Poll: What is your definition of wealthy as defined by Annual Withdrawal Rate?

[Koolau]

Oh, and to answer the original question of "What Is Your Definition of Wealthy" I believe it is contained in the very first post. The Kurt Vonnegut anecdote about a conversation with Joseph Heller at the billionaire's house: Wealthy = "The knowledge that I have enough." This is the definition that I have adopted and try to live by. It doesn't depend on those pesky numbers nor does it force one to compare self to others. YMMV

 

[Gumby]

Not sure what "opportunities" folks on Reddit think "we" had that they do not have now. ...

For most of those Reddit people, I would be willing to bet that if they had the choice of being the 17 year old me looking down the barrel of life in 1976 or being themselves at 17 today, with each of our respective lives and prospects, they would choose their own lives. My circumstances were grim and my prospects were dim.

 

[FLJim]

Unfortunately, once you have to take RMDs, annual withdrawal rate is not a very meaningful measure. Mine would be minuscule if not for that.

Taking RMD's is not actually part of the Withdrawal Rate unless you spend it. My RMD's leave the 401k's, and IRA's and get put into an after-tax investment account.

 

[daylatedollarshort]

For most of those Reddit people, I would be willing to bet that if they had the choice of being the 17 year old me looking down the barrel of life in 1976 or being themselves at 17 today, with each of our respective lives and prospects, they would choose their own lives. My circumstances were grim and my prospects were dim.

I think many would like to see the U.S. have higher social mobility scores that 27th in the world - Global Social Mobility Index - Wikipedia.

 

[Gumby]

I think many would like to see the U.S. have higher social mobility scores that 27th in the world - Global Social Mobility Index - Wikipedia.

So would I, but I still stand by my statement.

 

[Surewhitey]

Not sure what "opportunities" folks on Reddit think "we" had that they do not have now. I had to work summers for my books/tuition and weekends for spending money when I was in college. I lived at home and commuted. Our kids got grants and loans. We helped pay back the loans. They worked for spending money only, though they too could have worked more to cover their university costs. They also could have lived at home but chose not to.

Parents helped us get into our first home after we rented a real dump for 2 years into working at megacorp/running family business. Our kids were able to afford down payments (with our help - $10K each). I could go on. I think the methods of copping and the various obstacles change, generation to generation, but I don't buy into the "this generation" or "that generation" had it "better" or "worse" - well, maybe the generation like my parents who became adults during the Great Depression. Each generation has to learn how to play the game they are given to play. Some play pretty well and some don't. Most folks can pick a period in their life when they had it "pretty bad." First 10+ years of my life, we had nothing - nothing but just enough food, clothing and shelter. We did alright! End of rant 'cause YMMV.

You just described our daughter's life from high school, on. She's 36 & well grounded, now. Seems that everyone has something to be angry about these days. Too much 24 hr news stories of "who did what to whom" instead of "who did something good for whom". Go hug a bunny already!

 

[eytonxav]

That was exactly what I was thinking about. After 13 1/2 years ER, I've now got to start my RMD's--in what may be a down equities market. Been fortunate to have no withdrawals up until now.

I've got to move funds and pay income taxes on more than I ever made in salary. Say hello to a much higher tax bracket for 2022 and beyond. And I'll have to finally pay some state income tax too.

Too bad my new investment partner, Uncle Sam, is not such a good a steward of my funds as I've been.

Yep, most of my investment $s are in IRAs, and therefore my withdrawal rate is only coming from those before tax funds and it's the tax aspect that is painful and reason why I say the withdrawal rate is meaningless in my situation even when reinvesting the remainder after the tax bite and this situation will continue to get worse as I age.

 

[Koolau]

To get a higher social mobility score it looks like you have to move to a Socialist country. No thank you.

Looks like the folks involved in developing the algorithm have their own agendas as well. I'm sure we could all design an algorithm that makes one group look bad and another look good depending upon what metrics we chose to "massage."

We have lots of problems here but I think we have more potential to be able to deal with them. We have a 50 laboratory entity and we're free to move where ever we want to within that entity. It's not easy and it's not cheap but it is possible for those who want something different for their kids.

