What Do You Consider Rich?

[metime]

To Obama anyone making over $250k/per year is rich.

I have a few relatives who have more than 10 million in assets, at least, but when you consdier they are retired and that the average American will need 1.5 milion in retirement to fund their average life, after they retire it is just about OK. When you consider the increase in life expectancy, a few million will maybe get you comfortably to the end. Throw in the healthcare and even wiht insurance it is costly in to your twilight years. In those last 20 years the cost of everything goes up.

If you throw in the fact that in some areas the average house costs over 400 grand then a few million does not go very far.

A single income family with 3 kids that makes $250k a year where I live (Boston) is going to be very middle class.

We lived much the same way on 30K a year as we do now making much much more. We still managed to save and we didn't go into debt even though we had no insurance during one of my pregnancies.

From my experience if you are over extended on what you make now (unless you live below the poverty line) you will be the same way if you make more. People who are in debt that make 50K a year will be in debt when they make 100K a year. If you look at credit as an entitlement or a way of life then you will always owe. For most of America living in debt is a way of life even when they make 6 figures so what you make has nothing to do with what you have if you are spending money you don't have at all.

our family of 4 could live on 25K a year if I had to easily and still feel rather comfortable. As it stands we spend a bit more than that but we manage to live on about 35% of what we have coming in.

Lots of people who have won millions in the lottery end up losing it all in a short time because they don't know how to manage money. If you are ill informed about money it really does not matter how much you have coming in.

If you mindlessly spend 5 dollars you will mindlessly spend 5 million the same way. More money just magnifies your money issues it does not fix them.

 

[Dancemom03]

What Diva said.
I will add, from a purley financial perspective, that living in a fairly expensive area of the country as I do (1 hour north of NYC), what seems like a lot of money to folks in some other areas of the country makes you very decidely middle class here.

or worse!

Somebody posted this location/salary comparison link the other day and I had a lot of fun playing with it dreaming about selling my home and living for years on our long accumulated equity in other areas. I picked random areas like Celebration, FL, input our salary and zipcode and had a ball. Ironically, when I clicked for advanced comparison many of the locations I'd randomly chosen had very close to the same demographics/population/ect as where we live now. And here I thought I was looking at getting away to begin a "different lifestyle"...

Most telling though was entering the zipcode we currently live in and that of the one I grew up in...

http://www.bestplaces.net/COL/

 

[The Mystery Machine]

To put it in a different perspective, if you can go anywhere in the USA and buy a home of your choosing in cash, under 30 million, you are rich.

If you can go all over the world and buy several homes above 30 million, you are wealthy.

 

[SydneyFalco]

Globally speaking, I think, if you're posting on these boards, you're pretty rich.

But if you want to get all North American-y, I suppose if a couple is making more than 200,000K per year jointly, I'd consider them very upper middle class without significant holdings, and definitely rich with holdings of any size to their name. The wife and I clear just over six figures together (Canadian) and, even though we live in a pretty pricey section of town, I think of us as extremely fortunate and upper middle class.

 

[luvmy3]

or worse!

Somebody posted this location/salary comparison link the other day and I had a lot of fun playing with it dreaming about selling my home and living for years on our long accumulated equity in other areas. I picked random areas like Celebration, FL, input our salary and zipcode and had a ball. Ironically, when I clicked for advanced comparison many of the locations I'd randomly chosen had very close to the same demographics/population/ect as where we live now. And here I thought I was looking at getting away to begin a "different lifestyle"...

Most telling though was entering the zipcode we currently live in and that of the one I grew up in...

http://www.bestplaces.net/COL/

Interesting website. According to them housing is 47% cheaper where I grew up than where I am living now.
Comparing where I lived in CA, housing is 371% more than where I am now. We'd be homeless if we were still living there, there is no way we'd ever be able to afford a home on dh's salary.

 

[pilesoflaundry]

To me it's having enough to get by every month. To never have to worry if you can buy your baby food or diapers or have the utilites shut off. It's not a set amount of money because getting by is different depending on where you live, how many people are in your family etc.

