 11:15 AM
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Originally Posted by Unregistered View Post
hi, just curious what is the general consensus of definition of "rich"? how much $ a month, then will u be considered rich? (monetary sense im not talking about work-life balance etc here)

it seems to me that most of you do not consider lawyers and doctors to be rich. only comfortable. but the average lawyer/ doctor would rake in $10-$15k per month after 6 or 7 years of work. Plus their spouse who may/ may not be in the same profession, it adds up to quite a bit.

Is that not rich enough?
Say you earn $15K/pm, thats $225K per year and you are thrifty and save 40% of your income = $90K/year, which you put in the bank. After 10 years, you have $1m saved. That's only enough for a 2-bedroom apartment in the suburbs.

A rich guy should have at least a fairly new sports car, another luxury family mover and a bungalow in Sentosa. Let's see how much to need to earn to afford that the basics for the rich? Since you are rich, you buy cars with cash, but we can look at the depreciation. A new mid-range sports car like a Porsche 911 C4S would halve in value in the first 3 years or a depreciation of around $80K/yr. Get a slightly cheaper BMW X5 for the tai tai wife, which would depreciate at around $60K/yr for the first 3 years so total $140k/yr depreciation. That is around $12K/mo just for the cars. Bungalows in Sentosa start at $15m, so say you put down $5m (new govt rules) and take a $10m loan. Even with todays low interest rates, we're talking a mortgage payment of $70K/mo. So far, we have $82K per month for the basics. Say miscellaneous expenses are $30K a month (2 maids, 1 gardener, 1 driver etc etc), we are up to $112K/month so you would need to earn maybe $1.2-1.5m per year to live the rich life without any savings. However, most rich people save around 80% of their earnings, so for the typical guy with supercars and a sentosa bungalow, the $112K expenditure per month is just 20% of his earnings so he would be earning around $500K per month.

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