What Does Being a Millionaire Really Mean?

[Salaryman]

Geoffrey hit it on the head previously....it's just an arbitrary number, that's all.
We have a number of friends that have made an enormous amount of money in their businesses but our friendship remained due to the fact that they did not let the money thing warp their lives and their world.
If you think you're well-off, there's always someone better-off than you and someone worse-off as well.
As they say, ya gotta keep it REAL.

 

[Enuff2Eat]

million dollars = a little closer to RE

 

[Tadpole]

dex and medit8,

Look at the numbers again carefully. I think the first one is taking $1M in 1955 dollars and inflating it forward to 2006, the second one is taking $1M in 2006 dollars and "un-inflating" it backward to 1955.

2Cor521

Yes, and more specifically, these numbers would seem to refer to the bucket of goods used to compute inflation over the years. It is questionable to me, though, that the inflation calculation gives an equivalence in perceived "wealth" since "wealth" seems to be defined by keeping up with increasingly more affluent life styles. Also, this period of time included some very high inflation years that may or may not occur again.

 

[Bikerdude]

Having a million dollars is better than not having a million dollars.

 

[Khan]

"Having more money does not insure happiness; people with ten million dollars are no happier than people with nine million dollars"
-Hobart Brown

 

[MasterBlaster]

John D. Rockefeller - "It is wrong to assume that men of immense wealth are always happy"

 

[Bikerdude]

Let me smile with the wise, and feed with the rich.
Samuel Johnson

 

[Webzter]

Show me the money! -Jerry Maguire

 

[ScottFromUtah]

"A Gallup survey asked people who made $10,000 a year, 'Who is wealthy and happy?' Their response was, 'That’s simple—people making $50,000 a year.' So Gallup went to folks making $50,000 and asked the same question. Their response was, 'People making $100,000.' For people making $200,000, the sense of who is wealthy and happy was a couple of million dollars. We tend to push the bar above and beyond where we are, no matter where we are..." --Dan Baker, Ph.D.

 

[audreyh1]

IMO having a million dollars does mean quite a lot. It might not be quite enough for retiring or complete financial independence. But it DOES bring a much greater degree of financial independence. It is a WHALE of a cushion. If you lose your job, you're not devastated - you have time and the flexibility to regroup and choose your future wisely. Even knowing you have that cushion can give you more of a feeling of freedom in your job and less a victim of the whims of others. If you are hit with a major illness, you have the wherewithal to get through it. You might not be able to retire, but you can weather life storms much more easily - much more on you own terms than someone elses's.

That is worth a lot!

Audrey

 

[loosechickens]

Well, we're there, and a bit more, in liquid assets. Nothing much has changed. All it means is that there is more than enough. We don't spend all the income. We don't have to worry about money or if the truck needs repairs, etc. We can look forward to our fall in Europe without really worrying about how the dollar is doing against the Euro.

I don't know that we'd do much different if we had ten times as much or ten times less. Most of the things we really enjoy doing (with the exception of the Europe trip, of course), don't cost much money to begin with. When you go off on a hike, who cares whether you've got $100,000 or $1,000,000 or $10,000,000 in the bank? Your feet get just as tired.....

It's nice to have it. It's more than enough. But it's not nearly the big thing people think it is. It's just pleasant.....but it was pleasant when we didn't have much, as well. Who knows?

I do find it surprising that all the websites and many here think that a million in liquid assets is hardly enough to keep body and soul together. Must be discouraging to all the folks we've met who have retired on much less....heck, they thought they were enjoying life all this time. I feel kind of sorry for people who think that a million dollars is not enough for them when there are so many to whom it would be excessive in the extreme.

Funny thing...sometimes I think that the less you care about money, the more it finds you. Sure has been true in our case. We were saving by nature, and frugal in our tastes, and the Universe has insisted on showering us with money despite (or maybe because) of that. Who knows?

LooseChickens

 

[MJ]

"Having more money does not insure happiness; people with ten million dollars are no happier than people with nine million dollars"
-Hobart Brown

But I suspect, they might be happier than someone with only one dollar in his/her pocket.

Besides with a lot of extra money you can do some good through donations and that might make you even happier.

MJ

 

[me_no_boss]

"Having more money does not insure happiness; people with ten million dollars are no happier than people with nine million dollars"
-Hobart Brown

" I am no happier today with $45M than I was with only $39M." - Governator Arnold, tongue in cheek.

I probably mangled the quote, but you get the idea.

Not to start a flame war, but something Kiosaki said last night on CNBC Millionaire Inspired resounded with me.
"Security and independence are opposites..."
The quest for maximum (financial) security could parallel a prison sentence if your job is ruining your life.

