[Pequod]

I would consider myself materially rich if I could maintain my current lifestyle without having to work for the rest of my life, and having the time and surplus resources to travel a bit. Mostly road trips, I would think

Considering present interest rates and inflation, I would say liquid assets of 6-7 Crores would make me happy.

PS - “philosophy” of rich is an entirely different discussion.

[itisravi]

You know what they say: If you have to tell people that you're rich, then you aren't.
This is not a threshold numbers game at all. ¯\_(ツ)_/¯

[GhostGrid]

Like there is no limit to gaining knowledge, similarly, there is no limit to humans desires for earning money. Very few people believe that happiness is more important than money, but they are very few and hard to find.*

These points might be illogical for some or won't add any value, but in order to get to the point, I had to mention them.

Threshold (my personal experience "Bengaluru Days"):

1) Job seeker: "I always tried my best to spend as little as I could, as for me it was very difficult to take money from my parents."

2) First job: All I wanted was a good flat for rent in a good location, along with a few trips to the pub.

3) Second job: 15-20 trips to pubs; also bought an iPhone and VW Polo (Trendline - MPI).

> got married

4) Third job: Along with the job change, I opened a restaurant in partnership with my uncle.

> bought a 2-year-old used Civic and lived a lavish life for one year.

> After 1.5 years, we sold the restaurant because it was at a huge loss.

> Resigned (couldn't handle the pressure in the office as I was already depressed with the loss)

5) Fourth job: Joined after 1 year of gap (startup), started with a lower salary. Now my only requirement was to live in a gated community without any wish list, and unfortunately, my wife had to suffer with me.

> lost my job again when the company was shut down because of COVID-19.

6) Fifth job: started after a 1.5-year gap, again with a lower salary. But this time, me and my wifey decided to create a wish list, but with lots of boundaries.

So at this point, "assets over Rs 1 crore" would be totally fine for me.

But if you ask me the same question around Point (4), my answer would be "assets of 100 crore and beyond" because I was living in a different world with unrealistic targets.

At this stage of life, liability and situation determine the threshold for me. Now I know what wonders I can do with 1 crore, but five to six years ago, even 50 would have been less for me.

PS: At no point was I trying to brag.

[Emvi]

This is a thought provoking thread, no doubt. We all live in a fast-paced world. While yesterday's "wants" have become today's "needs", today's "wants" soon become tomorrow's "needs". Given this, as already opined, richness is a subjective term IMO. However, I would be more interested to know the threshold for considering an individual or a family poor. Government prescribed 'Below Poverty Line' touchstone is best not considered.

[V.Narayan]

Some interesting answers dwelling on the philosophical side. As member @Lobogris has sought a hard number answer then my opinion would be as follows:

What would it take to be considered rich by other rich people and not just by our younger more aspiring self's!

- Liquid assets of Rs 20 crores free of liabilities
- One house in our name free of EMIs, presumably the one we live in
- An income a year free of tax of Rs 1 crore.

Most A grade wealth managers, I mean the focused ones, not the wealth teams of main line banks, count you as a full customer after your assets in their care cross Rs 20 to Rs 25 crores. So, the professional firms who manage wealth for HNIs count you in once your assets under their management reach that threshold. That gets us to the bottom of the pile of the truly wealthy.

Another way to view this is through the lens of the tax collector. If your income is over 5 crores a year you get taxed at 42.7% not at a marginal rate but on the whole darn income from zero upwards! So that's the threshold of the dreaded taxman. The number of income tax payees with a declared income over Rs 1 crore in year ended March 2021 was 131,390. 2.6X higher than March 2017! But a long way to go still.

Reminds me of the old MasterCard advertisement - Happiness, Time, Health is priceless. For everything else there is Master Card!

[wildsdi5530]

Originally Posted by SoumenD

Am currently scouting for a 3bhk around South Bangalore and with popular builders(Prestige, Brigade etc) I notice 1.5-1.6cr range for 3BHKs. And mid level car for 1cr? Where do we hold Octavias and all now?