We paid for private schools for our kids when they were young and we moved a few miles JUST to put our kids in one of the best schools instead of a good school. Yes, that's expensive and more difficult for some than others. But what it says is that "mobility" is a choice. Naturally, it's much more difficult for some than others, but it is a choice. YMMV

 

[Theophrastus Bombastus]

In regards to how one perceives oneself as being wealthy or not, using Joe Heller's definition - I am somewhere in the middle and it has no relation to my actual net worth or investable assets. I felt 'wealthy' as a teenager 50 years ago when I could buy 6 gallons of gas for $2. Back then, the summer job I worked at paid the princely sum of $2.19/hour.

In the ensuing years, after college and other training, I worked more hours than most. I recently calculated just how many hours I worked in my lifetime - excluding all hours worked before college graduation (because of part-time/summer/winter break irregularities). By the time I retired nearly a decade ago, I had worked 125,000 hours. That is the equivalent of 62.5 years of full time work.

In my first years, I essentially worked for FREE - just to get the knowledge and experience. After that, I had no choice but to work overtime for decades, often sacrificing many things along the way. In retrospect, I enjoyed what I did for a long time, but toward the end, it was merely a grind.

I don't need or want for most things, yet I am amazed at the modern day mentality of people expecting something for nothing - as if the world owes them something - so they can have (what they perceive to be) the 'finer' things in life.

Recently the weather was inclement so I went to a high end mall to go 'window shopping.' By the end of that visit, I did not feel wealthy at all - even though my net worth was significantly higher than it was 50 years ago.

Yes, wealth is a perception and it fluctuates. I'm keeping my feet on the ground and am, for the most part, content with life. My investments are pretty much on a very conservative autopilot. I fully expect to run out of life long before I run out of money.

I wonder if the next generation will have any idea what the true cost of their inheritance really was (to paraphrase Alec Guinness' character in a 1965 movie)?

I doubt it. I'm sure that I am a member of the second generation of 'shirtsleeves to shirtsleeves' and, for now at least, I have enough.

 

[rodi]

One of my sons is dating a girl who's family is in a different category of wealth than us. My son is fortunate to have parents with a paid off house and a reasonable 529 to pay for his state university He is grateful for that as some of his friends have less. He worked for his school year spending money and is in progress of lining up a summer job for next years spending money. He started dating his girlfriend about a month into the school year. First clue that her family had more money was that she went to private school prior to college and drives a higher end german suv. (albeit older)

His girlfriend's grandmother came for a campus visit. Grandma had a personal assistant with her, and a driver. She was transitioning between 2 of her (more than 2) homes and decided to see her granddaughter (girlfriend) and my son for dinner, on her way.

Son's eyes were opened about the different levels of wealth with just this one dinner and the discussion.

 

[kgtest]

Earning more than I spend by 2x seems wealthy. At that math, I could essentially double my quality of life and would feel quite wealthy.

 

[Koolau]

One of my sons is dating a girl who's family is in a different category of wealth than us. My son is fortunate to have parents with a paid off house and a reasonable 529 to pay for his state university He is grateful for that as some of his friends have less. He worked for his school year spending money and is in progress of lining up a summer job for next years spending money. He started dating his girlfriend about a month into the school year. First clue that her family had more money was that she went to private school prior to college and drives a higher end german suv. (albeit older)

His girlfriend's grandmother came for a campus visit. Grandma had a personal assistant with her, and a driver. She was transitioning between 2 of her (more than 2) homes and decided to see her granddaughter (girlfriend) and my son for dinner, on her way.

Son's eyes were opened about the different levels of wealth with just this one dinner and the discussion.

Hmmm. Son's GF sounds like a "keeper" to me.

DW still thinks she got the same deal with me. By the time DW and I began dating, my family was solidly middle-middle class (financially). She considered her family to be lower-middle-middle class. What I think I had was "potential." DW didn't understand her own potential - which was great.

Since we were friends long before we were lovers, we had something special that transcends financial class and even potential. It's my opinion that if the families involved don't have a conflict due to "class" the kids can be more than happy together if all the other stuff works out. Money is important but secondary when it comes to love - once again, in my opinion. YMMV

 

[audreyh1]

The poll question is different from the question in the title of the thread.

