A lot of Money: What does it really mean?
This is an intriguing question because it is divided into two different sections. Which include the income or salary and net worth, which we will examine differently. To begin, we should define exactly what a lot is. To me, it indicates a sum that is much greater than the limit of money buildup. In which you and your peers are too familiar with. Thus, if everyone in your social group earns between $5 and $10 an hour. Perhaps, someone earning $50,000 a year has a lot of money. But to that person, $50,000 a year does not seem like a lot.
What Is a Lot Of Money?
Based On Income (Salary):
In my own experience, most of my colleagues earn nearly the same as I do, within a reasonable margin. As a result, I believe a wage range around my own income to be fair. However, because I was raised in a quite poor environment, I believe much lower salaries to be average.
At a point around 50% greater than what I earn, things start to shift. Meanwhile, that point begins to appear a lot of money to me. For instance, if I earn $50,000 per year, someone earning $75,000 per year appears to me to have a lot of money than me.
Over time, one’s view tends to evolve
For instance, I grew up pretty impoverished, and while I was in college, incomes in the $20,000 level felt acceptable. Whereas $30,000 felt excessive, like a lot of money. My college roommate’s parents earned a combined salary of more than $150,000. And I expressed to him that I felt his family is wealthy. He really smiled when he heard this remark.
However, as I established my own employment, my first job out of college paid me $50,000 per year. For the first year or two, this felt like an amazing sum of cash. However, as time passed, it became more usual. What appeared to be a hug pay became usual, and my concept of a large pay shifted higher.
At the moment, a few of my side ventures are buzzing ahead. And I feel as though I am on the point of earning what I consider to be a lot of money. I haven’t noticed a shift in my feeling of normality yet. Because I assure myself that this is a sudden spike in income.
In a nutshell, our definition of a lot of money based on salary is mostly determined by the present experience. As well small role played by the previous experience.
What Is a Lot Of Money Based On Net Worth?
On the other hand, net worth appears to have a strong correlation with age. As people grow older, I expect them to have a higher net worth than younger folks.
For instance, when I consider someone of my age, I do not consider having a negative net worth to be odd, and having a net worth greater than, say, $50,000 to be a lot of money. However, if I look at others who have had similar lives as mine and are, perhaps, twenty-five years older, I consider it normal for them to have several hundred thousand dollars in net worth – I don’t recoil at that amount of money if I know they’ve had time to grow it.
As a result, my concept of “a lot” of money based on net worth has a complex link with salary and age.
What Impact Does This Topic Have?
For many people, their concept of determining “a lot” of money is intrinsically connected to their sense of self-worth. They make comparisons to those who have “a lot” and experience an odd combination of emotions.
I consistently observe that those who view “a lot” of money as motivating tend to have sound personal financial habits, whereas those who view “a lot” of money as depressing are likely to have many debt problems. Thus, one significant step in a healthy path is to consider small actions you can take whenever you consider “a lot” of money. Could you eliminate a big payment from your life? Could you cut back on your shopping? How about resolving your credit card debt?
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Additionally, one person’s concept of “a lot” of money may differ from another’s. My parents regard my salary as a lot of money, although I do not. Likewise, there are readers of this blog who earn what I believe to be a lot of money but do not and struggle to make ends meet.
The truth is that everything is relative, but you may apply perspectives to help you set some reasonable goals for yourself. Due to this relationship between perspective and goals, I like to present my monthly financial updates in percentage terms rather than raw dollar amounts. Whatever your position, trying to improve your net worth by 4% over the course of a month is an extremely satisfying task and goal.
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What people consider to be a lot of money usually seems normal when they step up their game in life. Therefore, the higher you go, the more your mind is open to understanding more the concept of a lot of money.
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