Lessons from very rich people

[Shwa Girl]

I don't see the point in being a complete tightwad if you have millions of dollars, but that may be just because he grew up/came of age during the recession, I'm told a lot of people from that generation, regardless of how times have changed, were more reluctant to part with money or 'things'.

I guess the point of being a tightwad is that a sacrifice in some areas leads to winning in other areas. I don't think the millionaires are tightwads for life.
1. OP said that some bought their vacation homes -- win.
2. They can buy what luxury that they want, whenever they want, and not affect their millions - win
3. They can provide the best education for their children, ensuring the next generation has more opportunities - win.

[Gsxrboy]

The three examples that I have mentioned all have invited on their family trips, however, not one of them offered to pay for me! They knew what I was earning and that I had to take the bus, but not once did they ever offered to pay my way. Its funny how they view money and they way they spend it.

[JennyFromTheRock]

I suppose to some people my family falls into the "rich" category. My husband has gone from Making $75,000 a year ( when we met ) to $100,00, to $140,000 last year, to this year where is will make over $200,000 ( already at $80,000 for just Jan, Feb, March and April - which includes a month that he took off )

I would consider us to be frugal to a point. We enjoy nice things, I love Jewelry, as does he. I drive a Jeep Grand Cheroke ( bought new 2 years ago ) he drives a 2012 GMC Sierra ( bought last month ) and we have another Truck he uses for work as well. My husband has a thing for electronics, so when a new TV hits the market, he "needs" it ( we have a 70 inch flat screen in the Living room, 55 inch flat screen in the kids play room, 47 inch flat screens in all 4 bedrooms and another in the family room ) Our children always have everything they desire.... as long as they earn it by doing their chores, behaving and doing well in school.

At the same time as those splurges.... I coupon, and have since back when I was single and struggling. My husband uses coupons as well, plus we donate frequently to our food bank and shelters. We invest in both stocks and mutual funds, as well as our childrens RESP's. We take trips when ever my husband has time, and if we see a homeless person who we feel really IS looking for money for his next meal, we have no problem giving them $20.

So I guess my point is that Rich people are the same as any one else, not all are cheap, not all are frugal. Some fit right in the middle. Just like people of any class. It takes all kind of people to make the world go round.

I should also add..... my husband gets a T-4 lol

[NuCoupon]

I know two different people who are also very wealthy (10+ million). Due to the nature our relationship, I know about their finances pretty well and their spending habits are completely opposite of one another. I think everyone is different

[NuCoupon]

The three examples that I have mentioned all have invited on their family trips, however, not one of them offered to pay for me! They knew what I was earning and that I had to take the bus, but not once did they ever offered to pay my way. Its funny how they view money and they way they spend it.

Just curious, when you invite someone to your home or to a restaurant, do you pay their way? I don't. The only thing I provide is food and drinks at my home. I never pay bus fare, parking, gas money or their half of the restaurant bill

[JennyFromTheRock]

Just curious, when you invite someone to your home or to a restaurant, do you pay their way? I don't. The only thing I provide is food and drinks at my home. I never pay bus fare, parking, gas money or their half of the restaurant bill

If I invite someone to a restaurant for a one on one dinner, I pay for their meal and drinks. If a group is going and I invite a friend as in "you should come along" I don't. If a friend and I agree mutually to have lunch or dinner at a restaurant ( ie. We should have lunch on Saturday ) we each pay our own ( or the occasional "oh I got this one" from either of us ) I never under either of the circumstances pay their transportation or parking.

[matrix82]

I have given a friend bus fare a few times when he's come to visit me. You'd have to know my friend to understand why. Great guy, great friend, horrible with money and kind of forgetful. I'd rather give him the $2 bus ticket then see him walk home through a rough part of town.

I just wish for the day when I can get my student loans paid off. Given my career choice I will never be rich. I live frugally out of necessity. I'd love to have enough money to not worry about the $15 I spent when I drive the hour into town to get groceries. C'est la vie. We are doing well for us and living the best we can.

