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How much in assets until someone is considered rich in the UK? Watch

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    (Original post by James.Carnell)
    How much do you invest into each holding to spread the risk? You say you took a course (presumably university) to get to a sound level of understanding, what course would that be?

    Just curious as I have savings and an academic background in company law , but I want to increase my level of knowledge in the markets.
    MSc finance and econometrics (QMUL)

    23.5k put across 13 securities (stock, bond etc)

    Learn from Warren Buffett and Benjamin Graham and watch the markets daily.
    Tim Bennett on YouTube is good as well, so is Investopedia.
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    (Original post by jneill)
    So let's work that through. How much money would you spend without really thinking too much about it...?

    Let's say you have £1000 in you bank account, I think you'd be happy to spend £10 without thinking much about it, but £100 would cause you pause...?

    Well if a luxury car is, say £50k, then two is £100k. For that not to be a "noticeable" spend it would need to be less than 1% of their liquid assets. So that's £10 million in cash before you'd "notice". Not Net Worth... cash. To be likely to have £10 million sitting in cash I'd say you'd need £100 million in net assets. Or probably more. And rich people don't allow cash to just sit around - it's always invested in something...
    Perhaps I emphasise too much the "thinking much about it" part. I mean footballers have multiple sports cars a lot of the time but it is also widely acknowledged that many of them are terrible with their finances.
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    (Original post by jneill)
    Come back in 20 years and impress me then.
    Haha, that's a whole different game. Right now I'm just catching falling knives. You will see all those companies corrected.

    A good companies can return 40 times in 20 years.
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    I would say a portfolio of net worth £10 million excluding the value of your primary residence.
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    (Original post by rambapa)
    Haha, that's a whole different game. Right now I'm just catching falling knives. You will see all those companies corrected.

    A good companies can return 40 times in 20 years.
    A listed company investment growing 40 times cost over 20 years? x40? 4000%?

    Good luck picking that one.
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    (Original post by James.Carnell)
    Perhaps I emphasise too much the "thinking much about it" part. I mean footballers have multiple sports cars a lot of the time but it is also widely acknowledged that many of them are terrible with their finances.
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    (Original post by jneill)
    A listed company investment growing 40 times cost over 20 years? x40? 4000%?

    Good luck picking that one.

    (But I'll give you a countertip... Lowland Investment - specifically since 1994)
    yes 40 times, well the whole point of the stock market is to find those.

    Apple went from 3 dollars in 1997 to 113 dollars now, nearly a 40 times return. Amazon went from 7 dollars at the bottom of the dot com crash to 800+ dollars now, over 110 times return.

    You need to buy stocks when they are cheap, people don't realise that. I only make money cos I am buying good companies at a discount. I could have bought ABF foods back in 2014 for 3300p a share and I would have lost money now. Even though primark (ABF own primark) is a great company. The stock was too overvalued, a very high P/E and the growth wasn't there.
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    (Original post by rambapa)
    yes 40 times, well the whole point of the stock market is to find those.

    Apple went from 3 dollars in 1997 to 113 dollars now, nearly a 40 times return. Amazon went from 7 dollars at the bottom of the dot com crash to 800+ dollars now, over 110 times return.

    You need to buy stocks when they are cheap, people don't realise that. I only make money cos I am buying good companies at a discount. I could have bought ABF foods back in 2014 for 3300p a share and I would have lost money now. Even though primark (ABF own primark) is a great company. The stock was too overvalued, a very high P/E and the growth wasn't there.
    You can buy stocks when they are cheap, and find they go cheaper...

    I had Apple in 1990 and dropped it shortly after when it seemed to be on a terminal decline (and I needed the little cash i had invested at the time) - to my eternal regret... they went through terrible times before landing on the iPod and even that took a while to generate revenue. The Mac nearly killed them, and there was no hint of iPhone riches to come... (and maybe those days are now past too...).

    It's extremely difficult to predict 20+ years out which ones will make it... as you will find.

    So the solution is you have a portfolio to spread the risk and some will do well and some will go bust. But that's really just the same as a fund manager. You have a fund manger "background" so you understand this - but you are the 1% (good luck!)
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    My opinion...

    At the very minimum...

    £2 million property
    £1.5 million pension
    £250,000 liquid assets
    £150,000 salary

    If you have that, I'd define you as exceptionally financially secure (i.e very difficult to screw up and lose everything) and therefore, free / rich. Easy to increase your wealth further.

    I'd consider this for someone at their peak, say age 40 or over. If you're younger, then probably half the amount above.

    Any less than this and I feel it only takes a few shocks and all of a sudden, you're not that well off again.

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    (Original post by rambapa)
    Because I have 23.5k in the stock market and made 2k in 3 months after brexit.

    some of my holdings...

    galliford try (ftse 250)- bought at 1003p
    interserve (ftse aim) - bought at 316p
    BP (ftse 100)- bought at 361p
    paragon group of companies (ftse 250)- bought at 294p

    I have outperformed most funds. I have a background in finance either way, so I have the knowledge and experience to beat them.
    Lmao! You have a tiny holding which increased in line with the overall FTSE market gain after Brexit. Nothing much to shout about
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    (Original post by jneill)
    You can buy stocks when they are cheap, and find they go cheaper...

