A quick and easy definition of monetary wealth

25 01 2012

Wealth is how long you can live without working.  – paraphrased from Robert Kiyosaki

This is a very powerful statement that allows anyone to get a good gauge on their finances.  A few interesting things to note:

  • Someone who can walk into the forest with a knife and survive is infinitely wealthy because they can live forever without “working” (technically getting food/staying alive would be their work)
    Surival Kids GBC game screenshot

    Surviving in the wilderness makes you infinitely wealthy

    .

 

  • If you make 100 million dollars a year and have no savings or assets, you’re dirt poor because if you lost your job you would have nothing to live off.
  • The less it costs for you to live, the wealthier you will be with the same amount of money.  To put some simple numbers in, if you earn 12% per year in interest on 100 grand in the bank, you’ll have 12k a year, or 1k per month to live.  Could you live off 1k a month?  How long would it take you to save 100k?

Right now my wealth is about 2 years.  Living frugally at my parents house (and stealing their food) while paying the minimum on my student loans.  Not bad for being unemployed with 30k in student loans.

How wealthy are you?


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