Minimum income to be considered "Rich"

[BajanYankee]

The more I think about it, 7 figures sounds about right.

Let's look at Joe Responsible. He had a solid career, earning in the low 100s. Through smart saving and investing, he retires at age 60 with a net worth of $4M. Not bad.

Now let's look at Chad Superstar. He flew up the ranks at Goldman. Started pulling down 7 figures by his early 30s. If he invested 20% of his after tax income into a Vanguard index fund, he'd have nearly $40 million by age 60. Of course, having more money and access to better financial information and funds than Joe Responsible, he's probably invested in higher risk funds that have generated larger returns. So we could probably double that to $80 million. Throw in some real estate and he breaks the $100 million mark.

Personally, I would not call both of these guys "rich," especially after taking inflation into account. Joe has done well, but he did not have enough money to establish significant trust funds for his children. Nor does he have enough left over to make significant charitable contributions. He basically has enough money to live comfortably and enough to help his kids with a down payment. Chad Superstar's kids have had a totally different experience: his son is a DJ living in a Midtown Manhattan penthouse condo with a killer view of the Empire State Building and his daughter has worked in the Peace Corps but can inexplicably (to some people) afford her own house in Haight-Asbury San Francisco and the latest model Tesla. Both children live comfortably their entire lives on non-profit salaries.

[BajanYankee]

Originally Posted by elchevere

I would say $3-5M net worth is somewhat comfortable for a single person; not so for a couple, particularly with children and living in a coastal city….I would say “rich” starts at $10M net worth (gives most the opportunity to own a vacation home and/or yacht—not at $3-5M, boat maybe, not a yacht). What you described below, with philanthropic donations, is what I would call “ultra rich”, something an old friend of mine who lives in a $40M oceanfront home in Jupiter, recently donated $3.5M of art to a university, belongs to a country club, and supports a local religious organization on an annual basis is.

I also think age plays some role in this. A $3-5M net worth is fantastic at age 40 and has the potential to grow into something much bigger. I would call someone "rich" with a net worth that large at that age. That's very achievable for an I-Banker 12 years out of business school. The same net worth at 60+ isn't nearly as impressive. This is not to diminish the significance of achieving that type of net worth at any age, but a 40-year old worth $5 million and a 60 year old worth $5 million have likely had very different lifestyles and career trajectories.

[North Beach Person]

People are considered "rich" if they make a dollar more than the guy who's complaining.

[arr430]

As a general rule, I would say "rich" is having more income than it would be possible to make as a "wage-earner" -- i.e., as payment from someone else in for work performed. In cotrast to entertainers, athletes, etc., who are paid under contract with expectation of future performance.

In other words, nobody has ever gotten rich on paychecks every Friday.

[rnc2mbfl]

well, according to that, I'm not rich!