 

[FinanceGeek]

I am as excited about the possibility of being rich as the next fellow, but I do like to remind people that the richest man who ever lived died a miserable death of malnutrition...Howard Hughes...

 

[kcowan]

..."Security and independence are opposites..."
The quest for maximum (financial) security could parallel a prison sentence if your job is ruining your life.

And then their is this:
In Silicon Valley, Millionaires Who Don’t Feel Rich - New York Times
For example:

"People around here, if they have 2 or 3 million dollars, they don’t feel secure,” said David W. Hettig, an estate planner based in Menlo Park who has advised Silicon Valley’s wealthy for two decades.

 

[brookiel]

Hi

Yeah I used to think $1,000,000 was like winning the lottery when I was a kid, and now I have paid off my mortgage and have that money in my house - well it's like WOW I am a millionaire - so to speak.

 

[Sam]

brookiel, are you the author of "Retire To Asia"?

If not, have you read it? What do you think of it?

 

[Elspeth]

And then their is this:
In Silicon Valley, Millionaires Who Don’t Feel Rich - New York Times

Well, Silicon Valley is a bit atypical, with the idiotic house prices. If you're having to pay a mortgage on a $1.5M 50-year-old 1500-sqft 3-bedroom house, it doesn't leave much scope for saving. At least the energy costs tend to be low there, which will be a bigger consideration in the future with energy prices continuing to increase.

Silicon Valley is full of millionaires who are millionaires simply by virtue of having owned a home for a few years, considering the inflation in house prices there since the mid-1970s. But in real life it doesn't make any difference to anything unless you sell your house there and move to somewhere cheaper.

 

[kcowan]

... But in real life it doesn't make any difference to anything unless you sell your house there and move to somewhere cheaper.

The article was featuring people with several million in assets in addition to their houses. What you describe might apply to many people on both coasts. As long as they are prepared to give up/rebuild their current lifestyle.

 

[FinanceGeek]

To echo what Elspeth said, it is quite clear that most anybody who's owned a house on either coast for at least the last 5-10 years probably has developed a substantial net worth, at least on paper.

But as you said it means very little unless they relocate away from those areas...

As for your example of a "$1.5M 50-year-old 1500-sqft 3-bedroom house", I try hard to keep separate the difference between price and value, hence I do not live in such areas !!!

 

[Eyerishgold]

I'm guessing being a millionaire means having a net worth that looks like this $1,000,000.

Using net worth is probably the truest definition of the term millionaire. However, I'm sure most people consider being a millionaire means having $1mm in investable assets.

 

[ScottFromUtah]

I'm guessing being a millionaire means having a net worth that looks like this $1,000,000.

Using net worth is probably the truest definition of the term millionaire. However, I'm sure most people consider being a millionaire means having $1mm in investable assets.

Do you remember the old (terrible!) Fox game show called "Who Wants to Marry a Multimilionaire?" All the cute women lined up to try to be the winner, because they loved the idea of marrying rich. Turned out the guy was a homebuilder/contracter (as I recall), who had 2-3 million in assets, but most of those assets were his company. He had few liquid assets and low cash flow.

So yes, he was indeed a multimillioniare (in about the same sense that I am), but he didn't have the look and feel of a multimillionaire (and neither do I).

 

[packrat44]

It is my opinion "millionaire" has little meaning. In 50 years someone with $1M might be at the poverty level.

The goal should be FI, not $1M ($2M; $5M; (?M). The level of money needed to be FI has a wide range. A person who has worked all his/her life at minimum wages probably has a much lower requirement than an attorney, surgeon, etc. I imagine Paris Hilton could only survive a few months if she had "only $1M" (and had to pay her entire way) at her level of consumption.

LBYM; determine your real "needs" (not "wants"); then a person can project what it will take to be FI. Better add a little extra because it is the "wants" that make life fun.

 

[semtex]

For us, 1M means barebone ER. Working one it...

 

[unclemick]

I'm one of them ballpark 3 times millionaires.

Paid off 21k fish camp/beater vehicle in the LA swamp with 300k in 1993. Millionaire circa 1999, not, again after 2002, Katrina 2005, not, again around 2006. I hope the third times a charm.

I was 'rich' living large in New Orleans' eastern swamp - now I'm just so so in greater Kansas City burbs.

heh heh heh heh heh heh heh - Did find some really cool bib overalls at Salvation Army. Straw hat and a toothpick and perhaps I won't miss my Jimmy Buffett shirts in the closet.