If you have a networth of $1m plus do you consider yourself a "millionare"?

[Anonymous]

Our net worth is $1.4 million, but our income isn't high (by DCUM standards at least, we do very well in my opinion and I am grateful) - HHI is under $100k. Excluding our home our net worth is about $800k (some definitions exclude your personal residence).

When I picture a millionaire, it's certainly not me - not even close. Does the term mean anything any more? Aren't millionaires people who drive luxury cars, send their kids to boarding school, have personal cooks and maids and nannies, where designer clothes, socialize at the country club or on the golf course? Are billionaires the new millionaires?

[Anonymous]

When I did, I did not. To me, it was multiples.

[Anonymous]

Yes, we consider ourselves millionaires but of course would never say that in public about ourselves!

I read The Millionaire Next Door many years ago so I have always had a realistic view of what millionaire life is - modest cars and homes, minimal debt, stable careers or owning a non-glamorous business.

[Anonymous]

PP here, and yes, I would consider billionaires or "multi millionaires" to be where I assume more luxurious lifestyles. And for multi millionaire I mean over 10M. Under 10M in my mind is "enough to never worry and live off investments," but only with a relatively modest life (compared to size of nest egg) and good choices.

[Anonymous]

I find it ironic that I am a millionaire in net worth -- based on 401K balance and home equity, mostly...but I am living paycheck to paycheck.

[Anonymous]

I just got a new used car! I've never had a new car. We're kind of the millionaires next door. My husband still takes things out of the cart at Sam's Club because he thinks they're too expensive.

[Anonymous]

Weird. This question made me think Ha, of course we aren't millionaires. Then I did the math and realized that home equity + retirement = almost exactly a million. We are definitely living paycheck-to-paycheck, though. We are at least 30 years from retirement and certainly aren't about to sell our house (where would we live?) so none of that money is touchable.

[Anonymous]

Anonymous wrote:I find it ironic that I am a millionaire in net worth -- based on 401K balance and home equity, mostly...but I am living paycheck to paycheck.

You're not putting anything into home equity or 401k?

[Anonymous]

I don't consider home equity of a primary residence or vacation home. I only count productive, or income-generating assets. 401(k)s, stocks in a brokerage account, equity on a rental house, etc. Your primary residence costs you money, it doesn't earn you money, so it's more of a liability.

We own our primary residence outright, plus we have about $1.5M in investments, so based on the latter, I consider myself a millionaire. We're very much Millionaire Next Door types--public schools, normal cars, vacations at the lake--but our $1.5M in investments can be expected to, on average, generate about an 8% annual return, or $120,000 annually before either of us gets out of bed or sits down in a cubicle. If we wanted to live off of it, we could safely withdraw and spend 4% annually, forever, which is more than the median household income in the country.

[Anonymous]

No. It doesn't feel that way.

[Anonymous]

I always thought a millionaire meant you made income of a million or more.

[Anonymous]

We have $1.2 invested and own our home outright, so yes we are millionnaires. Doesn't mean we're buying a yacht, but it still feels good.

[Anonymous]

I will probably hit that point in about 15-20 years (I'm worth about $700K now as a single person), and I can tell you, I won't think of myself as a millionaire.

I'm so paranoid about outliving my money that I don't know that I'll ever truly be able to retire. The house will be paid off and my kid will be out of college before I'm 60, but I would worry too much about having nothing coming in.

[Anonymous]

Anonymous wrote:I always thought a millionaire meant you made income of a million or more.

The term was first popularized in the late 19th century, and at the time certainly referred to amount of assets, not annual income. Obviously, inflation has eroded its impact over the years.

[Anonymous]

Anonymous wrote:I will probably hit that point in about 15-20 years (I'm worth about $700K now as a single person), and I can tell you, I won't think of myself as a millionaire.

I'm so paranoid about outliving my money that I don't know that I'll ever truly be able to retire. The house will be paid off and my kid will be out of college before I'm 60, but I would worry too much about having nothing coming in.

So buy an annuity when you retire. No more worries.