To ask if you are rich, and if so how you made your money?!

[jinglebelly]

I run a small ebay business but after DC 3 starts school I'd either like to retrain/get a degree or start up a larger business... I don't know any very well off people hence why I'm asking on mumsnet!

Pia, lovely to hear from you again. You came back to insult me. Insults are the last bastion of someone who is losing the plot.

Sorry me again ... something I should add is a willingness to learn from your mistakes and bounce back.

My key defining moment was when I flunked my A levels as I was distracted by other things and saw other friends going off to better universities whilst I had to accept a place at a local Poly. So at Poly, I sat additional A levels so that my CV would have glowing A level grades, as well as studying for my degree. That helped me to secure a place on a good graduate training scheme.

Since then, I've never let myself down again and I think I've managed to close the gap in terms of where those schoolfriends are now with their careers and in some cases have surpassed them.

Pia - sorry to say this but you do come across as a bit chippy!

Anyone my twopennorthworth on wealth creation - work hard and make the 'right' choices, by 'right' I am not talking job satisfaction but where the filthly lucre.... if that floats your boat...

Cointreau, I know someone whose husband does that too! Your friend's dh is obviously more successful than my friend's though!

Has anyone here who is "richW" become so through having a Really Good Idea or spotting a gap in the market for something? Over the years I've had a few ideas which were laughed out of the water, only for them to have become money makers for someone else. Should have had the courage of my convictions I guess.

"A friend of mine is very well off; her husband is a "professional gambler" "

I've got a friend who does this. It's tax free income as well! However, he gets annoyed as a lot of people think he spends all his time in the pub, whereas the reality is that he spends most of his time studying spreadsheets, looking for arbitrage opportunities and building his risk models. It's pretty boring a lot of the time, or at least, no different to working as as an accountant/analyst etc.

Ok, so to summarise so far, it seems that, apart from marriage or inheritance, the consensus on how to get rich (as opposed to comfortable)is

1. Start own business which is scaleable and and which has a sustainable competitive advantage. These 2 factors are critical, otherwise you cant expand and you'll be subject to competition which will reduce your pricing power.
2. If not, become a hedge fund manager, investment banker, city lawyer, or get high up in accounting/tax (partner) or medicine (consultant).
3. In either of these options, be prepared to work very hard and sleep on planes a lot.

Plus reinvest proceeds of the above wisely and do not buy Choos, coke or bankroll feckless partners/family etc. Educate yourself on the basics of investment - e.g. the difference between cash/bonds/equities. It's never been cheaper or easier to invest and you need to take some risks to accumulate wealth. Holding savings as cash will do little more than counter inflation. If you want actual growth, you need to consider bonds or shares.

UK property has historically been a winner but I think that train's left the station now. I don't expect 20 yr olds to see a big property appreciation in their lifetime. However, if you're committed to living in the UK, it's still worth getting on the ladder as early as possible.

Shandy, my aunt isn't rich yet but I suspect she is well on her way to being very comfortable (rather than hedge-fund minted) because she spotted a gap in the market.

She has a quite expensive hobby that is generally pursued by wealthy people, and noticed that everyone had to wrap their equipment in bubble wrap to transport it. She though duh, why don't I make cases for this equipment? and set about it.

She wouldn't have got where she is, though, without my DH helping her out for free. He runs a consulting firm that can find suppliers in China, so he did all the back-and-forth with the factory to get things exactly right. In turn, DH wouldn't have been able to get his company up and running unless I'd been earning a steady wage that was more than enough to support us both. I suspect most entrepreneurs will tell you that family support is really important.

The right idea is only half the issue. Support to get it off the ground is the other half.

Sorry, I should clarify that the point of emphasising that most people who do this particular hobby are fairly well-off is that they're willing to pay between 300-600 for a case for their gear. It wouldn't have been such a good business opportunity to service a cheaper hobby (unless millions and millions of people did it).

well, in support of the merely salaried.....

it does help to have a job that pays well. but really its what you do with the money you earn that counts.

