Different types of wealth

[Nicholasp27]

it may be his full-time job, but at any point he could take those assets and put it into an income-generating vehicle

that is unlike working your way up companies to make 120k/year salary, which u can't convert into an income-generating vehicle

[TheWorstPlayer]

balance #1 and #2 with as much #3 and you want (can afford - in every sense of 'afford') thrown in. LDO. All types are good, just balance them.

[Arnfinn Madsen]

3 early in life is the only probable route to achieve 1, 2 or 3. When did you last meet that guy that prioritized to get good grades in school instead of travelling half a year and then became wealthy? (except maybe in finance) You aren't born with a deep understanding of human interaction and I don't think there is any other way than 3 to achieve it. And I don't think it is possible to get wealthy without a deep understanding of human interaction and thus to achieve 1 and 2. So, early in life the choice is logical.

[Kneel B4 Zod]

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If you arent rich by teh time you are 50, imo, it was a waste to save all that money. I also think people are over estimating how hard it is to turn a 90k to 150k/ yr job with a wife and kids into enough money that you have enough disposable income and extra leisure time to do what you want by age 55.

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my landlord is maybe 45, not sure. he just sold my building (6 apts) and 2 others, each of them for about 1.5m. if he wanted he could easily have $300k in annual income from this cash...this fits right into Type 1.

(he's actually reinvesting into 1 large building instead, which will also generate income)

but anyways, his story isn't that unique, and he's not that old.

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a little different situation than what type 1 wealth is though. Im assuming he is a full time real estate/landlord etc? Im not saying that you cant become very rich in real estate, but thats your full time job, its much different than working as an accountant, and putting X amount of dollars away so that sometime you can buy some property.

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yes, he's a full time landlord. all or most of his money has gone into his business (his properties), which 15-20 years later is paying dividends. in the big picture, this isnt much different than using your savings to start a business, or buy a bar, etc.

I think you're confusing "how people spend their money" (ie is it on investments (type 1) or is it on Ferraris (type 2) or is it on whatever else they feel like (type 3 mb) with how to get that wealth in the first place.

[guids]

I guess, types 2 and 3 are the same difference imo, but like TWP said, its a tradeoff, I would never live like a pauper at the age of 25 so I can become a millionaire at the age of 50.

[Nicholasp27]

#1 doesn't say u have to put x% away in savings from your paycheck in order to achieve it; u can get it in a few months from a startup company or u can buy real estate, etc

#2 is not wealth; it is spending your paycheck to live well; if ur paycheck is high, then u can be RICH, but it's not wealth

#3 is not wealth either; it's living how u want to live


only #1 is wealth and u are saying it's a bad goal...why is it a bad goal to have ultimate freedom and not have to worry about your next paycheck? #2 has to worry about the next paycheck, as if it doesn't come, wave porsche...


u are saying a subset of 1, which is to save every penny so u have money when u retire at 65, is bad...fine...but there are plenty of subsets of 1 that u or i could achieve within a month from now if we did the right things


my goal is #1, as it's the only one of the 3 that is wealth...but my goal is to get there by 35, not by 65

[Nicholasp27]

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I guess, types 2 and 3 are the same difference imo, but like TWP said, its a tradeoff, I would never live like a pauper at the age of 25 so I can become a millionaire at the age of 50.

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i think this is the heart of the disagreement; #1 doesn't say u have to live like a pauper at 25

[guids]

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I guess, types 2 and 3 are the same difference imo, but like TWP said, its a tradeoff, I would never live like a pauper at the age of 25 so I can become a millionaire at the age of 50.

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i think this is the heart of the disagreement; #1 doesn't say u have to live like a pauper at 25

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maybe it was because of what the OP implied in his OP (the investment books), but I got the impression that he was talking about living like a pauper @ 25, so he'd be rich later. I may be wrong. Otherwise, ya, I agree with you. Personally, I probably spend a little more on toys than I should, but Id rather enjoy myself.

[HDPM]

I think you blend them, and most people do to one extent or another. For me the interesting thing was to notice what happened when we did better in type 1. We aren't there yet, but have improved in that area in the last few years. I increasingly find it harder to spend on type 2 stuff. I have spent my share of money on stupid stuff but am finding it harder to do. I will never be a total tightwad, but some spending is making less and less sense to me.

Type 3 wealth makes more sense as a tradeoff IMO. Trading money for time and interesting experiences is to me more valuable than failing to save/invest to have nicer suits or collectible wine or something. And of course, going into debt for type 2 stuff is a real problem for people.

[SomethingClever]

I posted my story in the financial success thread so I won't repeat it here.

But, I have saved enough money to take a year off and travel with my wife. We're both 29.

Separately, we're selling our house and putting the profit in a CD or some other guaranteed return investment. We won't be spending a dime of this money on the trip.

If everything goes according to plan, when we get back we'll have enough to put 20% down on a bigger house and still have 2-3 years of mortgage payments in the bank.

A little of 1, 2 and 3, HOLLA.