Presumably there’s no bank account with x-million or billion $ in it. How is that fortune stored? E.g. if Forbes declares a celebrity is worth $100million how does Forbes know that? And how does that celebrity’s finances work? I know some will be tied up in property, investments, companies, etc. What about disposable income?
In: Economics
explained: billionaires, & explained: the stock market on Netflix are good intro videos for this topic
First of all, for most people, Forbes doesn’t know, they just sorta guess based on information they have available. They may be right or wrong, they don’t give a shit, they’re just trying to get clicks.
For many very wealthy people, generally for businessman (like A Bill Gates), they may have public records of a lot of their stock holdings plus purchases of real estate. This information is public and available, although it certainly doesn’t show the whole picture and the rest is guessing. Athletes or movie stars, there may be records or reporting on their contracts and pay. But again, these are usually very very rough guesses and there’s no penalty for being wrong.
Most people’s money will usually be in various investments in the stock market and often their home(s). Hell you don’t even need to be “rich” for that. Middle class people even will have most of their net worth in the stock market and in their homes.
Disposable income is simply not an issue, they have plenty of money to have available for day to day expenses in general accounts
For the second question, usually rich people tie up the bulk of their money in investments, mutual funds, real estates, and only a small fraction is kept as cash in a bank. Reason being, rich people know it’s always better to make your money “work” for you instead of wasting away in a bank. As for disposable income, it depends but a couple of common sources:
* if they are still working, they just live off their base salary and save/invest the rest
* they live off the quarterly dividends from stocks and mutual funds. Or live off the interest from savings or bonds.
* they live off rental income from investment real estate properties.
* trust fund disbursements
* some combination of all of the above
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