DH and i do not come from financially savvy families and certainly dont and have never had any financial help.

in fact, the opposite. we support both sets of parents.

we both started out with fairly low salaries and worked our way upwards to better paid roles (DH within his field, me any job anyone would give me!) but there is a definate cap on our earning abilities.

so we set about educating ourselves in finance, subscribed to things like money week, and then started investing our very tiny savings. and i mean tiny. our first foray was using 150 quid it took us months to save.

and someone has mentioned being happy with delayed gratification. this has made things immesurably easier for us. it took me 3 years to save for a watch a really wanted, and it didnt bother me to wait. even though i could actually have bought it cash straight away, it didnt make sense financially to do that when that cash was working for me elsewhere.

which is basically what i wanted to say. the important thing is to make your money work for you. so that you are acumulating. and this takes time, effort and alot of energy and interest.

DH and i often disagree about wether we are rich or not, he says not i say we are! because i compare us to everyone, and he only compares us to people who have more money than us! lol

TheBride's summary is where we had got to.
Although I've talked about working very hard and consistently plenty of us who earn a lot also have the time and flexibility to be with our families. If you run your own show and work for yourself you decide those things. It is hugely easier for me now in my late 40s than when I was 26 very junior in the City with 3 children under 4 and both of us working full time. You have no control at junior or even employee level and usually less money.

There were a few posters who came over as little fed up or who were depressed not to have had family help or money to fall back on but a lot of us haven't had family handouts. Whilst they were alive (now dead) I never asked my parents for money. I hope my children (oldest 3 have graduated now) will also make their own way. Most parents know that giving young people lots of money is a disincentive and that an element of struggle is what ensures they can get thri kicks in having saved up for the car or ipad they wanted rather than having to seek a high in cocaine or whatever. It's why plenty of very rich people of which I'm certainly not one, don't intend to give a lot of their money to their children particularly when they're young.

On the question of why people don't want to admit they are rich it's just because it's relative. As I think my very first post on the thread probably said the richness most of us have at whatever income level will be our good health, happiness and lovely children and loving relationships with others not money at all. however on a thread about money most of us wil know if we earn the minimum wage ( about £13k full time), above the average wage whihc is about £22k depending where you live in the country or have reached the dizzy heights of paying 40% tax or whatever, what we have for savings, assets, income and the like. I don't look around thinking XYZ has more than I have how awful aren't I hard done by. The road of envy is a road that doesn't lead to happiness. If you can take pleasure in your work and also do the suggestions above of picking work which is more likely to be better paid than others then that can make life easier.

Most of us know if we choose to leave school at 16 to become a cleaner we might earn less than if we read medicine at Cambridge although even with cleaners there are a few who have built up massive UK-wide cleaning agencies and make more in a week than doctors earn in a year (but statistically less chance).

I'd love to work in the City as I've always had a flair for working with numbers and for some strange reason banking has always interested me.

Unfortunately, I left my degree course half way through and it would appear that the only way to get your foot in the door in the City is by having a degree. At 31, I believe this is now no longer an option.

To add to that list - you can make a very good living as a financial adviser. Three hundred thousand P.A. (bolstered by trail commission) if you're good at what you do

So I'm told....

The families with inherited wealth have done very well to ensure the children are not overly spoilt, soft or 'gone to seed'. They have all grown to be successful in their own right. So it's not always bad.

Many do live in beautiful central city locations in properties that others would have to work many, many hours to obtain (if ever). It looks like a nice life to me I must say.

They also take professions due to interest, whether it be law or something else, which is good.

So it's not all trust fund hideousness out there.

I agree with Xenia it must get easier as you move up the ladder.

Because having money is much more fun than not!
Especially if you have expensive tastes/hobbies.

Oh come on - it did sound a bit like a question!

I agree with the summary by The Bride and would add in the observation that those who do well in option 1 (self made route) tend to be those people who have spotted a product or service offering gap in the market and monetised it. Usually its obvious to us all after the event but the rest of us either don't have the ideas or the balls/power of conviction/resources/will power/dedication etc to turn it into a successful business.

