How they lived on interest on capital 150 years ago

Every fifth Russian

To Russia the idea of living on passive income

In our country, a new social stratum began to take shape after the abolition of serfdom in 1861. In the questionnaire of the first general population census of the Russian Empire, which

The census also made it possible to find out the total annual income of Russian rentiers — 397.1 million rubles. It turns out that, on average, one rentier received about 1,200 rubles a year annually. Not bad when compared to a worker in Moscow who

This is what the aggregate income of Russian rentiers consisted of:

As you can see, securities attracted rentiers more than deposits — they brought on average only 3-4% per year. This is comparable to the current rates on bank deposits — in the last year they

Most domestic investors lacked information about the situation in various sectors of the economy, which is why they were afraid to invest in shares of private commercial and industrial companies.

They belonged to hard-interest securities, because they brought a certain and constant interest. They were especially loved by conservative investors, including the writer Ivan Turgenev. He, though

Popular with conservatives also

When a lower interest rate was set on the next issues of bonds and land securities, the rentier

But it is difficult to become a full-fledged rentier with 5% per annum: in order to live on such passive income, an investor had to invest significant capital in securities. Those who did not have it invested in riskier, but profitable shares of private companies — they

They worked like this: the investor contributed a certain amount to the bank, and the lender provided him with a loan to buy securities. The size of the loan was 3–8 times higher than the initial payment. The assets purchased with this money remained secured in the bank, and the investor received dividends from them. Of the loan amount, the bank usually withheld 6.5-8% per annum in its favor. In fact, it was a tool for margin trading, or leveraged trading.

For a rentier, such a scheme of work was fraught with high risks: on the one hand, if the exchange rate fluctuated, the oncolist could go into a deep minus, on the other, he could be deceived by the bank itself. Especially if the creditor was not a reputable financial institution, but small banking houses. Those willingly

Experienced rentiers bypassed would-be financiers and preferred the on-call accounts of large banks. There is a minimum down payment

There were also rentiers in Russia who received passive income not from securities, but from the lease of real estate — tenement houses. For the first time they

If in Europe the average annual profitability of such a house is

By the beginning of the 20th century, the smallest closets in apartment buildings cost from 5 rubles a month (almost

It is interesting that not only large capitalists and industrialists lived at the expense of tenement houses. In Moscow, for example, small apartment buildings were owned by