South Bengaluru - Jayanagar, Koramangala? Wow that's a great price. Here in Hebbal, Ring road, the prices are at 4-5 Cr. Small 3 BHK < 2000Sqft are available cheaper though. Pent houses are at 12 Cr. Have even seen 20 Cr.

You can go to the outskirts and get 3BHK at 1.5-1.6 Cr easily. Near Devanahalli you can get huge plots for ~2Cr. In Tumkur/ Kunigal land sells at ~20L per Gunta (8Cr per acre).

And sorry I meant Mid-level Luxury car aka E-class/ 5 series/ A6 level. Truly rich in a Skoda??

[dhanushs]

I think richness always depends on your peers.

If you choose lower income peers, you are rich, the other way around makes you poor. It's upto you how to view and live your life.

That said, co-habiting with higher income and lower income peers has its own advantages and disadvantages.

[SoumenD]

Originally Posted by wildsdi5530

South Bengaluru - Jayanagar, Koramangala? Wow that's a great price. Here in Hebbal, Ring road, the prices are at 4-5 Cr. Small 3 BHK < 2000Sqft are available cheaper though. Pent houses are at 12 Cr. Have even seen 20 Cr.

I guess this kinda proves why ‘Rich’ is a relative word. For mortals like me 1600-1700 3bhks in city like bangalore are big enough. 2000+ are HUGE but for you they(1600-1700 3bhks) are small. In short our perspectives are different. Not saying either one of us is wrong, it’s just relative to our current situations IMO.

Originally Posted by wildsdi5530

And sorry I meant Mid-level Luxury car aka E-class/ 5 series/ A6 level. Truly rich in a Skoda??

Never said truly rich in a skoda but again won’t count them as low level or entry level either. We are in India after all

[Hayek]

For me, rich has always been with an income 5x of what I earn, and / or a net worth 10x of mine.

Early on in my career, my goal was to earn enough to retire - and I thought ₹ 1 cr plus a 3 BHK flat in the distant Bombay suburbs may have been good enough. Back then, a Honda City was an aspirational car - what Directors of listed companies felt proud driving.

That translates to about ₹3.5 cr (adjusting from inflation since FY01) or ₹ 12.5 cr (adjusting based on nominal GDP in INR).

Do I still think ₹12.5 cr is rich? No, I don’t - but that is perhaps I have been fortunate enough to have been able to move from aspiring for a Honda City to comfortably buying a BMW X3.

But by almost any absolute measure, USD 1.5 mm is a lot of money. Even in the USA, a net worth of USD 1.5 mm (₹12.5 cr) excluding one’s primary home would get one to the 93rd percentile of the population - which is probably beyond most people’s definition of middle class.

But it takes a net worth of USD 10 mm to get into the Top 1% in the USA - viz ₹ 83 cr. And a net worth of USD 30 mm for the UNHI groups of the big private banks to consider you a worthwhile customer - which would also get you into the Top 0.5% of the US population. Yup at ₹ 250 cr, even Credit Suisse would think you are rich.

[MT_Hyderabad]

A family where you and your dependants are free from any critical health condition can be termed as rich.

From monetory point of view, if you created 5 cr assets all by yourself already and are capable to create similar assets in the near future(next 5, 6 years), you can call yourself rich.

To add one more thought: What you see as rich may not be rich. A person may be under heavy debt and living a lavish life.

I was walking with a very senior guy on the streets of Basel and I asked him a question, that there are so many Merc and BMW here whereas I don't see many in our company, it's by choice or our company pays less in comparison to others?

He said, what you see are mostly cars on lease which get these kids in trouble later on.

[GutsyGibbon]

Couple points about people who have tied up their net worth in their homes, a lot of people with homes on plots created pre independence can be classified as super rich. But, some people never allow themselves to enjoy the fruits of this appreciation. They sit on this asset, without monetizing it, and live extremely frugal lives. Case in point my wife's extended family. They have houses in old Bengaluru, that they never cash out. In fact they brainwash their kids to hang on to this old shack, and live like a destitute. I recently witnessed a couple of them die, never having experienced their wealth. Often, I see the kids who are hit with this windfall of wealth, unable to handle it and make smart choices. People who choose to go the legal route to dispute each other, and delay the arrival of this wealth are even worse. They need to open their eyes and see the time value of money. Personally - 10cr before my 40th birthday is better than a 1000cr on my 60th birthday. Not sure if its ego, culture, or what not, people push a settlement way too far.

