What net worth is considered wealthy? Middle class? Poor?

[Anonymous]

Anonymous wrote:"You guys think we are poor?"

personally, I know I'm not. We're very lucky. We have everything we need. But there is this strange culture on this board, where $400k or $10m is "not wealthy". I don't understand it at all. These people are obviously making very poor choices about how to spend their money if they don't recognize how wealthy they are. We have about $1.6m net worth but live off our sub $100k HHI. We are happy. I consider our family to be very well off. But I clearly have a very different frame of reference to most on this board. This isn't because I'm bragging, it's because I appreciate what I have and find it unreasonable and distasteful to claim that $10m or $400k or $150k for that matter, is not "enough" when it is many multiples of what most REAL/NORMAL people live on.

[Anonymous]

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Anonymous wrote:I'd say 7-10 million without considering home equity and retirement. We have about 3 million after those things and I don't feel wealthy. We still have to go to work (HHI is 1.3M) since we couldn't live for the next 50 years on our 3 million in investments. We are cash rich, but not wealthy.

I know how the PP feels. Even at 10M, at least in this area, it's not enough to be materially wealthy.

We recently had vacation with a friend in the midwest. We could see $10M as wealthy there.

Come now. $10M without retirement savings or home equity is not wealthy? What a fascinating point of view.

Exactly. The "without retirement savings or home equity" is the silly part. I can totally get someone who has a several million dollar net worth saying they don't feel wealthy on a day-to-day basis because it is all in retirement and home equity. If you have millions in investments separate from your retirement savings and you don't feel wealthy, spend some of your money.

My retirement savings is only something like $500k. Add in home equity of $2M, and that's $12.5M. $10M and $12.5M is similar on the "how wealthy one feels" scale. I'd wager very few people, even the higher income ones, have significantly more retirement savings or home equity to the point that it tilts the balance the other way. The key point is that even $10M of non-retirement non-primary-home-equity money isn't enough to make one feel materially wealthy.

I think you need to define what "wealthy" means. This screams wealthy to me.

Wealthy to me means being able to maintain my current lifestyle in step with inflation from passive income only. I need $500k a year in today's money to maintain my current lifestyle. That requires 5% low risk cashflow on $10M, which is a tough proposition currently.

I'm impressed you're able to frame your definition in financial terms, but it's ultimately totally nonsensical. What you're saying is that the only people who are wealthy are those that would not desire any more money even if they quit their jobs. You've defined "wealthy" as "the point where the amount of money you are making is categorically irrelevant to your lifestyle." That's extremely silly.

[Anonymous]

You can't get 5% of passive income on $10 million?

You're doing it wrong. Presumably you have a mix of stocks in REIT, energy, consumer staples, and medical earning you at least 5% (should be much higher if you let them compound over years).

If you don't have any investments in REITs, perhaps you have some commercial real estate?

I only have about $1 million, but my yield on cost from dividend paying stocks is more than 5% and thats mostly just boring old dividend champions/aristocrats acquired over 15 years and reinvested.