3 ms·

Real wealth is not having debt.

devonkim 9y ago
I have no debt, some liquid assets, but still rent. I know I'm better off than a lot of the country but being in the top n% of income in the wealthiest country in the world but enjoying little of the amenities besides basic infrastructure seems difficult for me to think of myself in any way as "wealthy." Unencumbered is ahead of many but I think I'd far rather have $400k income (and, more importantly, the social status and connections that kind of occupation or niche implies) with $1MM in debt than some low six figure income with much more in common socially with the homeless and nonfunctional mentally ill.
- fuzzfactor 9y ago
  With the increasing number of the middle class including full-time workers becoming homeless (especially now in Houston) some homeful people would be best to become less rejecting of the homeless and/or mentally affected who lost traction before them. Especially in such a case where it's so obvious that there but for the grace of god they go. Regardless of natural disaster or not, the prevailing cutoff line is coming after your low six-figure income, since there's not much foundation remaining below that level. If you are providing shelter or a more extensive domestic environment those are not functionally very much like six significant figures anyway, but you knew that.
clairity 9y ago
that's not right. real wealth is having a low cost of capital. the wealthy tend to carry debt because it's plentiful and cheap for them. access to cheap money gives them access to better returns than the average bear. if you are not wealthy, debt is expensive and not nearly as rewarding. but having debt, of course, doesn't imply you are wealthy.
closeparen 9y ago
Nah. Someone with $25k assets and $20k debt is substantially wealthier (i.e. can use their money to accomplish more purposes) than someone with only $5k. Having a major asset (like a house) owned outright might be closer to "real wealth" territory.
- fuzzfactor 9y ago
  Not always true when someone having only $25K in assets is servicing a challenging $20K debt. Someone else without debt having $5K in cash can sometimes jump at an opportunity that would be completely out of reach for such an encumbered debtor. They usually wouldn't have the $20K debt unless they had already spent all or more than all of their cash at one point, up to approximately $25K already spoken for. Right on target with a house owned outright until the exponential rise in your pesky property tax gains enough momentum to become an actual threat.

I have no debt, some liquid assets, but still rent. I know I'm better off than a lot of the country but being in the top n% of income in the wealthiest country in the world but enjoying little of the amenities besides basic infrastructure seems difficult for me to think of myself in any way as "wealthy." Unencumbered is ahead of many but I think I'd far rather have $400k income (and, more importantly, the social status and connections that kind of occupation or niche implies) with $1MM in debt than some low six figure income with much more in common socially with the homeless and nonfunctional mentally ill.

fuzzfactor 9y ago
With the increasing number of the middle class including full-time workers becoming homeless (especially now in Houston) some homeful people would be best to become less rejecting of the homeless and/or mentally affected who lost traction before them. Especially in such a case where it's so obvious that there but for the grace of god they go. Regardless of natural disaster or not, the prevailing cutoff line is coming after your low six-figure income, since there's not much foundation remaining below that level. If you are providing shelter or a more extensive domestic environment those are not functionally very much like six significant figures anyway, but you knew that.

clairity 9y ago

that's not right. real wealth is having a low cost of capital. the wealthy tend to carry debt because it's plentiful and cheap for them. access to cheap money gives them access to better returns than the average bear. if you are not wealthy, debt is expensive and not nearly as rewarding. but having debt, of course, doesn't imply you are wealthy.

closeparen 9y ago

Nah. Someone with $25k assets and $20k debt is substantially wealthier (i.e. can use their money to accomplish more purposes) than someone with only $5k. Having a major asset (like a house) owned outright might be closer to "real wealth" territory.

fuzzfactor 9y ago
Not always true when someone having only $25K in assets is servicing a challenging $20K debt. Someone else without debt having $5K in cash can sometimes jump at an opportunity that would be completely out of reach for such an encumbered debtor. They usually wouldn't have the $20K debt unless they had already spent all or more than all of their cash at one point, up to approximately $25K already spoken for. Right on target with a house owned outright until the exponential rise in your pesky property tax gains enough momentum to become an actual threat.