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$2.27 million to feel wealthy - 3% withdrawal rate
Old 06-05-2019, 08:41 AM   #1
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$2.27 million to feel wealthy - 3% withdrawal rate

Just another fluff piece, but this year's survey says it takes $2.27 million to feel wealthy.

https://www.cnn.com/2019/05/31/succe...thy/index.html

What I found most interesting though is this:

"For many people, being wealthy means being financially independent and not having to work for a living, says Bradley Nelson, of Lyon Park Advisors. He says a family with a net worth of $2.27 million could easily be wealthy.
If that family spent a conservative 3% of their assets each year, they would have $68,100 a year to live on. That's more than the median household income in the United States of $61,000 -- without even having to work."

Notice the 3% in there? I'm surprised to see it in a mainstream publication instead of the typical 4%.

The full report with a lot more statistics is here for the statistic hounds:

https://content.schwab.com/web/retai...-0519-9JBP.pdf
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Old 06-05-2019, 08:45 AM   #2
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....it takes $2.27 million to feel wealthy.....
It would take a lot more than that at our house to feel wealthy.
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Old 06-05-2019, 08:57 AM   #3
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I would feel wealthy with half that but i'm single and have always been a low spender since I have never made $50K+/yr in my life.
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Old 06-05-2019, 08:58 AM   #4
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I retired 5 years ago in a LCOL area with about $2.6 million, and it's now a little over $3 million. I don't think of myself as "wealthy" because I drive a 7-year old Nissan Sentra, bought used, I'm wearing a T-shirt right now that's over 30 years old, I get my hair cut at Great Clips, etc. Ah, but then there's my travel budget.

Yes, I guess I AM wealthy. I prefer to be quiet about it, though.
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Old 06-05-2019, 08:58 AM   #5
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It would take a lot more than that at our house to feel wealthy.
+1

The more you have, the more it takes to feel wealthy.
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Old 06-05-2019, 09:16 AM   #6
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Does $2.27m include a home equity? I hope not. $2.2m CASH would be a little different.

Disclaimer, this is my initial observation based on the OP, I have not read the whole article yet.
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Old 06-05-2019, 09:22 AM   #7
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Yes. One needs to have $2.2M in cash, as a buffer to the stock/bond AA to feel wealthy.

Now, that would be RICH!
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Old 06-05-2019, 09:26 AM   #8
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He says a family with a net worth of $2.27 million could easily be wealthy. If that family spent a conservative 3% of their assets each year, they would have $68,100 a year to live on.
Does he understand the difference between net worth and liquid savings and investments?

A family with a net worth of $2.2 million may have a house worth $500,000 and savings of $1.7 million, and their withdrawal rate would be 4%, not 3%.
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Old 06-05-2019, 09:29 AM   #9
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Yes. One needs to have $2.2M in cash, as a buffer to the stock/bond AA to feel wealthy.

Now, that would be RICH!



....until you factor in the cost of healthcare. Fix my HC costs until medicare age and I'm finished...otherwise
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Old 06-05-2019, 09:31 AM   #10
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Well over that just in cash and I don't feel wealthy. Comfortable yes, but not wealthy.
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Old 06-05-2019, 09:32 AM   #11
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I think my definition of wealthy if very different than the articles.. I mean being able to generate slightly above the average American salary puts one in upper middle class, not wealthy status.

To me wealthy means never having to look at what something costs before you buy it. $68k would still require a fair amount of budgeting.

I think you have to be uber-wealthy before you buy your own jet and own a yacht with staff, but a wealthy person should be able to fly first class, go to galas, get an expensive hobby, etc without limits.. no way you are doing that on the numbers they proposed.

