How Much Asset is considered Wealthy?

Let us today discuss that, How much asset is considered as wealthy? Take the example of a sports star. In our example, this sports star has a net worth of US $ 2 Million and he is earning US $ 4 Million a year. And he spends US $ 3 Million a year. Now, the Question is that, Is this Sports star wealthy?

Well, Technically speaking, he is a millionaire because his net worth is US $ 2 Million. But He is not wealthy according to our definition of wealthy. This is because wealth is considered in time and not in the net worth.

Just think that, if today this sports star stop working than how many years he could maintain the same level of life style? Not even a year right? Because his annual expense is US $ 3 Million and his net worth is just 2 million.

Wealthy means one who if today stops working, can survive and maintain the same level of life style for more than 10 years, probably rest of his/her life.

So if your Net Worth is just half a million dollar but your annual expense is $ 30,000 than you are wealthy because you can survive on your wealth with the same life style level for more than 10 years with this much amount of wealth, probably for the rest of your life.

But a sports star having net worth of $ 2 Million is not a wealthy because he could not survive on his current assets if today he stops working. Always remember that, wealth is counted in Time and not in the Net Worth.

So No Matter How much Net worth you have, your wealthy status depends on how much time you can survive on their wealth without altering the current life style…!!!