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How do you measure your wealth more accurately?
- Thread starter FATCA
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once you realize your wealth (economic power and setup to use it) is an extension of your body fat and muscles (i.e. storage of energy and power projection apparatus) you'll see that the answer is strictly subjective (dependent on you preferences and goals) including the urge and unit of measurement
If you can live off your wealth solely from interest and returns, then you’re rich, otherwise, you simply have a lot of money. That’s how I measure it.
some things beside the obvious measured in $, btc, and after we have accumulated plenty of the former :
number of children (and their character, virtue, etc)
physical health (max pullups, pushups, vo2 max, free testosterone etc)
spiritual health (inner peace, lack of stress, state of soul/relationship with God, etc)
material wealth (land, priceless objects/art, family heirlooms, ancestral property)
esteem (titles, awards, prizes, recognition, or even personal achievements nobody knows about)
being part of a community or sub-culture, sense of belonging, friendships, shared values, etc)
having a mission, purpose that will keep you driven even after achieving financial wealth
number of children (and their character, virtue, etc)
physical health (max pullups, pushups, vo2 max, free testosterone etc)
spiritual health (inner peace, lack of stress, state of soul/relationship with God, etc)
material wealth (land, priceless objects/art, family heirlooms, ancestral property)
esteem (titles, awards, prizes, recognition, or even personal achievements nobody knows about)
being part of a community or sub-culture, sense of belonging, friendships, shared values, etc)
having a mission, purpose that will keep you driven even after achieving financial wealth
If these issues trouble you, it suggests you might be focused on the foundational levels of Maslow's hierarchy of needs—specifically the physiological or safety stages.
https://en.wikipedia.org/wiki/Maslow's_hierarchy_of_needs
"How to measure wealth?"
Though I hated & scored poorly in Wharton Accounting courses, in later life my basic understanding of balance sheets and accounting turned out to be more important than any other intellectual asset. In evaluating deals and future profits from businesses I was involved in (or rejected), a good knowledge of accounting was needed. But the question here is "How to measure wealth?"
You first choose the medium: For Americans it is usually dollars. Europeans use Euros. But some prefer gold, Swiss Franks or other relatively stable things to measure their wealth . To measure their wealth, they compare it's growth or decline year to year. With the accountant mentality, normally they'd prepare a balance sheet (showing assets less liabilities expressed in the chosen medium) twice a year, typically on 1 January and 1 July. The volatility of BTC makes that a poor , inefficient way to measure wealth.
What is wealthy?
That is an entirely different question, but as a kid in Wharton, the maxim was,
You are not wealthy until you have enough to live comfortably on the interest on your interest.
What does that mean? If the going interest rate is say 5% and you need $200,000 to live comfortably, if you cashed out all your diversified assets and put the proceeds into good interest bearing bonds, you'd need about 800,000,000 to have "generational wealth."
I'd round that off to a Billion Dollars worth of assets to be on the safe side.
Though I hated & scored poorly in Wharton Accounting courses, in later life my basic understanding of balance sheets and accounting turned out to be more important than any other intellectual asset. In evaluating deals and future profits from businesses I was involved in (or rejected), a good knowledge of accounting was needed. But the question here is "How to measure wealth?"
You first choose the medium: For Americans it is usually dollars. Europeans use Euros. But some prefer gold, Swiss Franks or other relatively stable things to measure their wealth . To measure their wealth, they compare it's growth or decline year to year. With the accountant mentality, normally they'd prepare a balance sheet (showing assets less liabilities expressed in the chosen medium) twice a year, typically on 1 January and 1 July. The volatility of BTC makes that a poor , inefficient way to measure wealth.
What is wealthy?
That is an entirely different question, but as a kid in Wharton, the maxim was,
You are not wealthy until you have enough to live comfortably on the interest on your interest.
What does that mean? If the going interest rate is say 5% and you need $200,000 to live comfortably, if you cashed out all your diversified assets and put the proceeds into good interest bearing bonds, you'd need about 800,000,000 to have "generational wealth."
I'd round that off to a Billion Dollars worth of assets to be on the safe side.
Correct. The interest on 800,000,000 at 5% would be 4,000,000 and the interest on that would be the 200,000 you needed as interest on your interest. I wanted our readers to have to THINK a bit, and you did! Pete
PS: I just did a proof-read revised version of what I wrote earlier, which can be deleted.
How to measure wealth? And "What is wealthy?" Do you have an opinion on that topic?
"How to measure wealth?"
Though I hated & scored poorly in Accounting courses, in later life my basic understanding of balance sheets and accounting turned out to be more important than any other intellectual asset. In evaluating deals and future profits from businesses I was involved in (or rejected), a good knowledge of accounting was needed.
But the question here is "How to measure wealth?"
You first choose the medium: For Americans it is usually dollars. Europeans use Euros. But some prefer gold, Swiss Francs or other relatively stable things to measure their wealth. To measure wealth, they compare its growth or decline year by year. With the accountant mentality, normally they'd prepare a balance sheet (showing assets less liabilities expressed in the chosen medium) twice a year, typically on 1 January and 1 July. The volatility of BTC makes that a poor, inefficient way to measure wealth.
What is wealthy?
That is an entirely different question, but as a kid in Wharton, the maxim was,
You are not wealthy until you have enough to live comfortably on the interest on your interest.
What does that mean? If the annual interest rate is say 5% and you need $200,000 to live comfortably, if you cashed out all your diversified assets and put the proceeds into good long term interest-bearing bonds, you'd need about 800,000,000 to have "generational wealth."
The interest on 800,000,000 at 5% would be 4,000,000 and the interest on that would be the 200,000 you needed as interest on your interest. I want our readers to have to THINK a bit,
I'd round that off to a Billion Dollars’ worth of assets to be on the safe side.
"Grandpa" 1 April 2025
PS: How much is enough for you? That is purely objective.
For me, I'd say enough to live on (including medical & all other expenses)
without working until age 110 (maximum future lifespan).
Question: How about for you?
How to measure wealth? And "What is wealthy?" Do you have an opinion on that topic?
"How to measure wealth?"
Though I hated & scored poorly in Accounting courses, in later life my basic understanding of balance sheets and accounting turned out to be more important than any other intellectual asset. In evaluating deals and future profits from businesses I was involved in (or rejected), a good knowledge of accounting was needed.
But the question here is "How to measure wealth?"
You first choose the medium: For Americans it is usually dollars. Europeans use Euros. But some prefer gold, Swiss Francs or other relatively stable things to measure their wealth. To measure wealth, they compare its growth or decline year by year. With the accountant mentality, normally they'd prepare a balance sheet (showing assets less liabilities expressed in the chosen medium) twice a year, typically on 1 January and 1 July. The volatility of BTC makes that a poor, inefficient way to measure wealth.
What is wealthy?
That is an entirely different question, but as a kid in Wharton, the maxim was,
You are not wealthy until you have enough to live comfortably on the interest on your interest.
What does that mean? If the annual interest rate is say 5% and you need $200,000 to live comfortably, if you cashed out all your diversified assets and put the proceeds into good long term interest-bearing bonds, you'd need about 800,000,000 to have "generational wealth."
The interest on 800,000,000 at 5% would be 4,000,000 and the interest on that would be the 200,000 you needed as interest on your interest. I want our readers to have to THINK a bit,
I'd round that off to a Billion Dollars’ worth of assets to be on the safe side.
"Grandpa" 1 April 2025
PS: How much is enough for you? That is purely objective.
For me, I'd say enough to live on (including medical & all other expenses)
without working until age 110 (maximum future lifespan).
Question: How about for you?
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