To ask if you're wealthy, how did you acquire your wealth?

[PinataHeeHaw]

I'm sat here in the early hours looking at luxury Spanish villas, wondering how I've never got rich.

We are very comfortable, whilst my husband built up his business my wages covered all bills. We both worked hard so that we could retire together, hubby is 10 years older then me and his health was beginning to fail, a few years back he was offered a ridiculous amount of money, which we took and retired together. But I think that I am wealthy as I have a beautiful home, a good car, a fantastic husband, and wonderful children. Others might consider wealth as money but I look at it in a different way after nearly losing my husband.

Inheritance tax is now an eye watering 40%.

Hasn't it been like this for years? You can still inherit up to the maximum of 1m depending on circumstances before you pay 40%.

I'm sure I read recently that all the billionaires under 30 in the world are because of inheritance, none are self made.

I want to do my MBA, but I have no support network, my kids are SEN and cant be in after school clubs or with childminders and I can't not work to pay the bills. I enquired with the cambridge judge business school and they were really interested in me applying due to my work history but I can't. So stuck.

I also think it's a lot hard to
acquire wealth these days if you are under 40 vs those who did it in the past. Wage stagnation, property, COL etc means it's generally harder to make money or have spare to invest.

@Crazybaby123i believe you and it sucks

We have both had successful careers. To date, I have inherited £250k from my father and grandparents combined. DH started with nothing but has had a very successful career.

I am an only child of two only children.

The most important factors have been good health so far, we are mid sixties, and we have both married once and have stayed married.

We reviewed our wills this week and have added a clause. At present if we and both children went together, all we have are DH's siblings. I have no-one: no siblings and no cousins. It felt rather sad. My mother is close to two of her cousins from her father's closest brother. If the chips go down our estate would be divided between their issue and DH's siblings.

The wealthiest people I know work in good professional jobs, are always careful with money (not interested in latest phones, gadgets, moderately priced car) and never had children.

I don’t think that’s going to be true. An awful lot of the work than an actuary does at the moment is about to be replaced by AI. It’s one of the jobs most at risk.

I think people have such wildly different ideas of what wealthy means. Is it three months savings? Is it 100k in the bank? Is it 10M in the bank and several properties?
Most live paycheck to paycheck so very modest savings may make some feel wealthy.

Meaningful money podcast and Facebook group are a fabulous resource. Basically pay off all debt, build a savings pot to cover 6 months expenses if lost your job, put a good chunk in SIPP pension and / or company pension and then invest in stocks and shares ISA in a diversified fund, never individual stocks and shares. Leave the funds well alone and don't touch for min 5 years as the stock market goes up and down but the overall trend is up

What’s wealthy these days? We have good annual household income (£300k) from businesses we started from scratch 20 years ago. Businesses are worth about £30m now.

Was tough at the beginning, I went to state grammar then uni and worked in a professional role when I met DH, he was in a low paid manual job at the time. He wanted to start a business, I supported him, he didn’t do uni, came from a very poor background overseas (grew up in a house with no running water). He always had a great work ethic, between us we just about got by for the first ten years or so, reinvested any spare money back into the companies.

Was a big risk really, we put so much into it. Didn’t buy our first house until late 30s. Had kids and I never went back to my career but worked in the family business instead. Last ten years been pretty good (Covid was tough). DH wants to retire at 50 (5 years to go) then looking at buying property in a few countries and moving abroad once kids are both at uni/work.

@SomethingFun , if you enjoy reading, I would recommend Investment made Easy by Jim Slater. It was published in the 1990s so you can safely ignore all the detailed calculations, but the overarching strategic narrative is still a useful framework. Probably only available on Kindle now though.

Hard to say but an elephant in the room regards wealth accumulation is to not divorce

I know a lot wealthy people who have to taken major financial hits due to splitting up.

It’s funny we were discussing this last night. Very wealthy people don’t divorce because they never married for loving the first place. It always was a business transaction.

And very poor people don’t divorce because they can’t afford to
It’s the one in the middle that get decimated. And those are the ones that the lawyers on as well because they convince both parties that they’re just not quite intelligent enough to deal with it themselves.

Yep. I’m now wealthy after building a business for 30plus years then selling it. No family wealth at all and bought my first house aged mid 50s.
how I did it ? Happy with risk taking, absorbing the shit times, coping with crazy stress at times, being creative, having an innovative mind - oh, and ADHD although I didn’t know that at the time. I could buy that villa abroad with cash and not notice. But I don’t want to - in fact I feel guilty and unhappy with the money I now have.

