Jul 262014
 

If you ever want to feel rich just head over to globalrichlist.com to find out where you are on the spectrum of wealth. For example when I punched in my income I found out that I am in the top 1% of all earners in the world :) My income is so high I can afford to pay the annual salaries of 10 doctors in Azerbaijan, a small country between Eastern Europe and Western Asia. All you need is to earn more than $32,000 USD to be in the top 1% as well.

In terms of wealth I input $300,000 CAD as my total net worth and it turns out I’m in the top 5% :D

14-07-wealthcomparison

To be in the top 1% you’ll need a net worth of $830,000 CAD or $770,000 USD. But for now I am already very pleased being at 4.61%. If I take just 1% of my current wealth I could feed a family of 4 in Ethiopia for 3 years :shock:  My personal wealth is equal to the combined wealth of 231 people in Afghanistan. What a financially empowering realization!

I think the moral we can take away from this relative wealth exercise is don’t work in Azerbaijan if you’re a doctor.

It’s possible to feel financially inferior after getting used to living in a first world country. Sometimes it’s nice to be reminded that making even just $30,000 a year and having a $50,000 net worth would already put someone in a very favorable financial position.

Other than using that website to compare our wealth with others for fun, we can also use it as a motivational tool. Find out how rich you are today in terms of both income and wealth. Write down your results, or take a screenshot and email it to yourself. Then go back to the site next year to input your new income and net worth to find out how your position has changed. You should be moving up the ranks every year. If not, find out what’s preventing you from getting ahead. In a global competitive world if we don’t improve, but others do, then we will get left behind. For my own goal, by this time next year I hope to be in the top 4% of the richest people in the world by wealth :)

  ————————————————————————
Random Useless Fact:

If plastic is made from oil, and oil is made from the hydrocarbons of decomposed, prehistoric plants and animals, then that means plastic toy dinosaurs are partly made from real dinosaurs.

14-07-dinosaur-resource

Jul 142014
 

Somewhere in the world right now there’s a person who is working 10 hours a day doing manual labour and making minimum wage. He realizes his life could be much better so he saves what he can to build the future that he wants. He believes that he can change his circumstances in life by working hard, and having a solid plan. He tries to start his own business but fails. But he tries again and again, sacrificing his time, savings, and energy to make it work. Eventually his company turns a small profit, which grows every year, and ten years later he is a millionaire :)

Meanwhile just down the street from the first person lives another man who just won the lottery and becomes a millionaire over night. He doesn’t think about how to use the money wisely. He just knows he’s rich now and believes he will stay rich forever, without considering that his circumstances might change over time. He starts to buy fancy cars, make friends with other people who also like to spend lots of money. He eats out almost every meal and becomes fat and lazy. He continues to buy lottery tickets hoping he would win again, but he doesn’t. Ten years later he realizes he has spent all of his money and is now broke :(

14-07-lotteryfail

Which type of person are you? By making it on your own you can appreciate the ups of success because you’ve experienced the downs of failure. It can be tempting to immerse yourself in the bliss of good fortune, but enjoy it responsibly to make that feeling last :) Circumstances in life can always change; people who don’t think their finances in the future can get better or get worse are not being honest with themselves. It’s important to understand where your life currently stands, where you want it to go, and how you’re going to make that happen. If the current circumstances around you suck, then find a way to change them :D

  ————————————————————————
Random Useless Fact:
Somebody made a ridiculous bet on the Germany vs Brazil World Cup game. Either that person can predict the future, or is just extremely lucky.

14-07-worldcupbet

Jul 112014
 

Meet the 5 wealthiest peoples in Canada, their net worths, and their source of wealth.

1) Thomson family. $26.1 billion. +30% from previous year. Thomson Reuters, Globe and Mail.
2) Galen Weston. $10.4 billion. +24% from previous year. Loblaw Cos. Ltd., Holt Renfrew
3) Irving family. $7.9 billion. -3% from previous year. Irving Oil ltd., J. D. Irving Ltd.
4) Rogers family. $7.6 billion. +18% from previous year. Rogers Communications Inc.
5) James Pattison. $7.4 billion. +20% from previous year. Jim Pattison group.

Except for the Irving family, it’s surprising that they’re still able to grow their net worths so much, percentage wise, despite how wealthy they already are. Thanks to these rich people small investors like us can just piggy back off their hard work and success. For example anyone who had invested in Galen Weston’s company, Loblaw Companies Ltd (L), at the beginning of this year would be up 12% on their investment so far.

