Re: What is your definition of Rich and Poor in Switzerland?
Active Income: The person who is receiving the income is literally working, either for him/herself or for a company. The income is directly related to hours worked, product produced, contracted salary obligations, etc.
Passive Income: Monies received through royalties, trust funds, annuities, stock options cashed in, ad nauseum, ad infinitum. . . .
Vous comprenez?
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Passive income is income that you don't need to spend your time generating, except possibly for the occasional health check. In other words stuff like a large trust fund or managed land holdings or a pension.
By this definition, someone with high passive income and low active income can be both rich and poor at the same time.
Yes, quite correct. Some people that have high incomes but higher living expenses could be considdered poor....such as we find in Switzerland where somebody that earns a very good global income cannot keep ahead compared to say a land owner in Sudan who has passive income and does not need to go to work every day would be considdered rich in that context.
Re: What is your definition of Rich and Poor in Switzerland?
A quote from a french humourist about being poor in Switzerland:
"How to recognize a poor chap in Switzerland? It's the guy who washes himself his Rolls-Royce"
Active Income: The person who is receiving the income is literally working, either for him/herself or for a company. The income is directly related to hours worked, product produced, contracted salary obligations, etc.
Passive Income: Monies received through royalties, trust funds, annuities, stock options cashed in, ad nauseum, ad infinitum. . . .
Vous comprenez?
But the passive income types you quote could easily turn into passive losses... the risks could be very different from having an ordinary job?
I just feel the passive/active income definition throws up some unexpected results:
Suppose Wayne Rooney puts some of his money in a pension fund, which turns out to lose money that year... He's not rich, because his passive income is less than zero?
A quote from a french humourist about being poor in Switzerland:
"How to recognize a poor chap in Switzerland? It's the guy who washes himself his Rolls-Royce"
...and that it's a Rolls-Royce, not a Bentley, tells one even more.
But the passive income types you quote could easily turn into passive losses... the risks could be very different from having an ordinary job?
I just feel the passive/active income definition throws up some unexpected results:
Suppose Wayne Rooney puts some of his money in a pension fund, which turns out to lose money that year... He's not rich, because his passive income is less than zero?
You have a better definition to offer?
Of course you are always going to get unexpected results out of any definition or system of classification. That is what happens when you create abstractions.
Suppose you got a job that did not even really cover your basic requirements and then you won the lottery. Suppose you got an excellent job with an excellent company but you got fired because you had a personallity conflict with your boss? Suppose the country that you lived in screwed up royally and sold all of thier assets at the bottom of the market leaving you with a huge national debit?
Rich and Poor are situations that change all of the time, you can make or loose money.
This is absolutely not true. Wealthy people never obsess about money. Never. It's beyond gauche.
i agree with you. money is kinda like health. when you have it, you consider it 'not important' because you've really taken it for granted.
i don't think there's a strict dividing line between passive and active income, rather a matter of degree as even passive incomes require you to do something to get it or check it even if to just make sure you're getting the right amount.
just take a look at how much time you need to spend to generate the money. for example salaried pay is highly active, requiring you to spend (say) 42.5 hours a week being at a workplace and includes commuting there, restrictions on when you work/sleep/party etc.
money in the bank earning interest is mostly passive. you just get it paid every month/year. ok, you might monitor it to see whether interest rate is competitive or whether the bank is about to collapse and take the capital along with it.
from my point of view, passive income is preferred because it is more scalable. you can have many streams of passive income because it requires little of your time. whereas, it is more difficult to hold down 3 full time jobs at the same time.
i think people struggle to answer the question because there is no point where you flip from poor to rich, but it is rather a matter of degree. also, do you distinguish between assets/net wealth or earning power? i have friends who are traders who spend pretty much everything they earn. they have a nice house and car, but that's about it. the rest is blown each and every month.
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Rich means you can afford to go to the dentist here, poor means you take a trip to Budapest.
No. I'm rich because I take a trip to Budapest for my dentistry rather than do it here.
I was in Credit Suisse the other day, and I saw this rather averagely dressed man (think IT middle management kind of suit) go up to the information desk. He had a briefcase clutched in his hands.
"I've got some money to deposit" he whispered
"Certainly sir, just go to one of the cashiers, and they'll take care of that" replies the lass.
"But it's the amount - I want to be discreet", he continued whispering.
"Oh, I see." She lowered her voice, "how much is it?".
"4 million francs", he says very very quietly.
"Ah, ok sir, I understand your concern, I'll get someone to assist you. But really, sir, there's no need to whisper...
..poverty isn't shameful in Switzerland".
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Re: What is your definition of Rich and Poor in Switzerland?
something i observed in many countries quite frequently but difficult to generalize (need to check that in switzerland):
poor people are often generous and welcoming with guests/foreigners, with a real sense of hospitality. Often rich people are greedy and stingy.
While the former has nothing to loose and is therefore open to people, the later thinks that all people are after their money and therefore tend to treat everyone with great suspicion.
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Re: What is your definition of Rich and Poor in Switzerland?
Quote:
Rich: Half of the spoilt, overpaid King Farouks on the EF who think it's impossible to live on less than 80k a year.
Poor: The miserable souls in the heart of Canton Congo whose houses look they are about to collapse, whose rusty shells of cars sit on bricks in the front yard and whose children, apparently, can't afford belts for their trousers.
It's all relative. I certainly wouldn't want to be even relatively poor here.
Those souls in the Canton of Congo are not as poor as you think
- Their houses look as being to collapse as waiting for some pro-agriculture and pro-mountain-people subsidies !
- Their cars just sit on bricks waiting for the cousin car-mechanic who on Friday evening takes the required tools and spares from the garage in Zurich, to do his work on Saturday without VAT and other outlandish notions, and then will take the tools back earliest on Monday morning
- Those children have just become too fat for their old belts, and the new one is to be bought in Zurich, when they in Congo have St. ....
like this one http://www.feiertage-schweiz.ch/st.agatha.php
and, ehmmm, compared to Mr Blocher, your ARE poor
while of course, people living on the Gold Coast (Gold-Küschte) are supposed to be rich !
Last edited by Wollishofener; 30.01.2011 at 22:12.
Just had a couple of threads where rich and poor are being spoken about and I was wonding what you all think and appropriate definition of what a rich person is Switzerland is and what a poor person in Switzerland is?
Well - you know the Rules of the Third, right?
Max one third for rent, save one third for taxes, etc, and manage wisely the remaining third (i.e. don't leverage on credit cards, car leasing, etc).
What's left in that last third is what makes you rich or poor in monetary terms.
But...
How you enjoy whatever is in that last third can be what makes you happy - which in my book is better than being simply "rich" (God know how many times I've wondered why some folks seem perennially grumpy / down / sad even when they're hanging out in the most exclusive resorts....).
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