What gives me pleasure and satisfaction is knowing I’ve created good stable jobs for many people, that my business has in a small way made the world a better place (ie it Does Good Work), and over all of that, that my children will be financially secure all their lives.

Yes that’s fair and I also know one couple who have £10s millions through starting a company.

I'm not wealthy (I wish!) but I'm in close proximity to people who are. They are all from immigrant families, all extremely low key, make sacrifices that the majority of people wouldn't even consider and think of the very long game. Not one of them looks overtly wealthy in terms of status items and they still look out for ways they can save more. They feel very proud about yellow sticker food items and when going to their homes overseas they wait for the cheapest (budget) flights. They have no desire whatsoever to show off, quite the opposite really! I'm reading The Psychology of Money now and it is them to a T.

We have a villa in Spain on just over 7 acres and our main home is an ancient wreck of a farm in France that we're renovating. Both mortgage free.

Isn't it incredible that people are so immune from the implications of what inheritance actually involves!! That it's the death of someone close who has left money in their will.

this is why these threads are really crass and distasteful, "wealth" shouldn't boil down to money in bank accounts, house, car, inheritance. Society has bloody well lost its way when that's how they associate it.

@curious79 there is too much of people thinking ‘well it’s not gonna make any difference so why bother’.

Nail on the head there. So many people have no comprehension of how lots of small things can add up or how small things persisting for long periods of time makes a massive difference. As said by a few people, compound interest is everyone's friend and small amounts saved regularly from a young age will grow massively over a few decades. Such a shame that schools only "teach" the mechanics of compound interest in algebraic terms and don't put anywhere near enough emphasis/illustration on real life examples.

It's a shame that it's not generally the norm for older relatives to help out the younger ones in traditional British society, when they actually need it, i.e. to buy a home, set up a business, etc. There's too much of the old fashioned attitude of "you'll be grateful when I've gone" as they salt away monies they'll never need themselves.

Some ethnic communities have a much healthier attitude and help their children, nieces and nephews whilst they're alive and when the children actually need the help to set up their adult life. Youngsters from some ethnic communities don't need to take out bank loans or work in minimum wage crap jobs - they get given/loaned money from older family to set up businesses, or allowed to use an elder relative's shop or industrial unit free of charge to start their business, etc. It's all a matter of looking after their own community and their own wider family, rather than just sitting on piles of cash earning interest whilst their younger generation struggle.

It's a shame we can't tweak our tax laws etc to encourage giving whilst your alive rather than after you die.

I've lots of clients from immigrant/ethnic families and I agree with everything you say.

But that's also the way I live my life. I have money, but am careful about what I spend it on. It comes from younger life when we had nothing, no holidays, a clapped out old car that kept breaking down, ice on our bedroom windows, etc. When your formative years are like that, you quickly understand the true value of money. When I started work, it was a full time crap job on less than £1 per hour - I had to carefully plan - made my own packed lunches because I couldn't afford sandwich shops, would plan which week of the month I could buy a new top or pair of trousers, plan car journeys around when I could afford to put fuel in it, etc. You don't lose that kind of budgetting/planning even when you don't need to keep spending down.

I'll happily have a blow out buying a brand new car every decade or so, having the occasional expensive holiday (last was a cruise for £10k), etc., but it's not the norm, and I shop around and get deals when I spend anything, whether a brand new car (usually 10-15% off list price by shopping around and haggling), cruise would have cost £20k at a different time of year, and by using a different airport, etc. I think carefully and shop around for every pound I spend. Just because I spent £10k on a cruise doesn't mean I'm not going to buy yellow sticker items if available, or that I don't rotate between supermarkets to buy multipack crisps where they're cheapest. It's amazing how much savings you can accumulate over the years just by being careful and shopping around, and you still get what you want, without actually doing without anything.

Yes they do try to set their dc up for life, but there is also the expectation that the dc and subsequent dgc will look after them in their old age. I think the vast majority of 'traditional British society' would rather do without the trickle down than to be saddled with their bedbound, incontinent parents/IL's living in the dining room that had to be converted into a bedroom. You can't have it both ways!

I understand that point of view, but the vast majority of elderly people don't end up incontinent nor bedbound, just like the majority don't end up in care homes.