14-07-richgraph

src: canadianbusiness.com

If we look at the industry these top elites work in it’s mostly information services, food, energy, telecommunication, and advertising. I think we should include these types of businesses in our own portfolios. For example late last year I blogged about buying Comcast, which is a big cable company but also has media properties that provide information and news. I thought Comcast has more potential than Reuters. So far this year Thomson Reuters stocks is down 2%, but Comcast shares are up 4% :D #lucky

There are many ways to invest in the food business as well like buying fertile land or stocks of seed producers. These are things everyone should do because if the price of food increase in the future at least our wealth will rise with it. Investing in oil and gas is a good bet long term and thankfully most Canadians are already well exposed to that :) The three big telecom businesses in Canada are highly profitable due to their oligopoly. If we hold Roger’s shares (RCI.B.) then we’ll earn 4.3% dividend each year regardless of the stock’s performance. That’s better than a high interest savings account or government bonds right now. And if the Rogers family continues to grow their company and become even wealthier, then so will we :D Personally I have stakes in all three major telecom incumbents because an oligopoly has unfair competitive advantages that companies in other industries don’t.

Most of us will never become billionaire entrepreneurial giants. But at least we can stand on their shoulders and go along for the ride. This is the easiest way to make money. If we side ourselves with the same interests as the ultra rich, then it only makes sense that we will eventually become rich too. The universe has a mysterious way of giving us what we associate ourselves with :D Investing with the rich won’t make us billionaires, but millionaire status is more than probable, which is good enough for me ;)

  ————————————————————————
Random Useless Fact:
The diversity of Fox News anchors.

14-07-foxnewsanchors

Jun 052014
 

Want to invest in China? The Shanghai stock market index (SSE) has returned an embarrassing -22% in the last 5 years. A buy and hold strategy would have lost money. Doh! The Chinese stock market is too mainstream anyway. So I’ve developed a better strategy to invest in the world’s second largest economy. My plan is a bit risky, and you’ve probably never heard of it before, but so far it’s proving to be very effective. If anyone else had held the same investments as me, their net worth would have also increased by more than $100,000 over the last 12 months :D See my fiscal updates category for details.

To successfully invest in China we have to think like hipsters, and buy stuff before it becomes cool ;) So here is my strategy. Invest directly in China’s economy by purchasing financial assets OUTSIDE of China that the wealthy Chinese are also buying. Let’s study what the rich in China are investing in so we can predict with relative certainty how the next cohort of new Chinese millionaires will use their money as well. Then we just need to invest before they do.

So what are Chinese millionaires buying?

Generally speaking Chinese investors love real estate. An investment bank recently reported that the richest 1% in China owns about one third of all residential properties in the country. Holy hamburgers! Such property hogs 8-O They are so enamored with housing that it’s no surprise Chinese investors are looking elsewhere in the world to satisfy their real estate addiction :? The top three countries that are attracting Chinese investors are the U.S., Australia, and Canada.

14-06-chinese-realestate-foreign-countries Chinese foreign investors invest in china

Real estate agents do not have to disclose their client’s information to any global anti-money laundering organization. So foreign Chinese buyers can land with suitcases full of cash and get real estate deals done clean and fast.

China’s outbound real estate investment jumped by 25% in the first quarter of this year. Great Scott! The top cities to attract Chinese money so far in 2014 have been Chicago ($464 million), London ($348 million), Sydney ($243 million), Melbourne ($150 million), Los Angeles ($144 million) and San Francisco ($72 million), according to real estate firm Jones Lang LaSalle. Chinese buyers spent $30 Billion on overseas real estate in 2012. About $9 Billion of that went to the U.S. and a lot of that was in California.
.

Continue reading »

Mar 302014
 

Remember in Marvel’s The Avengers movie when Tony Stark (Iron Man) bragged about being a “genius, billionaire, playboy, philanthropist.“? Well I think Bill Gates is like the real life version of that :)

14-03-pickupline bill gates

How many times have we heard negative connotations towards money like the following phrases? Money is the root of all evil, money corrupts, money can’t buy happiness, etc. Interesting how it’s usually the poor who says these things. Which is most likely why they’ll stay that way because if they associate money with negativity, there’s less incentive to go after it :?

But just because someone is rich, doesn’t mean he or she is greedy or vain. According to the latest numbers by Forbes, Mr. William H. Gates III is the richest person in the world today with a net worth of $77 billion as of March 2014.

But what’s even more impressive is how he has already donated over $30 billion over his life time so far. This means that if he had kept all his money from the beginning, he would have a net worth of over $100 billion dollars today! Which would probably be the first time in history for anyone to break the 12 figure net worth barrier.

Continue reading »