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

[Danmar]

Who knows what "rich" means. Obviously a personal thing. Why does it matter? As long as you have enough for your lifestyle? Seems to me that the term "rich" has taken on a negative connotation anyway. I much prefer the terms well off, comfortable, set, or even better just plain "lucky".

[Bestwifeever]

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Originally Posted by youbet 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....

A survey of people who live on $30k annually would probably reveal that $40k/year is rich.

[youbet]

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Originally Posted by Bestwifeever A survey of people who live on $30k annually would probably reveal that $40k/year is rich.

Do you really think so? I don't. The $30k folks would certainly label the $40k folks as "better off." But a asset base of one mil generating $40k of taxable income doesn't support the lifestyle most think of as "rich."

Maybe you're saying that the $30k crowd can't differentiate between the medical specialist and his lawyer wife who make one mil a year and the factory worker making $40K? I think they can and would acknowledge the difference.

But it's all semantics and your personal perception I guess. After all, the current administration says anyone making over $200k is "rich," even with no other assets, and wants to tax them in the same bracket as Bill and Melinda. So, it's all in the eye of the beholder.

[haha]

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Originally Posted by aaronc879 A very large majority live on less and manage to get by.

I don't believe that is true. A very large majority work, and have household incomes over $40,000. Another goodly number have several families or working people living under the same roof, or in the same smallish rental unit. And some of those who do live on less may have less cash income, but have various aid payments, are non-taxpayers, get food stamps or rent chits. Then there is unreported income, not a small amount among certain groups.

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If you live in a coastal city then it may be difficult but that's not most places.

I believe that over 50% of the country, a majority by most definitions, do live in coastal cities.

I also think it is more likely that your situtation is atypical, not mine.

Ha

[Bestwifeever]

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Originally Posted by youbet ....So, it's all in the eye of the beholder.

Exactly.

[Loop Lawyer]

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Originally Posted by youbet 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.

Or maybe you wouldn't. The principal of "hedonic adaptation" says we all tend to revert to a baseline feeling of happiness / unhappiness regardless of both negative and positive events.

[donheff]

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Originally Posted by youbet But it's all semantics and your personal perception I guess. After all, the current administration says anyone making over $200k is "rich," even with no other assets, and wants to tax them in the same bracket as Bill and Melinda. So, it's all in the eye of the beholder.

It is $250K isn't it? And the higher tax rate applies only to taxable income over that limit. Any income in the top bracket (whether it is set to 39%, 35% or less) is in the "same" bracket as the Gates'. Doesn't actually mean anything. Until last year (when DW and I both entered the withdrawal stage) our marginal earnings had been in the top bracket for many years. But no one confused us with Bill and Melinda

[MasterBlaster]

$200k, $250k whatever.

In Manhatten, that kind of income will put you in the middle, not at the top.

But in Peoria, with that kind of income you'd do very well.

[sheehs1]

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Originally Posted by donheff It is $250K isn't it? And the higher tax rate applies only to taxable income over that limit. Any income in the top bracket (whether it is set to 39%, 35% or less) is in the "same" bracket as the Gates'. Doesn't actually mean anything. Until last year (when DW and I both entered the withdrawal stage) our marginal earnings had been in the top bracket for many years. But no one confused us with Bill and Melinda

$250K per couple, $200K single...is my understanding...
My husband and I need to get divorced.

[chinaco]

If $7.5M is the minimum amount to be rich... Are you at least fractionally rich?? 1/3 rich, 1/2 rich, 2/3 rich... or totally rich (=> $7.5M)?

[MasterBlaster]

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Originally Posted by sheehs1 $250K per couple, $200K single...is my understanding... My husband and I need to get divorced.

That and other similar tax thresholds, are what define the so-called marriage penalty.

[fritz]

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Originally Posted by Danmar Who knows what "rich" means. Obviously a personal thing. Why does it matter? As long as you have enough for your lifestyle? Seems to me that the term "rich" has taken on a negative connotation anyway. I much prefer the terms well off, comfortable, set, or even better just plain "lucky".