I consider making half a mill a year or more extremely weathy. Some kiconsider that just plain rich.

 

[The Mystery Machine]

To me it's having enough to get by every month. To never have to worry if you can buy your baby food or diapers or have the utilites shut off. It's not a set amount of money because getting by is different depending on where you live, how many people are in your family etc.

I consider making half a mill a year or more extremely weathy. Some kiconsider that just plain rich.

I consider that upper middle.

Rich to me means if you lose your job, you are not going to lose your house or go into any debt because you have alot of reserves to to live on until you go onto your next thing.

All your things are paid off and you have been banking/investing your paychecks instead of living off of them.

Wealthy people do not have to work.

 

[DWGal210]

I do. I could probably name 50 (uber wealthy) that I know personally. Of course I am in my 60s so those in my generation have had time to accumulate a lot.

But I also know a young man (early 20s) who literally was born in a mud hut in rural china who is making almost $200,000 a year (legally). He is VERY smart. I wouldn't consider him wealthy YET - as he probably owes a lot for his education, and he is helping a lot of extended family. But I'd bet on his future.

I went to a top business school - and I lived in Silicon Valley (home of Apple, Hewlett Packard, etc.) for most of my adult life. Lots of real wealth created there. Plus I now live in Arkansas - home of Walmart. Many individuals rose from extremely humble beginnings to great wealth.

Sure there are people who have inherited great wealth - but there are still people out there creating new wealth.

I agree with you - I though the same thing when I read the statment you bolded. It's a myth out there that the majority of those with money inherited it. As an example, I read not too long ago that something like 70% of the people on the Forbes billionaire list made their own money, didn't inherit it. (I'm going to look for that article so I can reference it here). Think Bill Gates, Oprah, etc.

I also think it bears noting that quite a few people I know who I would consider "wealthy" also manage their money very well. It's not that in their whole life they've made more money, they've just managed it better than some of their peers.

 

[EthansMom]

I would know many folks that others might consider "rich" in that they have decent homes, 2 cars, health insurance, good educations for their kids, a bit of savings, and can take vacations once or twice a year. However, most of those folks work hard to earn those things and can't just afford to quit their jobs. I would call such families "comfortable" rather than "rich".

For me, "rich" means having enough money that you can afford some of the trappings of wealth like an expensive house, housekeeper and/or nanny, private school, luxury automobiles, designer clothes, private school for the kids, etc...

However, I would agree that, in the U.S., most folks in the middle class and upper middle class are very rich compared to citizens in the rest of the world.

Of the people I know who are millionaires and multi-millionaires, most all of them are self-made through a combination of luck, good education, and hard work.

 

[Imzadi]

I attended a wealth seminar and there are actually two kinds of wealthy:

Financial Independence - where all your needs are met and your bills are paid. You have some extra saved & to spend. Your finances are secure. You're able to hold our own at that level, you are not worried about money coming in. You have cash flow. You're not reliant on someone else for a job or the money.

Financial Freedom - Most people would think that's being uber-wealthy, but it's whatever amount that means to you. You never have to worry about money again. It's where, whatever lifestyle you want to have, you can afford it and then some. If you are a couple with no kids, it may mean less than a family of 4 would need/want to have financial freedom. Or if the couple is really spendy, it may mean considerably more than the family of 4 need/wants to have for financial freedom.

 

[DMickey28]

I don't think you can put a dollar amount on the term rich. From a strickly dollar perspective $150K in one area will barely allow a small family to survive while in another area of the country you can live very comfortably on that.

Rich or wealthy to me is living any place that you want to live, going on any vacation that you want to, buying anything that you need or want without a second thought is monetary wealth.

We don't have a ton of money but we have enough. We also have a loving large family, our health and a new baby on the way ... how can we be anything short of rich? We are about to buy our first house in a beautiful town and finally settle down within driving distance to our families. DH is on the verge of a huge career move which, down the road, will provide us with the financial means to do what we want when we want, but right now we survive without having to watch our pennies, though we do watch the dollars.