How Wealthy are you?

suki1964

As long as I have a roof over my head, food on the table, heating and a bit of a social life, wealth means !!!!!! all to me

Cant take it with you and who wants the biggest headstone in the graveyard after all

capital0ne

BBH123 wrote: »

. But that is rubbish given that houses in London and SE can easily be more or less equal to that

You've misunderstood the table, the text preceding it says: "excluding physical possessions" means houses are not included.

I'm a baby boomer gen and in the top 80% like most of my age group I would think.

londoninvestor

capital0ne wrote: »

You've misunderstood the table, the text preceding it says: "excluding physical possessions" means houses are not included.

Not sure about this. "Possessions" generally means chattel / moveable property, not real estate.

And if you look at the materials from the ONS (who compiled the survey the BBC article refers to for the table we're talking about), it includes property:
https://webarchive.nationalarchives.gov.uk/20160105200001/http://www.ons.gov.uk/ons/rel/was/wealth-in-great-britain-wave-3/2010-2012/info-wealth-and-assets-survey.html

Of course it's net wealth, so any mortgage debt will be deducted.

Audaxer

DairyQueen wrote: »

We have every intention of spending as much of our capital as possible.

I can understand that, but I've been wondering how you run down capital without the risk running out of money if you live longer than expected?

System

capital0ne wrote: »

I'm a baby boomer gen and in the top 80% like most of my age group I would think.

Congratulations on being in the top 80%. You are not usually so modest!

MaxiRobriguez

DairyQueen wrote: »

We have every intention of spending as much of our capital as possible. Our heirs will benefit only through happenstance. I would be interested in hearing from those who are ring-fencing assets for inheritance. The report assumes that Gen X will inherit big-time. Really? I wonder on what basis they concluded that?

Your children face much harder challenges than you will ever have done is the unfortunate truth.

The report probably concludes Gen X / Millennial will inherit big time due to the combination of property prices soaring and final salary schemes. Older people (on average) won't need to move out of the home as much as previous generations given a combination of more wealth and access to healthcare facilities in the home. With the property not being sold, the younger generations will have more to inherit.

Unfortunately for them it's going to come too late as their families will have long been started - perhaps the children themselves will have already moved out.

rnj

"The wealthiest person is the person who wants the least, not the person who has the most"
Said by a poor person presumably, although I try to take comfort in that quote.

adonis10

Audaxer wrote: »

I can understand that, but I've been wondering how you run down capital without the risk running out of money if you live longer than expected?

Surely it can't be that hard; establish a comfortable level of income for the basics (housing, clothing, food, occasional holiday etc.) and then see what is left over and spend x% of it accordingly on whatever floats their boat (expensive hobbies, cars, lavish holidays etc.). If they then live longer than planned they will still have the regular income to deal with the basics but not the excess for the lavish extras.

danm

the clearest reason to include property in the calculation is one that applies to me.


I recently decided to pay a large amount (X) off my mortgage (pretty much to zero) - before that the amount was in cash.


To not include property equity would imply that my wealth just fell by X, which is clearly wrong. In fact, peace of mind that my home is my own has made me whealthier (did I just invent a new word!)

MaxiRobriguez

danm wrote: »

the clearest reason to include property in the calculation is one that applies to me.


I recently decided to pay a large amount (X) off my mortgage (pretty much to zero) - before that the amount was in cash.


To not include property equity would imply that my wealth just fell by X, which is clearly wrong. In fact, peace of mind that my home is my own has made me whealthier (did I just invent a new word!)

Which makes sense but the opposite direction of freeing up cash from the house gives reason not to include it, namely that the vast majority of people selling the how won't see a net benefit in cash terms. They'll either move to a more expensive house, a house of equal cost or they'll use the house to fund nursing home costs. Only a subset will realise the cash with a move from larger to smaller or more expensive region to cheaper. Most people shouldn't count home equity as wealth.