How to become the 1%

It's not that I want to be ridiculously wealthy, it's just that I like their toys. If those big wealthy kids would just let me play with them every now and again I'd be happy. But of course, like all selfish kids they don't let anyone else near them. They have the new philanthropist mentality - "I want to help everyone who is less fortunate than myself - but I'd rather not have to socialise with them."

I'm not bashing the new wave of billionaire who are giving like none of the 1% have ever given before... I'm just saying, a billionaire giving 10% of their yearly income is an enormous gesture - but is it equal to a person on 40,000 who donates $4,000? I would argue it's less impressive because it's easier to live on 9 million, down from 10 million a year, than it is to live on 36,000 down from 40.

But I digress - the question is how do you and I get into that tax bracket where we can squabble about whether or not our deductible contribution is more likely to change the world than our lifestyle.

You can read all the books, make all the bold investment choices and pay thousands of dollars for advice and for 99 out of a hundred people I guarantee nothing will change. You need to invent, create and then patent a unique and needed idea or thing. You need to pick the one stock in one thousand that goes from a penny dreadful to a dollar+ stock, you need to win the lottery and then invest wisely growing that base by over 10% per year.

In ten thousand people, expect 4 millionaires and about 0.005% billionaires.

But there is a way to guarantee your family will one day make it and it involves time. If one person per generation, or two for every ten were to donate their entire wealth when they pass away to a trust fund that gained a high interest rate above inflation, an interest income that compounded and everyone also made regular minimal contributions, as little as 2% of income per month made by every working family member, over time, your family would be sitting on its own fortune. At that time a more profitable investment could be looked at and entered - remembering of course, each critical decision along the way could bring your generations of hard work undone. But - instead of it being a 4 in ten thousand chance of getting rich, the chance of investing with Bernie Maddoff or buying a profitable company that quickly sucks your money dry and goes belly up would be almost the reverse percentile chance - maybe 4% risk.

Place strict controls on the fund, allowing future generations to get a start from the money pool and you've made it into the ranks of the elite within a hundred years.

A HUNDRED YEARS! Why didn't you tell me it would be a hundred years at the start and I could have skipped this idiot article?

A hundred years seems like an awfully long time when you're a teenager, it's a long time when you're in your twenties, a good slab of time once you hit forty and not nearly as daunting when you celebrate a grandparent, or great grandparent's hundredth birthday and that person was someone you knew or have known for years.

That's when you realise one hundred years isn't a ridiculous time to wait for your family - the children of your children and their children to be living without economic fear because your legacy was one that recognised that simple fact.

And it's not like there aren't immediate benefits along the way. My Will stipulates an amount equal to the cheapest four door sedan on the market to be withdrawn from the fund when any child of our family's direct line turns 18. A further 10% of the fund to go to that child at age 30 to be spent on the down payment of a property. That's all they get.

Now, as with Bernie Maddoff's investment strategy, someone along the line could end up living in the 'City Edge' trailer park and having 16 kids in an effort to get rich off their own reality show, only to discover all their neighbours also have 16 or more kids. And those kids at 10% each would wipe the fund clean. C'est la Vie.

My Nephew Charlie isn't worried!

Ideally, with the ethos of this fund adopted, protected, contributed to and respected rather than rorted over time, it should not just grow but exponentially flourish. By the time you are a great grandparent you can reasonably expect more than 3 of your line coming into this world. By the time a great grandparent, close to ten based on an average 2-3 child union.

Remembering that the fund should become a family legacy, something the entire family controls and contributes to - if it's respected, the more who draw from it, the more who should contribute to it and so on.

You can put in whatever other safeguards you want, for instance, the board of the trust fund can be those reaching 40 years of age to give the direction of the fund some mature heads to guide it. You could also put in decisions for old age, although most make allowances for this in their own lives in our family. But this fund is yours to dictate to at the outset and its done so your legacy to your family will be more than a vague memory of you for a few older members and a few pictures that get looked at 3 or 4 times a year, maybe even hung on a wall in the hall to the upstairs toilet. Whatever the case, this is a family trust fund that can allow you to make a positive contribution to the future generations and let them know that even from the distant past, you knew you had a responsibility to them and for them and you did what you could to fulfil those obligations.

Wave if you know your uncle's got your future covered.

Also - general rule that covers everything...

You're never too young to appreciate sports!