I not common to see this in the western culture. People take out home equity loans, or reverse finance, or simply move out, and enjoy a good life - today. Richness needs to translate into happiness, not suffering and heartburn.

[Axe77]

I can think of a few ways to define this, each of these highly personal and subjective of course. For a middle aged or slightly older than middle aged person:-

From a contentment approach perspective:

1. if you have money to meet any obvious future liabilities (e.g children’s education, funds for extraordinary medical expenses etc) and have enough savings to sustain yourself on your existing lifestyle without having to work any longer - you’re rich.

From a numbers perspective:

2. in asset + income terms, if you have a house that’s mortgage free + 20-25 crore of diversified investments including liquid investments, and a steady, dependable annual gross income of at least 2 - 2.5 crore, you’re rich.

3. In pure asset terms, if you’ve got a house that’s mortgage free + 45 - 50 crore of diversified investments, including income generating liquid investments, you’re rich.

The above to my mind is basic, comfortably off rich. To be properly, care a damn, “filthy” rich, I’d reckon we’re talking net worth of 100 crore and upwards.

[vivek95]

Agree with the poll results so far, my vote goes for the same i.e Assets worth 20 crore and above. Let philosophy be kept aside, I would like to answer your question in a very simple way, understanding your genuine curiosity in this topic. I consider anyone who earns Rs. 10 lakh/month OR has assets over 20 crore in India is "rich" ( holds true even for an expensive city like Mumbai in my definition ).

[kiku007]

Originally Posted by V.Narayan

Most A grade wealth managers, I mean the focused ones, not the wealth teams of main line banks, count you as a full customer after your assets in their care cross Rs 20 to Rs 25 crores. So, the professional firms who manage wealth for HNIs count you in once your assets under their management reach that threshold. That gets us to the bottom of the pile of the truly wealthy.

Another way to view this is through the lens of the tax collector. If your income is over 5 crores a year you get taxed at 42.7% not at a marginal rate but on the whole darn income from zero upwards! So that's the threshold of the dreaded taxman.

This is the simple and straightforward objective answer to OP's question.

Try to book an appointment with some of the Grade-A Wealth Managers/Estate Planners and they'll give you a reality check on how rich you are (or not) based on their criteria. I don't know about India but the good ones may need a recommendation to even get an appointment.

[V.Narayan]

As member@GutsyGibbon has alluded to, the house we live in, assuming we own it, should not count as a part of our wealth. It is a locked asset and its value is at best a good ego massage and simply a number.

At the expense of going off track, for most of us not born with ancestral wealth or the proverbial silver spoon - no matter what our income, spend less than what we can comfortably afford to so that we have a reserve for later age when inevitably our relative earning capacity declines. That ensures we can maintain a stable standard of consumption at 80 that we enjoyed at 55 when we were at the peak of our working & earning prowess. Too many of us when younger assume that after 60 or 65 we will suddenly start living a more frugal existence. We might be forced to, but it is not the natural order of things. Lifelong habits of what we consider a comfortable standard stay with us in later age and in fact become more critical to our self worth as other symbols of status {titles, positions} fall away - ask me :-)

I can't speak of the UNHIs but too many first generation HNIs in the joy of having got there jump onto the farmhouse-summer home-flat in London bandwagon. By the time they get to that point they are in their 50s. A decade later in their 60s or worse 70s managing these super luxury assets becomes a real physical challenge even assuming good health which is not in everyone's kismet. And to become truly wealthy we could consider sharing some of our wealth with the needy.:-)

Originally Posted by GutsyGibbon

Couple points about people who have tied up their net worth in their homes, a lot of people with homes on plots created pre independence ...