    I had Apple in 1990 and dropped it shortly after when it seemed to be on a terminal decline (and I needed the little cash i had invested at the time) - to my eternal regret... they went through terrible times before landing on the iPod and even that took a while to generate revenue. The Mac nearly killed them, and there was no hint of iPhone riches to come... (and maybe those days are now past too...).

    It's extremely difficult to predict 20+ years out which ones will make it... as you will find.

    So the solution is you have a portfolio to spread the risk and some will do well and some will go bust. But that's really just the same as a fund manager. You have a fund manger "background" so you understand this - but you are the 1% (good luck!)

    Wait a minute, how old are you. Apple in 1990? I was born in 1992 lol, I guess you were in the game even before I was born. Apple pre Ipod was a dead duck, no one could have predicted what was to come.

    Yes I have tried to catch many a falling knife, it's my speciality apparently. I was eyeing up H&M stock for a while, seeing as it had gone from 350p to 270p, it looked like a good corrected. The balance sheet looked strong. But it fell even more, though I recon it has stabilised now and will be back on the way up. That was probably my worst "loss". Though i'm in for the long term, I mean it will make me money.

    I only take risk when I venture into the FTSE AIM or the lower end of the FTSE 250. Most stuff in the FTSE 100 is safe for the next 20 years (though companies do go bust). We will be dead and Shell will be around. Same goes for the most of the Dow 30, you can put money in McDonalds and I can assure you, you will make back more than what you put in 20 years.

    But there is no fun in picking out defensive stocks (like National Grid, Unilever), it's a slow steady growth. No excitement. I only use defensives to balance the portfolio. Defensives do well in market chaos.
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    1 million non-main residence assets = rich imo
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    (Original post by rambapa)
    Wait a minute, how old are you.... Apple pre Ipod was a dead duck, no one could have predicted what was to come.
    I'm a parent. And yep - that's the point.
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    (Original post by Reue)
    Lmao! You have a tiny holding which increased in line with the overall FTSE market gain after Brexit. Nothing much to shout about
    Look at the stocks I quoted and their returns, those are impressive picks.

    Galliford Try returned me 35% in 3 months, not easy to replicate lol.
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    (Original post by rambapa)
    Look at the stocks I quoted and their returns, those are impressive picks.

    Galliford Try returned me 35% in 3 months, not easy to replicate lol.
    Again; nothing spectacular... assuming you're even telling the truth

    Tell you what: post us a small £10k stock pick list in here and we'll come back a year from now and value it.*
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    (Original post by James.Carnell)
    A few million? I appreciate that some people have their net financial value tied up in assets so I am not counting hard and fast liquid cash as the measure of wealth.
    For me i define somebody who is rich as somebody who can choose never to work again. Personally speaking i think £3k per month for say 50 years (so about £1.5m) is about right plus property so let's go for twice the national average and add a bit on.

    Basically around £2m is what i define as rich however at more than half a million your upper middle class outside London.

    (Original post by jneill)
    How do you know you can you pick better stocks than a professional fund manager? How many pension fund managers bought Barclays right before the crash? And did they only hold Barclays or did they spread the risk?
    To be fair that question is complex because a fund manager may not give your egg the the attention that you would. Equally it depends on your risk profile and expected return, i'd trust an experienced trader to outperform me on a short term investment much more than i would in the longer term.

    I should say that it's also a matter of control. The idea of somebody else investing my money makes me nautilus.
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    (Original post by Reue)
    Again; nothing spectacular... assuming you're even telling the truth

    Tell you what: post us a small £10k stock pick list in here and we'll come back a year from now and value it.*
    How the hell is 35% in 3 months not spectacular? This is amazing return for an investment grade company. We are not talking about penny stocks here.

    I also bought BP at 361p and it's trading 460p + now.

    Just take the stocks I listed. They will all increase.

    And why the hell would I lie, most people dont even know who these companies are. There is a lot of research gone into these picks.
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    (Original post by Rakas21)
    I should say that it's also a matter of control. The idea of somebody else investing my money makes me nautilus.
    Very fishy.
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    (Original post by rambapa)
    When you have 200K+ in the stock market, 600-700K in property, 100-200K in cash
    ^ This outside of London. In London it has to be more in property.
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    (Original post by rambapa)
    How the hell is 35% in 3 months not spectacular? This is amazing return for an investment grade company. We are not talking about penny stocks here.

    I also bought BP at 361p and it's trading 460p + now.

    Just take the stocks I listed. They will all increase.

    And why the hell would I lie, most people dont even know who these companies are. There is a lot of research gone into these picks.
    Because the overall FTSE market has risen by around 10% in that time, making a 35% not exactly spectacular and certainly not something worth shouting about in such a short time span.*
 
 
 
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