U.S. millionaires say $7 million not enough to be rich

[haha]

Quote:

Originally Posted by youbet You are toying with the deepest, innermost, personal feelings of our fellow posters Ha. The very mores than make up our social construct are crumbling at your keyboard. Are you implying that the bliss achieved when first escaping from a hated job might dwindle away over years of not being able to afford a cold beer on a hot afternoon because you cut the budget too thin?

No implication at all, other to notice the dissonance between this frequently proclaimed lasting joy, and the almsot as frequently cited happiness setpoint. Both can't really be true, can they?

Ha

[youbet]

Quote:

Originally Posted by haha No implication at all, other to notice the dissonance between this frequently proclaimed lasting joy, and the almsot as frequently cited happiness setpoint. Both can't really be true, can they? Ha

I don't know about that Ha, but I could go for a Blatz right now! Since that's cheap beer and I'm rich (by someone's definition), why not?

Here's to ya buddy!

[haha]

Quote:

Originally Posted by youbet I don't know about that Ha, but I could go for a Blatz right now! Since that's cheap beer and I'm rich (by someone's definition), why not? Here's to ya buddy!

That must be the key to this unassailable happiness-DBM, drinking below your means. And salud to you! If you can't find any Blatz, just call "Hey Mabel, Black Label, Carlings Black Label Beer!"

Ha

[Major Tom]

Quote:

Originally Posted by MasterBlaster Is a million or two still rich ? U.S. millionaires say $7 million not enough to be rich - Yahoo! News- Is a million or two still rich ?

"High Society", for which Cole Porter wrote "Who Wants To Be A Millionaire" came out in 1956. Quite a bit has changed since then......

[traineeinvestor]

Two observations.

The first is that if "rich" (however defined) is relative to people you know, where you live and what you aspire to, you can feel richer simply by moving to an area where the cost of living is lower, socialising only with people who are poorer and lowering your aspirations.

Second, given the volume of "bash the rich" talk in the media (including comments on internet sites), concerns over rising inflation and economic uncertainty, it is little wonder that those who I call the marginal rich (most of the lesser HNWIs or low single digit millionaires) are feeling a bit paranoid about the impact of increased taxes on their incomes and properties, inflation on their expenses and economic adversity on their businesses, investments and jobs. The marginal rich may be rich by most measures and compared to most people, but, unless they are more frugal than most, they are not rich enough to be assured of maintaining their wealth (and, by implication, their standard of living) in the future.

IMHO, it is both reasonable and rational not to feel rich until you have enough to be confident that your assets are sufficient to maintain your desired standard of living indefinitely against all (or at least most) forseable forms of adversity. Given the amount of income (or SWR) you can expect from a portfolio of US$1MM, it's very understandable that many people with net worth of around that number would not feel rich.

[photoguy]

Quote:

Originally Posted by MasterBlaster Is a million or two still rich ?

In many parts of the country a 3-4% WR off a million dollars would have you living well below the median household income. For example, in San Jose, the median household income is about $80k.

[Westernskies]

Quote:

Originally Posted by unclemick I felt 'rich' this morning when using two NEW dryer sheets with the laundry.

Trying to get those Big Smith overalls all soft and fluffy?

[Dawg52]

I'm rich.

[txdakini]

Unless your retiree medical insurance is $18K per year for the two of you...which mine is.

[RetiredGypsy]

YouTube - If I Had $1,000,000 - Barenaked Ladies [BEST ONE]

[Mulligan]

I would imagine both "rich" and "poor" people would agree with Henry Ford's famous reponse to the question of "How much is enough?" His answer of course was "just a little bit more". Seems to fit me no matter how much or little I have made over the years.

[fritz]

Quote:

Originally Posted by traineeinvestor Two observations. The first is that if "rich" (however defined) is relative to people you know, where you live and what you aspire to, you can feel richer simply by moving to an area where the cost of living is lower, socialising only with people who are poorer and lowering your aspirations. Second, given the volume of "bash the rich" talk in the media (including comments on internet sites), concerns over rising inflation and economic uncertainty, it is little wonder that those who I call the marginal rich (most of the lesser HNWIs or low single digit millionaires) are feeling a bit paranoid about the impact of increased taxes on their incomes and properties, inflation on their expenses and economic adversity on their businesses, investments and jobs. The marginal rich may be rich by most measures and compared to most people, but, unless they are more frugal than most, they are not rich enough to be assured of maintaining their wealth (and, by implication, their standard of living) in the future. IMHO, it is both reasonable and rational not to feel rich until you have enough to be confident that your assets are sufficient to maintain your desired standard of living indefinitely against all (or at least most) forseable forms of adversity. Given the amount of income (or SWR) you can expect from a portfolio of US$1MM, it's very understandable that many people with net worth of around that number would not feel rich.

