The top 1% is only 1.2 million USD net worth, top 0.5% is 1.8 million USD.
So basically for a team of 2-3 tech founders raising a series A round is the entry ticket to becoming part of the 1% (on paper at least).
So basically for a team of 2-3 tech founders raising a series A round is the entry ticket to becoming part of the 1% (on paper at least).
$6,000 is a lot of money, but it's not that much money. An iPhone, for example, costs approximately $2000-3000 by the time it is all said and done and I see a lot of them out on the street in the hands of normal Americans.
With enough time, $1.2M can be made with a regular job. Nobody said you had to be in the 1% of net worth holders by the time you turn 25, or it doesn't count.
I admit, I come with a biased perspective. Everyone I know born in the 40s were farmers. They all pretty much lived a life of poverty, putting all their income into appreciating assets. They're now all sitting on multi-million dollar fortunes.
Assuming you are in the mid-to-high end earning range of the 99%ers, if you want to live a life of poverty, there's a good chance you'll make the 1% list someday too.
That's the problem with blanket statements. I would think someone who made their millions through questionable banking tricks is quite a bit different to the poor dirt farmer who sold his farm at retirement, no?
1. Time value of money. $1.2 million in 40 years will be about $2.65 million then, assuming 2% inflation.
2. 5% average savings. As far as I can tell, interest rates are no longer exceeding inflation, and haven't been for quite a long time in market-time. I would count on your interest to barely have you breaking even, all in, unless you're taking risks with the money.
Do you mean the valuation of the private company that takes place as part of the Series A round typically gives the founders some level of paper wealth that puts them in the 1%? If so, this makes sense. (Of course, it generally takes a lot of work to convert that into something that can actually be realized in a liquidity sense.)
I ask because a $50k/year pension is not unknown.
$1.67 Million @ 3% (1 / .03 * 50,000)
$1.25 Million @ 4% (1 / .04 * 50,000)
$1.00 Million @ 5% (1 / .05 * 50,000)
Put another way, if you have X Million, how much could you safely withdraw each year at 3% per year?
$1M: $30k / year
$2M: $60k / year
$3M: $90k / year
$10M: $300k / year
Keep in mind you will pay tax on these figures (15% Long Term Capital Gains tax if you're lucky, or more if it's regular income). And this does not account for inflation, so assume the value of money gets cut in half every 25-30 years.