My only regret is that we can't afford children. That is tough, and that really makes me sad. People who have kids say "oh there is no perfect time to have kids, so just have them". They also don't have a six figure amount of student loan debt with a part-time employed spouse. Living within our means that means no children and it's heartbreaking.

[Shwa Girl]

Just curious, when you invite someone to your home or to a restaurant, do you pay their way? I don't. The only thing I provide is food and drinks at my home. I never pay bus fare, parking, gas money or their half of the restaurant bill

Yes. Here's how Miss Manners answered the same question about dinner in a restaurant:
http://articles.courant.com/1996-07-...-get-well-card

[lekate]

I guess the point of being a tightwad is that a sacrifice in some areas leads to winning in other areas. I don't think the millionaires are tightwads for life.
1. OP said that some bought their vacation homes -- win.
2. They can buy what luxury that they want, whenever they want, and not affect their millions - win
3. They can provide the best education for their children, ensuring the next generation has more opportunities - win.

I didn't mean millionaires or people with money should go and blow it on every nice new toy, but having nice things shouldn't be shunned. You can have your vacation home and a mid-range less than a 1000$ suit. Or a new car, or new to you but not a beater.

[Shwa Girl]

I didn't mean millionaires or people with money should go and blow it on every nice new toy, but having nice things shouldn't be shunned. You can have your vacation home and a mid-range less than a 1000$ suit. Or a new car, or new to you but not a beater.

Got it. Thanks for clarifying.

The studies show that millionaires next door would probably not buy a $1000 suit. The ones in the states usually spend $250 for a suit -- max. They may spend $250 for their son or daughter who has just graduated from university, hoping that the suit will be used for interviews at great companies.

About the cars, yes, some don't buy beaters. Those millionaires next door that buy luxury cars tend to buy them used and negotiate on the price. They spend a lot of time researching the luxury cars for sale, they may bring cash, and even then try to offer a slightly lower amount when completing the sale.

[LifeisBeautiful]

There are three families that are millionaires that are close to my husband's family. They have all bought luxury cars brand new, but as many have mentioned they love shopping at flea markets, and finding the best deal. None of them were born into money, all self-made. All of them made it from business and real estate, none from a t4. Many advantages to making money as a business, not as an employee. You pay tax after paying your expenses.
My husband and I are asset rich, but cash poor lol. We have almost 3 million in assets, but we put it all back into paying down the properties, improving them or buying more. We do own our own vacation property in Fort Lauderdale, but with three toddlers where are you travelling to? It was smart because it was a great financial investment at the time, and it made us able to still travel.
So, how do you define rich? Your net worth or cash flow?

[LifeisBeautiful]

actually, a lot of business people i know lease cars? We have been thinking about it. Any ideas?

[Gsxrboy]

Thank you for posting everyone your thoughts and experiences! The more we post, the more everyone hear can learn about money and hopefully succeed in the things we wish to achieve.

[JennyFromTheRock]

There are three families that are millionaires that are close to my husband's family. They have all bought luxury cars brand new, but as many have mentioned they love shopping at flea markets, and finding the best deal. None of them were born into money, all self-made. All of them made it from business and real estate, none from a t4. Many advantages to making money as a business, not as an employee. You pay tax after paying your expenses.
My husband and I are asset rich, but cash poor lol. We have almost 3 million in assets, but we put it all back into paying down the properties, improving them or buying more. We do own our own vacation property in Fort Lauderdale, but with three toddlers where are you travelling to? It was smart because it was a great financial investment at the time, and it made us able to still travel.
So, how do you define rich? Your net worth or cash flow?

I would say in my opinion it would be a mix of both. In my opinion there is no use to have millions in assets if you cannot use it, on the other hand, there is no point having millions in cash and not spend it on assets. So having an assets as well as access to cash would be my definition

[matrix82]

I think rich has a different definition for anyone. I think if you have no debt, that is doing well. Rich would be having no debt, having more than enough to live on, being able to splurge once in awhile, and money put into savings each month. That could happen at any income level, if you want a level.

No debt, making $40,000 + a year seems rich for me, in my situation right now, as that is double what I make in a year. I don't know if it's possible to really define at what salary makes one rich.