Of course, MOST Americans will never get anywhere close to $2.27M so for them they think they would feel wealthy until they have that and the harsh reality of "but you are not" sets in. I call it comfortable, someone with $2.27 is comfortable and can get nice things occasionally and doesn't struggle day to day.
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Old 06-05-2019, 09:33 AM   #12
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Well over that just in cash and I don't feel wealthy. Comfortable yes, but not wealthy.
Ha funny we both thought the same word at the same time.
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Old 06-05-2019, 10:14 AM   #13
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Wealthy where the median income is $115,000, or wealthy where it's $20,000?
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Old 06-05-2019, 10:20 AM   #14
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Does $2.27m include a home equity? I hope not. $2.2m CASH would be a little different.

Disclaimer, this is my initial observation based on the OP, I have not read the whole article yet.
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Yes. One needs to have $2.2M in cash, as a buffer to the stock/bond AA to feel wealthy.

Now, that would be RICH!
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....until you factor in the cost of healthcare. Fix my HC costs until medicare age and I'm finished...otherwise
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Well over that just in cash and I don't feel wealthy. Comfortable yes, but not wealthy.

When an earlier poster says $2.2M in CASH (in capital), I take that as cash in addition to stocks and bonds, like in an AA of 60% stock, 35% bond, 5% cash.

If I had that, yes I would feel rich. And I would not worry about healthcare cost.

PS. But then, someone with that still could not afford a real yacht nor a jet, which is more than his total networth. He might not feel rich either.
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Old 06-05-2019, 12:00 PM   #15
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If one has 2.2m in investments plus some SS and possibly pensions, one might not be wealthy but could be very comfortable.
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Old 06-05-2019, 12:10 PM   #16
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Nuts, I already thought I was wealthy, sitting here in my PJ's at noon still drinking coffee on the deck! I feel rich just workin' at nothin' all day.

With 2.27 mil I'd really go crazy, like move to San Diego, or at least buy an RV or, heaven forbid, a boat. Oh well, folks always said I was a slow learner...
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Old 06-05-2019, 12:42 PM   #17
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Yes, I guess I AM wealthy. I prefer to be quiet about it, though.
+1 We live in a +55 MHP, with a lot of people living on SS. NOBODY has any idea what we have, and we will keep it that way.
It was a little difficult last year, when we bought 2 new cars, and I made an offhand remark about car payments.
I was talking to someone the other day, who asked how long we had lived here. He said,"Do you mind if I ask you how much you paid?". I said , "yes", and that ended that discussion. At least he had the courtesy to ask.
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Old 06-05-2019, 12:48 PM   #18
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.... He says a family with a net worth of $2.27 million could easily be wealthy.
If that family spent a conservative 3% of their assets each year, they would have $68,100 a year to live on. That's more than the median household income in the United States of $61,000 -- without even having to work."

Notice the 3% in there? I'm surprised to see it in a mainstream publication instead of the typical 4%.
I am not surprised since 4% was for someone in their 60's and not for a family. In this context I will assume "family" means a household with school-age children iiving at home.
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Old 06-05-2019, 01:23 PM   #19
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Nuts, I already thought I was wealthy, sitting here in my PJ's at noon still drinking coffee on the deck! I feel rich just workin' at nothin' all day.

With 2.27 mil I'd really go crazy, like move to San Diego, or at least buy an RV or, heaven forbid, a boat. Oh well, folks always said I was a slow learner...
With that money, if you move to SD, you can buy a little condo of less than 1,000-sq.ft.

Anything bigger, you will not have enough left to eat.
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Old 06-05-2019, 01:30 PM   #20
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Ah, last night I was surfing youtube looking at travel videos. I watched some intrepid travelers who went to Belarus, Moldova, Southern Urals, etc.... There was a guy who ventured into the forbidden radiation zone of Chernobyl, and found an old man living there alone.

Boy, seeing how people live in this day and age makes me appreciate what I have. Just came back from a car trek through the countryside of Portugal and Spain, which was nowhere as bad as the above, I knew how people lived.

Heck, just in my extensive RV trips through the corners of US and Canada, I saw plenty too.

Rich, rich, rich... It's all a state of mind.
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