In your interest: Paul Clitheroe
You know, this “age 60” thing is really pretty good. I am a bit surprised to find myself saying this as I have all the obvious problems of what I am told is now called the “new middle aged”. I thought I was old but I'll go with that.
Anyway, I can’t read a book, iPad or menu without glasses. This is a pain. I am fine with glasses but being relatively new to them I tend to forget them or just lose them. My solution is to buy loads of the cheap ones from a chemist or supermarket and leave them everywhere. That does help.
Next up, my hair is pretty much white, though in an attempt to be pleasant my hairdresser does claim I have “traces of bronze”. Apparently I also look “distinguished”, which I think is hilarious.
I am regularly asked if I have a Seniors Card to get discounts when I am shopping or going into a museum or whatever, and people have started to ask if I would like their seat on the bus. For some reason this never happens on trains, for which I am grateful, but it does on buses. Are people on buses just kinder? Because of my love of ocean racing on my boat and being an active person, I work hard at staying strong and fit, so I smile and say I prefer to stand. But all of the above is rather alarming.
A real bonus, though, is that work is winding down, our three kids are grown up and in a good place with study, work and relationships, so we have more time to travel by ourselves and with friends. I have always spent a lot of time in planes, mainly for work, surrounded by work documents. But now, apart from writing for Money magazine, which is often done on planes, I find I have more time to read.
It was with great interest that I was recently reading an article in The Washington Post by Heather Long and Leslie Shapiro (August 20, 2018) about the rapid change in global demographics. Australians are great travellers and if you are wondering why our great global cities are chock-a-block in tourist season, you would be right to think it is the growing global population. But more important is the wealth of this population.
It is well known that until the industrial revolution in the 1830s the population was either a prince or a pauper and the middle class did not exist. But today, very close to half of the world’s population, some 3.7 billion people, is now defined as being middle class. This means the ability to get by day to day with additional income left over to eat out, have a TV and a car, access to higher education or travel. Apparently, about 2.5% of the world’s population is “mega rich” and that means around 190 million people have buckets of cash.
The Washington Post has a calculator that will show you where you fit on the global income spectrum. But despite wages growth being slow in Australia in recent years, expect to be shocked. To make the middle class in many countries you need an income as low as $US4000 ($5600) a year. Even in wealthy countries $US40,000 will get you there.
I really enjoyed reading about Dollar Street, a Swedish non-profit organisation that has photographed the daily lives of over 250 families. It compares a family of five in Burundi living on $US324 a year with the same-sized family in China on $US121,000. A young couple in Indonesia, the Yanvars, were great to hear about. They are a teacher and social worker and have two young kids. They have electricity, a fridge and a motorbike. The kids are being well educated and have toys. They are saving money from their income of $US12,000 a year to buy a car and one day a home. And, yes, they are happy and optimistic.
It is worth you taking a look at the growth in our global population and increasing wealth. More people with more money mean more demand for goods and services. Where these people will live and what they will buy tells us a lot about where and how we should invest. Whether it is property or shares, increased demand is a vital factor.
I can understand us all feeling pretty negative about the state of politics and our planet in general. The media bombards us with bad news. But, in fact, the planet is a pretty good place for many billions of people who are living better lives than at any point in the past.
Australians can expect to be shocked by the global income calculator
Paul Clitheroe is Money’s chairman and chief commentator. He is also chairman of the Australian government’s Financial Literacy Board and a best-selling author.