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  • It Costs A Lot Of Money To be Rich....

    Sometimes I am surprised how much we spend on an average month, just on regular everyday things.......food, gas, taxes, electricity, heat, water, clothes, insurance, telecommunications, entertainment, etc. etc......

    We're getting on....paid the bills, settled in. We're fortunate. We live a decent lifestyle. But I'd say that we are modest in our approach to living. And when you are near full retirement, you need to know how much you spend and how much you will bring in, and ideally there will be a surplus at the end of the day.

    People who spend a lot on house(s), cars, cottages, vacations, memberships, entertainment and so on, things befitting of wealthy means, must have enormous monthly cost. Sure, they "apparently" own material things, but even so, the ongoing cost of owning is tightly linked to quantity/size/value/required maintenance. Paying for utilities (alone) for what they own is incredibly more than what I pay. And things need to be maintained.....and that usually means ongoing repairs/upgrades, plus you may have to factor in the added pain (in the wallet) of having "quality" over standard.

    ~~~~~~~

    It should be noted that I am not focussing this discussion about going into debt and such....that's part of this, but the depth of that topic is best served by another thread. But for the sake of this article, please make sure you understand the "what you owe" part, and make that a priority in your cost column.

    ~~~~~~~

    And in no way is this about disdain of any kind for wealthy folks. They may have earned every cent of it, and if so, good for them. They may be the business person who has hired extra people, and have therefore improved the economy and the lives of those hired. And even if they inherited it all, that's the nature of the world we live. I hope to pass on some to my kids as well. No....this has everything to do with understanding the cost of living, and more important, the future cost of living......when perhaps the revenue streams are diminished.

    Again, I can't complain. We've had it pretty good. If anything I could impart, learn more about the added cost to things you purchase. Try not to get into a purchase price mentality. And when you get closer to retirement (which most of you probably have no reason to even consider at this time) try to visualize future revenue vs future cost. Maybe trim some things along the way.

    Sorry......didn't mean to rush anyone along. After all, life should also be spontaneous to some degree, and people deserve to blow some cash here and there, because life is too short otherwise.
    :thumb:

    (Enjoy the ride!)
    Last edited by CanDB; 09-21-2011, 11:45 AM.

  • #2
    It sure does cost a lot to be rich. Look at that politician who owns the Subways and FedEx... he grosses about $6 mil, but nets about $400k.. talk about a lot of expense to make a few bucks!
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    • #3
      It is kind of crazy seeing some people's houses as you drive through Parker or SaddleRock, vs. some houses you see in Norther Aurora or NorthGlenn.

      The costs of taxes, utilities, HOAs, upkeep, plus the insurance/gas/payments of the really nice cars inside those 4 car garages? Crazy.

      Even then, there might be people who live in them that still aren't "comfortable" or "quite there yet," but who am I to judge them?

      I think different people judge wealth in different ways, and they are right to do so. Many times it's just the environment they grew up in. They have experienced a certain lifestyle, and either they liked it or they didn't, so that may have a lot of effect on how they choose to make it in their adult lives.

      I think that more people than not can live a lifestyle that they will find comfortable, and it all comes down to priorities. Two different people can have the exact same income, but one can live in a beautiful house, while the other lives in a cheap apartment, living month to month.

      It doesn't take a genius or an accountant to be able to live the more comfortable lifestyle, just the right mentality. Keep it simple, buy things you can afford realistically, and don't buy things that will trap you in debt for years to come.
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      • #4
        Glad I went to school for accouting to keep myself in check. Being only 23 and looking towards the future benefits alot. Me and my wife are going to be starting the Dave Ramsey program at the start of the year (only reason we are waiting is because of our honeymoon in December). But I ran the numbers already and I would be debt free by mid 2015 with everything but our house, so school loans and cars and credit cards are all gone.

        But I had to give up some things like being able to buy video games and get cool toys, and even gave up satillite to save an extra $60 a month, but it will be worth it in the long run.

        But just looking at the type of money we spend and then looking at how much we make we are doing well, then again we don't spend money on cigs and booze so we save alot because of that lol




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        • #5
          Originally posted by CanDB View Post



          People who spend a lot on house(s), cars, cottages, vacations, memberships, entertainment and so on, things befitting of wealthy means, must have enormous monthly cost. Sure, they "apparently" own material things, but even so, the ongoing cost of owning is tightly linked to quantity/size/value/required maintenance. Paying for utilities (alone) for what they own is incredibly more than what I pay. And things need to be maintained.....and that usually means ongoing repairs/upgrades, plus you may have to factor in the added pain (in the wallet) of having "quality" over standard.

