People tend to think they are less relatively wealthy than they are. You can check out your perceptions against reality for a number of countries here. I'm not surprised. According to the official statistics we are in the top 4% of households in Australia by wealth. But looking around, it certainly doesn't feel like that could be true.
Our house is only valued a few percent above the median for our city. Our car is a 15 year old Ford when it feels like the roads are full of luxury vehicles. But it's not like we are saving like crazy. In 2018, we spent almost all of what we earned from salaries. Apparently, a lot of people feel the same way.
3 comments:
Hello, mOOm
I do as well. I think this is a very human behavior. You would like to focus on a positive competition, disregarding a lot of people who are poorer than you. One way to avoid it is by buying house in a cheaper neighborhood.
I also think that you are not a typical 4%, ration between debt and savings are certainly in your favor. Big earners are spending big as well. 2018 was an exception for you.
Indeed I do as well. However in your case the reason why you feel relatively less wealthy is that you spending less money and saving more.
You could probably afford a better neighbourhood, a flash card, overseas vacation a couple of time a year and so on. You do not do it and this is a conscious choice.
Another reason is we tend to focus on positives. You would like to live better, not poorer so ignoring all suffering and deprivation around you.
Hello mOOm, this is because you aren't spending the inheritance. Your wealth is invested and hence invisible.
If you look at your ratio house value /invested money, yours will be comparatively small. If you driving 15 year old Ford, you probable don't own a Rolex or Omega watch nor been to Bora Bora.
However. you wealth is in the piece of mind. You aren't afraid to lose your job or your house. You have plenty of money to bu new one and leave for the rest of your life without a job. This worth it, for a lot of people, chief.
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