Obviously for an American a pre-tax income of 4% of $1mm, or $40,000 is not even remotely rich. It isn't even modestly sufficient in most places and under most circumstances, unless of course you have rich cola retirement streams from public funds in addition to your $1mm.
Ha
Exactly.
While DW and I could get by on $40k, there is no way I could consider myself "rich" in the way I define the term. At $40k we'd be living modestly with little/no travel or entertainment expense and with a 5% chance or so we'd run out of money before death. Hardly what I'd call "rich."
In Chicago, by the time you purchased health insurance or paid for your Medicare and paid your taxes, it would be a challenge to comfortably pay for food, clothing and shelter.
I know many will chime in and add other assets and income sources such as a paid-for house, a paid-for car, free medical insurance, SS or some other pension. But, if you have those things, then you have more than the mentioned one million bux.
I would have never RE'd on a FIRE portfolio of one million without other assets or income. Way, way too much risk that expenses will uncontrollably rise above $40k and you'll wind up living in a box under a bridge in your 80's.
Edit: Although we're arm wrestling over being "rich" with one million bux, the article referred to 7 mil. Now, that's a different story. With a net worth of 7 mil, I imagine I'd feel rich. On an annual budget of a quarter mil or so, we'd have a nice home, nice cars and could afford a significant amount of travel and entertainment without worry. For me, that would inch me over the line into "rich." Although Bill and Melinda certainly wouldn't be seeking us out as social chums I'm sure!