          ~~~~~~~

          It should be noted that I am not focussing this discussion about going into debt and such....that's part of this, but the depth of that topic is best served by another thread. But for the sake of this article, please make sure you understand the "what you owe" part, and make that a priority in your cost column.

          ~~~~~~~

          No....this has everything to do with understanding the cost of living, and more important, the future cost of living......when perhaps the revenue streams are diminished.
          I agree with everything you posted but the title..

          There is certainly rich people that live lavish lifestyles but I would say in almost all of our travels most of the rich people we've met are also the most frugal as well and I think outside of the work they did to get there...They also understood well the last part you posted and understanding that played more of a part then their income on how they got there ...

          That's why I was baffled by the thread yesterday we're some thought a million dollars wasn't a lot of money...Even a millionaire thinks a million dollars is a lot of money

          Also understanding well in all likelihood the avg person on here makes at or way below the avg median household income which if saved properly is enough to live comfortably....

          WO thinking about expenses and savings that is a long way to do go to being considered rich ..
          Last edited by LarryDean; 09-21-2011, 03:00 PM.
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          • #6
            Originally posted by LarryDean View Post
            I agree with everything you posted but the title..

            There is certainly rich people that live lavish lifestyles but I would say in almost all of our travels most of the rich people we've met are also the most frugal as well and I think outside of the work they did to get there...They also understood well the last part you posted and understanding that played more of a part then their income on how they got there ...

            That's why I was baffled by the thread yesterday we're some thought a million dollars wasn't a lot of money...Even a millionaire thinks a million dollars is a lot of money

            Also understanding well in all likelihood the avg person on here makes at or way below the avg median household income which if saved properly is enough to live comfortably....

            WO thinking about expenses and savings that is a long way to do go to being considered rich ..
            I think a million is alot of money, but in regards to that topic to give up the internet at my age a million at one time is alot, but to try to stretch that over the rest of my life with out use of the internet would be the problem. But yes being rich by working your way up is costly.




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            • #7
              I live on $800 a month! Not including tuition...

              I plan to be rich... but I'm not quite there yet

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              • #8
                Originally posted by LarryDean View Post
                I agree with everything you posted but the title..

                There is certainly rich people that live lavish lifestyles but I would say in almost all of our travels most of the rich people we've met are also the most frugal as well and I think outside of the work they did to get there...They also understood well the last part you posted and understanding that played more of a part then their income on how they got there ...

                That's why I was baffled by the thread yesterday we're some thought a million dollars wasn't a lot of money...Even a millionaire thinks a million dollars is a lot of money

                Also understanding well in all likelihood the avg person on here makes at or way below the avg median household income which if saved properly is enough to live comfortably....

                WO thinking about expenses and savings that is a long way to do go to being considered rich ..
                Like to go for the play on words some of the time......

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                • #9
                  Originally posted by #87Birdman View Post
                  I think a million is alot of money, but in regards to that topic to give up the internet at my age a million at one time is alot, but to try to stretch that over the rest of my life with out use of the internet would be the problem.
                  You missed my point ....

                  I didn't care about the internet part of it or what someone would do not do for money .... My point was that during our lifetime and as successful as we'll become and as much money as we'll earn at no point will a million dollars not be a lot of money..

                  I think you understand that though because you explain yourself well in your post in this thread ...

                  Glad I went to school for accouting to keep myself in check. Being only 23 and looking towards the future benefits alot. Me and my wife are going to be starting the Dave Ramsey program at the start of the year (only reason we are waiting is because of our honeymoon in December). But I ran the numbers already and I would be debt free by mid 2015 with everything but our house, so school loans and cars and credit cards are all gone.

                  But I had to give up some things like being able to buy video games and get cool toys, and even gave up satillite to save an extra $60 a month, but it will be worth it in the long run.

                  But just looking at the type of money we spend and then looking at how much we make we are doing well, then again we don't spend money on cigs and booze so we save alot because of that lol
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                  • #10
                    Being an adult is expensive.

                    No more parents, or roommates to help pay for the bills.

                    Rent, TV/Internet, Cellphone, Car Insurance/Gas, Electricity, Credit cards...

                    Uhh.

