What is Wealthy?

On a different thread (in the politics forum), a couple of veteran posters were discussing what it means to be wealthy. It got me pondering.

Phoenix wrote that she felt a couple needed to be worth no less than 2 million dollars to be considered wealthy. Nimh was surprised.

Is this a cultural difference? What does wealth allow you to do with your life? Is this even the way wealth should be defined? Is it a simple sum of your estate? Does a persona with 1 million become wealthy in New Mexico but not in Massachusetts? Do dependents figure in?

I have no idea what my sister's family is worth, but she has more money than anyone else in the family. They earn over 200,000 per year, their house was bought for around 800,000 several years ago. They have massive 401ks and saving for their kids grow a lot every year.

They don't consider themselves as wealthy. They don't even consider themselves as upper class. They often consider themselves cash-poor. Our perceptions are different, to say the least. So, is there a definition for wealthy?

What does wealth look like? A lifestyle or a bank account?

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What does wealth look like? A lifestyle or a bank account?

Wealth is a state of mind.

I'd love to have the income from two million dollars. I'd have a great deal of fun and do a certain amount of good--but I don't "need" that income.

I've got the sun in the morning and the moon at night.

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From wiki

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Wealth is the items of economic value that an individual owns while income is an inflow of items of economic value. Wealth needs to be differentiated from income because an individual also has expenses, which are an outflow of items of economic value.

........

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The United States is one of the richest countries in the world (2nd behind Kuwait), and in 2000, the mean wealth was $144,000 per person.

$144,000 per person mean?!?! Wow. Are we like houses? Do we include the costs for education in our net worth as we would a renovation on a house?

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I think wealth is being in a certain tax bracket or having a certain net worth.

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Amigo wrote:

I think wealth is being in a certain tax bracket or having a certain net worth.

What is the tax bracket and what is included/excluded in your net worth?

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To me, wealthy is never having to ask the price of anything.

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We are only able to evaluate things on the basis of comparison (whether with other people, or with standards we set....with something)... so the question would be wealthy as compared to whom or what? In the U.S.? In the world? Among western democracies? In the family? Among peers? The answers would be different in each context, I figure.

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From a 2005 Merrill Lynch article:

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The number of high-net-worth individuals (HNWIs) individuals with a net worth of at least U.S. $1 million, excluding their primary residence

Merrill Lynch

A whole set of definitions for various perceptions of wealth can be found at the link below - from anthropological to economical and many between.

WIKI

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dagmaraka wrote:

We are only able to evaluate things on the basis of comparison (whether with other people, or with standards we set....with something)... so the question would be wealthy as compared to whom or what? In the U.S.? In the world? Among western democracies? In the family? Among peers? The answers would be different in each context, I figure.

I would hope. That's one of the reasons I think nimh and phoenix didn't see eye-to-eye. They're from different cultures with different social structures (both cultural and political) and from different age groups.

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Dorothy Parker wrote:

To me, wealthy is never having to ask the price of anything.

I agree to a certain extent, Dorothy. It is never having to worry about whether one has to choose between buying one thing or another. It is not worrying that you would have to come to your kids for money in your old age.

It is not having to think twice about buying something that you need. It is paying something off purchases immediately, and not paying off credit card bills. It is not being concerned personally about a recession. It is the ability to purchase the service of attorneys, accountants, financial advisors, and even domestic help without having to figure out where the money will come from.

Now obviously, there is wealthy, and there is WEALTHY. When I talk about buying what you need, I am not discussing conspicuous consumption, a trait in some people that I find obnoxious. I think that there is a figure, and IMO, I have set it at about 2 million dollars, where a person can do the things that they want, without being too concerned if they can pay for it.

No, with 2 million, you can't have a private jet, houses all over the world, throw a million dollar wedding for your daughter, or spend your free time choosing baubles at Tiffany's. That is for the super rich, and in the scheme of things, there are not too many of those with regards to the total population.

I believe that when I think of wealthy, in my head it refers to what some would call the "upper middle class".

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Quote:

Does a persona with 1 million become wealthy in New Mexico but not in Massachusetts? Do dependents figure in?

littlek- I think that you have hit upon an important point. The cost of living varies widely from one part of the US to another. I would assume that there are some areas where one could live under my conception of "wealthy", but not in another.

For instance, housing costs vary all over the map. If a person wants to live in Manhattan, for instance, real estate is extremely costly. The same with food, taxes, restaurant meals, etc. Therefore, one could live very comfortably in one area, but feel somewhat impoverished, with the same net worth, in another.

Dependents absolutely make a difference. Again, using Manhattan as an example (because many high net worth people live there) you might want to send your child to a private school, which can be very pricey. It costs a lot to raise a child, more in some places than others.

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people also have different needs and different levels of satisfaction. while one might be content as a clam, another might feel awfully deprived at the same level of quality of life....

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dagmaraka wrote:

people also have different needs and different levels of satisfaction. while one might be content as a clam, another might feel awfully deprived at the same level of quality of life....

Exactly. Once we get beyond the absolute necessities, there are so many variables in terms of what a person believes is an adequate life style.

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Dorothy Parker wrote:

To me, wealthy is never having to ask the price of anything.

Thats what I do. I just shop where everything is dirt cheap and I am very wealthy.

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Phoenix32890 wrote:

I believe that when I think of wealthy, in my head it refers to what some would call the "upper middle class".[/b]

Besides that the definition of 'upper middle class' may vary even more than that of 'wealth' ...

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Sociologists Dennis Gilbert, Willam Thompson and Joseph Hickey estimate the upper middle class to constitute roughly 15% of the population. Using the 15% figure one may conclude that the American upper middle class consists, strictly in an income sense, of professionals with personal incomes in excess of $62,500, who commonly reside in households with six figure incomes.[14][17][1][8] The difference between personal and household income can be explained by considering that 76% of households with incomes exceeding $90,000 (the top 20%) had two or more income earners.[14]

Wikipedia

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Noddy24 wrote:

Wealth is a state of mind.

I like this sentence.

and for more stats you can look here:
...http://www.dol.gov/

Which has the following in one of their tables:

"Full-time1 civilian workers: Mean and median hourly, weekly, and annual earnings and mean weekly and annual hours, United States, June 20062

Annual earnings for all workers

Mean $41,231

Median $33,634"

Edit:Thanks Walter Hinteler I was looking for a table like the one you posted.

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Actually, some of the wealthiest people live quite frugal. Warren Buffet
still lives in his old house he bought in 1958, and he will think twice about
paying too much for something.

I have neighbors who are by assets rich but cash poor.

The more income you have, the higher your obligations will become.

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CalamityJane- One of my favorite stories concerns my grandmother's girlfriend. She and her husband were immigrants who came to the US with practically nothing. Through hard work, he built up a thriving business. He was very generous with his wife, and gave her lots of money. ( This is in the 1950's) She, used to being thrifty, still bought "on sale", and was quite frugal in her spending.

Anyhow, one day the man came to his wife, very upset. He had had some business reverses, and would be forced into bankruptcy. She walked away, and returned with a bank book. It contained $50,000, which was quite a sum in the 1950's. She saved her husband's business!

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That's a remarkable story, Phoenix, of which today's husbands only can
sigh, as some of the wives can spend far beyond their husband's
income.

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Yes, thats a good one.

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