It's fun to think about how rich people spend their money. We usually think of luxury purchases like expensive clothes and goods, or things we see in movies about billionaires. But experts say there's a lot more to how they spend their money than we might think.
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From luxury cars to lavish vacations, private jets and even private islands, there seems to be no limit to the amount of money the wealthy are willing to spend on luxuries, says Paige Robinson, real estate investor and owner of House Buyers. “It's fair to say that the wealthy and affluent often spend their money on over-the-top, expensive items that most of us can only dream of.”
“In fact, some of the most expensive things the wealthy spend their money on include private yachts, art collections, exclusive celebrity experiences, and top-of-the-line appliances,” she explained. “Whatever it is, if it's expensive and luxurious, the wealthy will find a way to buy it.”
Read on to find out about some of the excessive spending habits the ultra-rich often engage in.
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Private jets and aviation
“Private jet ownership is the epitome of luxury travel for the wealthy,” says Alec Kelsey, CPA at File Smart Tax. Aside from the convenience of avoiding commercial airports, private jets offer the ultra-wealthy personalized service, spacious interiors and the ability to travel on their own schedule, Kelsey says. “Some ultra-wealthy individuals even go so far as to customize their jets with premium materials and amenities.”
Find out: 7 ways the middle class spends their money that hurt their chances of getting wealthy
High Fashion and Couture
Experts say fashion is a way for the ultra-rich to show off their wealth and style. They can spend thousands, or even millions, of dollars on designer clothes, accessories, and jewelry. Kelsey said the wealthy are into high-end designer fashion and haute couture clothing, which is often custom-made to fit their tastes.
From bespoke suits to one-of-a-kind dresses, these luxury fashion items not only signal status but also function as wearable works of art. “Luxury brands and big-name designers cater to this elite clientele by creating exorbitantly priced, limited-edition pieces,” says Kelsey.
Fine wines and rare spirits
“Collecting and investing in rare and vintage wines and spirits is a passion for many wealthy individuals,” Kelsey emphasized, noting that a personal cellar filled with prized bottles from famous vineyards or limited-edition distilleries is a sign of sophistication and connoisseurship. “Wine auctions and exclusive tastings offer opportunities to further expand these prestigious collections.”
Fine Dining Experience
Kelsey says gourmet dining is a luxury affair for the wealthy, who enjoy special culinary experiences. This can include hiring celebrity chefs for private dinners, dining around the world and creating elaborate gastronomic events. “The pursuit of unique and exquisite flavors adds a sensory dimension to their lavish lifestyle,” he adds.
Space tourism venture
Experts say the rise of space tourism is encouraging wealthy individuals to venture beyond Earth. Private space tourism involves booking a seat on a commercial space flight or funding a space exploration venture. “The costs of these endeavors are astronomical,” Kelsey says. “They reflect not only the technical challenges, but also the exclusivity of being one of the few people who get to experience the vastness of space firsthand.”
According to Anton Radchenko, lawyer and founder of AirAdvisor, experiences are some of the best things you can spend money on, and the ultra-rich are taking full advantage of this. “While some people save up airline miles to save money on international travel, the ultra-rich are leaving Earth,” he said. “Virgin Galactic has sold tickets to space to the public for $450,000 a ticket, which gives you breathtaking views of Earth.”
Luxury Watches & Jewelry
Luxury watches and jewelry are not only functional accessories, but also serve as status symbols for the wealthy. “Limited edition watches from prestigious brands and custom jewelry featuring rare gemstones and exquisite craftsmanship are popular with collectors,” Kelsey points out. “These items are not only decorative, but will also increase in value over time.”
Excessive spending on domestic workers
Shanal Agarwal, a technology expert at TechAhead, said sharing household chores is a common dream among the wealthy, but added that hiring an assistant is a big financial mistake.
“Hiring cleaning staff can save you a lot of money compared to hiring a full-time maid,” he explained. “A personal chef is expensive — $50 to $75 an hour, plus supplies. A full-time chef can cost $100,000 to $150,000 a year, which is more expensive than buying takeout or cooking your own food.” Even if having a staffed home is an appealing dream, carefully examining the costs shows it's just another way the wealthy waste their money, he said.
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This article originally appeared on GOBankingRates.com: 7 Common Excessive Expenses of the Ultra-Wealthy