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                    • #11
                      Originally posted by CanDB View Post
                      Like to go for the play on words some of the time......
                      I only wish I had the ability to do the same

                      One of my first bosses in life an older man classic description of the workaholics from his generation asked me about my 16th birthday and what I got for a present...That it is after all one of the numbers that sets itself apart from the others ...

                      I told him my mom bought me the Giant Size X-Men comic ...Which cost a lot more then then normal 20 dollars I got for my birthday .... I loved it ..

                      He asked me you collect comics ? Needless to say what the older man with hands of stone and a face chiseled by years of hard work and labor thought of it ... He said listen ... I'm going to teach an important lesson in life ....

                      He said during your lifetime you'll have the chance to collect many things... He on the other hand decided to collect what it takes to buy them things ...He told me if your going to collect anything in life start with money...That man through hard work and saving has got more money then his kids and gran kids will ever know what to do with but if he taught them the same lesson I think they'll be ok ...
                      Last edited by LarryDean; 09-21-2011, 04:20 PM.
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                      • #12
                        Live in a modest home that you can easily afford.

                        Pay cash for the cars you drive.

                        Don't buy a boat.

                        These three rules are the key to financial peace.

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                        • #13
                          The problem with trying to figure how much you may need to live off when you retire is the cost of living is just sky rocketing through the roof & there is no way of knowing what you may need.

                          For example: We had our house built in 1999 & it was like $80,000 at the time, it is a 3 bedroom 2 bath ranch with roughly 1300 sq. foot. Fast forward to a couple years ago & there were 3 or 4 new houses that were built just up the street from us & are basicly the same size as ours & those houses sold for anywhere from $140,000 up to $160,000.

                          So that is double the cost in roughly 10 years, so does that mean 10 more years down the road the same type of house will cost about $300,000 ? I'm not sure because that just sounds crazy. And it's not just housing cost, it's everything that is increasing faster than anybody can keep up with.
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                          • #14
                            Originally posted by BroncosFanInPA View Post
                            The problem with trying to figure how much you may need to live off when you retire is the cost of living is just sky rocketing through the roof & there is no way of knowing what you may need.

                            For example: We had our house built in 1999 & it was like $80,000 at the time, it is a 3 bedroom 2 bath ranch with roughly 1300 sq. foot. Fast forward to a couple years ago & there were 3 or 4 new houses that were built just up the street from us & are basicly the same size as ours & those houses sold for anywhere from $140,000 up to $160,000.

                            So that is double the cost in roughly 10 years, so does that mean 10 more years down the road the same type of house will cost about $300,000 ? I'm not sure because that just sounds crazy. And it's not just housing cost, it's everything that is increasing faster than anybody can keep up with.
                            Yeah.. get this.. I purchased a house locally in '02 for $240k. Ended up getting out of it at $395k. Right now, because the market fell, it's at about $250k. Glad I got out when I did.. but also trying to purchase again at the bottom of the market. :thumb:
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                            • #15
                              It's not that hard to figure out expenses to live good. Honestly, I'm at a point in my life right now because of some troubles I ran into where I have to figure out exactly all my income and my expenses. One thing people don't realize is the little things they pay too much for. One thing I've seen for many years is higher ups in company's have no knowledge about saving money. They will spend money on this and that and change this and that and fail at many things that take away income because they don't know the "regular people". I'm in a very tough place financially right now but at the same time it's making me learn and realize all the thing I spent so much money on that wasn't needed at all. I could be a hell of alot better off than I am right now if only I had been smarter about it before now but at least I learned before it was too late. It may cost alot of money to be rich but also that includes dinner with investors, starbucks mornings, nights out, ect. If you are getting a business going or own a good one already if you have an investor to meet with if you want more money for yourself order just a salad but most people get the steak, make your own coffee in the morning instead of spending 5-6 dollars for one cup at an expensive coffee place. I'll be honest I would have trouble not doing the same thing but the way I grew up and have lived my life I would be able to because I went from sleeping on a couch eating Roman noodles everyday to a comfortable lifestyle, but at the same time I had a 6 dollar an hour job washing dishes and still was able to live in a 1 bedroom apartment by myself. That's not exactly easy to do. I understand you have to portray like you have it all and you are the man and wealthy and everything but you can portray that while still living a modest lifestyle. If you break it down if you spend 5 dollars on a cup of coffee 5 times a week that is 100 dollars of needless expenses a month which adds up to 1200 a year, and that's just coffee. If you add up all the thing that you don't need but just enjoy I think you will be able to see the true difference.
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