Pulling out your category of the marginally rich (under $5M investable assets) eliminates roughly 70% of all U.S. HNWIs. Leaving 30% of all HNWIs in the "rich" category might be an acceptable breakpoint for the upper <1% of all US individuals, but would guess the rest (+99%) of the U.S. population would consider $1M+ investable assets as still pretty much "rich".

[jdw_fire]

Quote:

Originally Posted by youbet No, it isn't $250k Don. I'm surprised at how many folks misunderstand this. It's $200k. The $250k applies to the combined income of a married couple filing jointly. In that case, if they each make the same amount, it's $125k each. At least that's how the proposal is being presented by the administration. You do seem the have the "marginal tax rate" concept OK. Yep, it's only the income over $200k that would be taxed at the top rate. My amazement is that there is no proposal for a higher marginal rate at a higher level than $200k. Say a bump up at $1 mil and another at $10 mil. It seems odd to want to put a dentist making say, $225k, in the same marginal tax bracket as Mr Gates. I just don't get it........ Why is the administration so concerned that the truly wealthy (Gates, Buffet, etc.) don't pay at a higher rate than say Mr and Mrs donheff? I'm not necessarily against having some new tax brackets that involve both new rates and levels of income. I just think the current proposal is quite dumb. It's too protective of the Super-Rich (who are super politically connected!).

currently the tax brackets for a single filer are (per Tax Brackets (Federal Income Tax Rates) 2000 through 2010 and 2011)

0 - 8375 10%
8375 - 34000 15%
34000 - 82400 25%
82400 - 171850 28%
171850 - 373650 33%
373650 and above 35%

based on the above a single filer earning just over $200k would not be in the highest tax bracket

my understanding of what Obama wanted to do re taxes was allow the Bush tax cuts expire for tax payers with incomes over $200K/yr for a single filer (and over $250k/yr for married filing jointly). that would actually raise part of the next to highest tax bracket thus creating an additional tax bracket. it would also raise the highest tax bracket

[Spanky]

Quote:

Originally Posted by Mulligan I would imagine both "rich" and "poor" people would agree with Henry Ford's famous reponse to the question of "How much is enough?" His answer of course was "just a little bit more". Seems to fit me no matter how much or little I have made over the years.

In other words, you will never be rich enough compared to other people worth even more.

[sheehs1]

Well.....after reading this thread...I now feel poor

[Ronnieboy]

All I know is that if I had $7 or $7.5 mill, I would be retired right about.....yesterday.

[Independent]

Quote:

Originally Posted by Tadpole Actually people seem to be smarter than I would have thought when asked this question. I always consider the $1M (after tax) to be 1955 or so since it seems to have been what people then considered rich. So according to the westegg calculator: "What cost $1000000 in 1955 would cost $7922698.13 in 2009. " People's feeling that 7.5M was "rich" is not that far off for a feeling when compared to the same "feeling" in 1955. For people too young to remember there was this TV show in the 50s where a billionaire gave $1M tax free to a person he chose. It was not a reality show, just entertainment. But people back then "felt" this was the definition of "rich".

I remember the show, and I sometimes do the same math that you do. In those days (I was pretty young) I figured that $1 million generated $25-30k in interest from a bank account, and that was a "very high" income.

[ziggy29]

Quote:

Originally Posted by photoguy In many parts of the country a 3-4% WR off a million dollars would have you living well below the median household income. For example, in San Jose, the median household income is about $80k.

And $80K is nothing compared to real estate prices there (he says as a former San Jose homeowner)...

[Independent]

I find it easy to understand why $1 million is "not rich" but $7.5 million is rich.

Using 4%, the $1 million converts into $40k of annual income. That's slightly below the median for a single worker, and well below the median for a couple.

But the same 4% converts $7.5 million into $300k annually. That's in the top 2% of all taxpayers.

[ziggy29]

Quote:

Originally Posted by Independent I find it easy to understand why $1 million is "not rich" but $7.5 million is rich. Using 4%, the $1 million converts into $40k of annual income. That's slightly below the median for a single worker, and well below the median for a couple. But the same 4% converts $7.5 million into $300k annually. That's in the top 2% of all taxpayers.

Or put another way, if we needed $50K per year for living expenses (probably ballpark for our lifestyle), with $1M we'd need a 5% withdrawal, whereas with a $7.5 million nest egg we'd only need a withdrawal rate of 0.67%. Heck, we could make it 1%, increase it to $75K and upgrade our lifestyle above that which we find acceptable.