With the recent movement on the Bitcoin price that pushed it above 50K (briefly for now), a couple group chats started getting messages, after being largely dormant for a little while. It is interesting that while some people don't talk about their interests that much in crypto, as soon as there is upward price movement, they are back into engaged mode and ready to once again acknowledge their dreams of crypto wealthiness.

What is wealthy?

Have you considered this for your location and preferences?

I am not wealthy. Nor am I rich, well-off, or upper-middle income. I am not even middle-middle income. I guess, I would be somewhere around the lower-middle range, though my wife and I have managed to get a house together, because we made a couple of decent moves with previous apartments, so we had enough for the deposit. It also helped a lot that we bought a "fixer-upper" instead of something that was "ready", and have been renovating it for the last four years.

It is a bit strange though in some ways, as "having a house" seems to indicate to people I know here that we must be well-off. Most of this is because they do it through comparison, where because they aren't in a house, that we must be in a better situation than them. Yet, this is likely not the case, as most likely, they earn more than my wife and I.

However, there are a couple things that will differ amongst people and their usage of money that matter in this regard. One is the obvious way that money is used, where there are people who spend far more than they "need" to on things like cars, holidays, and eating out. This cuts into their ability to save, as well as their sense that they can service a house mortgage, even though it is likely not much more than the rent that they are paying, or a mortgage on an apartment. For instance, one of my friends bought a 40m² old apartment (430ft²) in Helsinki, for the same price we bought our 200m² (2150ft²) house, on a 1100m² block in a smaller city.

It is a lifestyle choice.

The other aspect to the way money is used, is also through risk, where some people are willing to invest, but they aren't necessarily willing to put it into a house. This is probably what is the case for a number of my friends, which means that while they live in an apartment, they have a high rate of invested wealth in stocks and the like, including some in crypto.

Nothing wrong with this approach.

For many, it makes a lot more sense to do it this way, especially if they aren't settled with their job, or the city in which they live. It gives freedom and reduces the hurdle to move if needed, as wealth moves with, unlike a house. Yet, there is still this interesting phenomena where people in this situation, seem to think that people who have a house are doing the same, plus having a house.

Some are.

How many? I don't really know, but if we are looking at the impact of wealth, the wealthy are those who are able to have more financial options that they can take simultaneously. I am not talking about the ultra-rich where there are no limits, but wealthy enough that a person can own a house, have a nice car, travel, spend liberally on consumer goods, and still be able to put the majority of their income into generative investments.

The rich get richer.

Because it is very hard for them not to, just by human nature. Once there is a significant level of wealth available, the constraints of low-level spending come off, but the high level spending is still in place. The richer one becomes, the harder it is to live hand to mouth, because the mouth just can't take that level of spending. So, there is always wealth left on the plate, and that get cycled into more investments.

An interesting observation of this situation is where people seem to make an assumption that to be wealthy, bad things have to be done, or people have to be very frugal. But, at the same time, if a person loses their wealth or "wastes" their wealth through constant spending, the general opinion is that the person was an idiot with their money. There are plenty of lottery winners (and inheritance kids) who fall into that category, because they probably haven't developed the financial habits and hygiene that someone who has "earned" their money has over the space of years.

A friend of mine was earning twice as much as I am now, seventeen years ago, and had nothing to show for it. He was living hand to mouth to the point that he would run out of money a few days before payday, and have to borrow from friends. I found this insane, especially since at the time, I was earning about a third of what I am earning now, and was struggling to make ends meet.

Frivolous.

Was he wealthy? Not at all. But, he had the potential to be, but his behaviors meant that he wasn't able to turn it into something tangible. Instead, it was just financial potential wasted, and the worst part was, he wasn't even happy in his life. He wasn't using the "privileged" amount of money he was getting, to improve his, or anyone else's lives at all-. Well - I guess the places he spent copious amounts of money on drinks benefited.

Wealth is a funny concept, because while many people say things like "health is wealth" and "money can't buy love", money itself is just a tool that can be applied to affect the conditions. Being poor doesn't create the environment for health or love any different than being rich does. But, money can change the effective environment, where there are opportunities to meet people, work with people, buy better quality food, experience, atmosphere and a whole range of other influential factors. It doesn't guarantee outcomes, but used well, it can increase the likelihood of improving wellbeing. Money can't buy love, but it can help create spaces where love is under less pressure due to the daily grind.

What is considered wealthy in your region?

What would that look like in your opinion and, would you want to be wealthy? What does it require, what are the behaviors needed, the job needed, the income level needed to effectively build the runway to wealth? What tools do you have available, networks, skills? What are you willing to do?

Maybe, it isn't important to you at all, and that is a fine approach as well. But, if what we are doing isn't aligned with what we want from this life, we are likely going to find it increasingly difficult to meet the basic needs that money can't buy.

How high does it need to go?

Taraz
[ Gen1: Hive ]