Why wasn’t the title question used as the poll question? You’ll get two different groups of answers.

 

[marko]

Son's eyes were opened about the different levels of wealth with just this one dinner and the discussion.

Two quickies. One sad, one funny.

Sad: There's those who'll never "get it".
Friend of friend's son married a girl who's father owns one of the largest tire companies in the country. Despite several visits to the old man's 30 million dollar home--10 manicured acres, pool, tennis court, live-in help, the whole nine yards--mom and dad were horrified that their son would accept a job in the family business--accounting or something. "We would've preferred he worked for a real company...what kind of benefits will he get from a self employed man?" Clueless.

Funny: Back in high school I was at the house of one of my trust-funded classmates. His dad whips out one of the well known yachting magazines, points to a (at the time) mega yacht on the cover and says: "This edition came in yesterday, this is my boat!!"
I said: "Wow. Your boat is like this one?"
He proudly said: "No son, THIS is my boat. My own boat made the cover!"
'Mega yachts' have grown substantially in the past 50 years but even now it'd be quite the machine.

 

[Car-Guy]

One of my sons is dating a girl who's family is in a different category of wealth than us.



His girlfriend's grandmother came for a campus visit. Grandma had a personal assistant with her, and a driver. She was transitioning between 2 of her (more than 2) homes and decided to see her granddaughter (girlfriend) and my son for dinner, on her way.

Son's eyes were opened about the different levels of wealth with just this one dinner and the discussion.

Prenup in the works,,,,,, maybe?

 

[Sue J]

I missed this topic earlier so I just voted. Compared to many/most on this board we are not wealthy. But it sure feels wealthy to us because we have plenty for our way of life and our expenses. The cost of everything is going up and DH's retiree HRA (Health Reimbursement Arrangement) was cut by 1/3. Yet we still live within DH's pension and are able to SAVE 25% to 35% of our income every month. There is no withdrawl rate.

Our secure income (pension, HRA and SS) is more than we spend so yeah, I sure feel wealthy. Being able to still save every month is fantastic! I know our expenses will grow as we get older so saving for that rainy day feels very good.

We also upped our generosity this year. That feels like wealthy to us.

 

[Out of Steam]

For most of those Reddit people, I would be willing to bet that if they had the choice of being the 17 year old me looking down the barrel of life in 1976 or being themselves at 17 today, with each of our respective lives and prospects, they would choose their own lives. My circumstances were grim and my prospects were dim.

We're the same age within a year, and I don't think that people remember (or younger people realize) how bad the 1970s were.

Two thoughts:
1. The sort of part-time jobs that have often gone begging over the past decade were hard to get back then. Circa 1977, you had to know someone to get a job at McDonalds.

2. For years, my wife responded to '70s nostalgia with the remark that "The '70s s***ed the first time."

That said, the combination of economic losses and instability due to climate change, and the loss of status of the US as the most powerful country in the world are formidable problems for today's young people.

 

[Sunset]

We're the same age within a year, and I don't think that people remember (or younger people realize) how bad the 1970s were.

....

They also don't know:
We had to sit at home, in the kitchen with the family walking by to talk to our date on the phone, and constantly be reminded "Don't talk too long on the phone as someone might want to phone us"

Good thing, was we weren't paying $1,000 /yr to have a cell phone so we could complain about our hard life.

 

[scrabbler1]

The first time I ever felt wealthy was the day I walked into the grocery store and bought what I wanted without knowing or caring how much it cost. I was 22, and I sure had a lot less money back then.

This sounds like me, back in the good old days of 1985!

 

[scrabbler1]

Living of off dividends only with no need for SS/Pension etc.
So I say 1-2%.

We are looking probably at 7-8 Million plus.

I am with you on the first part (living off dividends only) and 1-2% WR. I ERed at 45, 13 years ago, so no SS or pension. I turn 59.5 later this year, so I can withdraw from my tIRA, but I don't need to (and it would be rather costly to do so, given added taxes and reduced ACA subsidy).

I am nowhere near $7-8 Million, but near $1.9M is plenty.