Most references to "Rich" are as "High Net Worth Individuals"
(Wikipedia)
A high net worth individual (HNWI) is a person with a high net worth. In the private banking business, these individuals typically are defined as having investable assets (financial assets not including primary residence) in excess of US$1 million.
(SEC)
The U.S. Securities and Exchange Commission requires all SEC-registered investment advisers to periodically file a report known as Form ADV.[6] Among other things, Form ADV requires each investment adviser to state how many of his clients are "high net worth individuals." The Form ADV Glossary of Terms explains that a "high net worth individual" is an individual with at least $750,000 managed by the reporting investment adviser, or whose net worth the investment adviser reasonably believes exceeds $1,500,000 (or who is a "qualified purchaser" as defined in section 2(a)(51)(A) of the Investment Company Act of 1940). The net worth of an individual for SEC purposes may include assets held jointly with his or her spouse. Unlike the definitions used in the financial and banking trade, the SEC's definition of HNWI would include the value of a person's verifiable non-financial assets, such as a primary residence or art collection.

The World Wealth Report 2010 shows the US having 1% HNWIs: World Wealth Report 2010 Pdf Free Ebooks (pdf , doc , xls and etc.)
(PDF of report is too large to attach)

EDIT: (should be easier source for report)

http://www.trigoncapital.com/upload/...eport_2010.pdf

If you go by the above criteria: Rich = HNWIs (which are those with investable assets of $1M or greater). Maybe that roughly 1% (+/- 2.9M) of the total US population that are classified as HNWIs don't view themselves as "Rich", but would guess the other 99% most likely do.

[MasterBlaster]

The report goes on to define Ultra High net Worth individuals as the top 1% of the High Net Worth Individuals. This then would represent the top .01 % of the population (1% of the top 1%).

As the article states, it would take around $30M to join the UHNW club.

Are you in ?

[fritz]

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Originally Posted by MasterBlaster The report goes on to define Ultra High net Worth individuals as the top 1% of the High Net Worth Individuals. This then would represent the top .01 % of the population (1% of the top 1%). As the article states, it would take around $30M to join the UHNW club. Are you in ?

Not the UHNWs..... You?

[Danmar]

Quote:

Originally Posted by MasterBlaster The report goes on to define Ultra High net Worth individuals as the top 1% of the High Net Worth Individuals. This then would represent the top .01 % of the population (1% of the top 1%). As the article states, it would take around $30M to join the UHNW club. Are you in ?

Let's just say I feel well off, set, and very lucky. However you want tp define it.

[youbet]

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Originally Posted by donheff It is $250K isn't it? And the higher tax rate applies only to taxable income over that limit. Any income in the top bracket (whether it is set to 39%, 35% or less) is in the "same" bracket as the Gates'. Doesn't actually mean anything. Until last year (when DW and I both entered the withdrawal stage) our marginal earnings had been in the top bracket for many years. But no one confused us with Bill and Melinda

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!).

[haha]

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Originally Posted by Loop Lawyer Or maybe you wouldn't. The principal of "hedonic adaptation" says we all tend to revert to a baseline feeling of happiness / unhappiness regardless of both negative and positive events.

Perhaps that is an invalid concept. Most people on this forum report entering a state of unending bliss within a short time after retiring, and maintaining or increasing this happiness over time.

Of course, they could be lying.

Ha

[donheff]

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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.

That is what I was thinking of since I only pay attention to my situation

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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.

I agree on both sentiments.

[youbet]

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Originally Posted by donheff I agree on both sentiments.

I'm finding that a very hard position to debate.

I guess it's time for a Guinness then.........

[youbet]

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Originally Posted by haha Perhaps that is an invalid concept. Most people on this forum report entering a state of unending bliss within a short time after retiring, and maintaining or increasing this happiness over time. Of course, they could be lying. Ha

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?