As to the comment that to be this successful must involve neglecting of children in some way. In my case I prioritised my career in my 20s so that I would be in the position to prioritise family as best I couid when I had dc. In reality that means I work part time and also work from home one day a week. On the days I do go into the office, I make sure I spend about 1.5 hours with dd in the morning. I leave work in good time to ensure I spend another 1.5 hours with her. I would imagine that 3 hours a day on working days is no different to other wohm. I am up early, showered and dressed and have responded to overnight emails before she is up, and in the evening, I work after she has gone to sleep and dh and I have had supper together. I have found, as Xenia said that if you run your own show then you have the flexibility to decide how you balance your working and family lives.

Most people who are well off at my stage (late 40) who are still carrying on working do it because they like what they do. I think it's marvellous that I can sit here enjoying the work I'm doing this morning and being paid for it, more than I enjoyed lying in the sun yesterday. I'm very lucky. I am not even sure I desire wealth although I'd like to get mortgage free again. I wanted to be able to afford school fees and a reasonable house and holidays but I've no desire for expensive clothes or cars or furniture, more than happy eating Tesco caged eggs and value chickens, drink tap water etc. The things that have made me most happy apart from work have been things like being pregnant, breastfeeding, loving babies, being with family, library books, walks Even my island abroad is more about simplicity, privacy and is certanily not luxury.

The times money has concerned me have been when we've earned less than we paid out - Cieckens was right about the Micawber Principle:

"Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery." 

We do of course as a culture (as does every culture) measure people by what they earn (or how many beads they have on their jungle necklace or whatever your currency is in your culture) though.

WibbbelyBibbley- you have pretty much put your finger on my life! im 25 and i already feel like il just have to wait for the next life time-delfinatly wont be making the same mistakes and il be sure to call social services and demand they remove me from my family home!

Xenia- where abouts in the world is your island?

im quite pleased i have an allotment-its my island! shame its about to be ripped from me and sold off for housing. much love to our great leader.

The Bride "UK property has historically been a winner but I think that train's left the station now. I don't expect 20 yr olds to see a big property appreciation in their lifetime."

Not at all! I've generally made money out of buying cheap properties with things wrong with them and selling them for more, rather than capital appreciation. There are still properties like that around, although more development type opportunities rather than just doer-uppers. I've just offered for a property today that I think has got at least a couple of hundred thousand profit in it, but its a very specialist type of niche market and just isn't presented properly and needs some tarting up money spent on it. The rental market is also excellent just now, but again I specialise in a particular niche of that - thats not to say it couldn't be adapted to a different sector if the market dictated that.

Its actually a really exciting time for property development right now. There are more bargains starting to come up than for a long time. I literally can't wait to get reading all my sources of properties for sale when they come in.

Interesting the comments about inherited wealth. I notice that my genuinely posh tenants are very rarely given such sums by their families - they may get their educations paid for but they don't get bought smart cars or flats to stay in at uni and are expected to be independent and make their own way rather more than people like some of DP's more working/middle class frends and relatives with wealthy parents. Entrepreneurialism is looked upon as aspirational amongst the posh now in a way it is not amongst the less posh (struggling to find terms to use instead of class based terms).

Again, I have far less trouble from these tenants in terms of phoning me up to complain small things are broken than I do from another flat I rent out in another city to tenants from a less exalted background. My posh tenants generally just fix it themselves or let me know in a relaxed manner, while the other tenants panic if something like the central heating won't start. OK, not all of them, but I have had a few. I'm certain this is because the more the parents spoil the child, the less they are able and willing to do for themselves.

I'm also sometimes surprised at how little people do to help themselves or get their hands dirty. I bought a two bed period semi at the height of the over-inflated market 7 years ago for (I kid you not) £20,500 and sold it 9 months later for many times as much. No-one else wanted it, yet all that was wrong with it was that it was a bit dirty and had the floor taken out due to dry rot (which made my job easier). Yet the local papers were full of young couples moaning that they couldn't afford to get on the property market in that area. Of course they all wanted 4 bedroom new build detached houses straight away.