$2.27 million to feel wealthy - 3% withdrawal rate

[monte1022]

Wealthy

Let's be real. 2.27m without a pension or HC is not a lot of money. 2.27m with a decent secure pension starts to get interesting. 2.27m with a decent pension and HC provided......I would bolt immediately!

 

[ncbill]

If one has 2.2m in investments plus some SS and possibly pensions, one might not be wealthy but could be very comfortable.

Pension being the critical factor for more modest retirements.

Close relative retired in their early 50s, ~25 years ago with ~$50,000 in savings, but with a modest COLA pension & free retiree health care (they complained when they had to start paying Medicare Part B premiums)

They & their spouse have enjoyed a fine retirement so far & their investments have grown over 10x.

 

[athena53]

It's not a crime to work and earn and save and invest and improve your financial position. It's not a crime to inherit a pile from a relative you hardly knew. Nor is it a crime to pick the winning lottery ticket.

From some of the posts from my friends on FB, it's clear that "millionaire" and especially "multimillionaire" are pejoratives. Clearly anyone who got to that point lied, cheated, stole and oppressed the masses somehow.

I'm honestly considering skipping future HS reunions (several states away, so I don't get there often). I really like some of my former classmates but I feel like others would hate me if they knew what I had.

And I certainly don't feel guilty- partly very fortunate, having grown up in a functional family that valued education, having marketable skills and enjoying good health... but I did the best I could with what I had.

 

[JustCurious]

In my mind, the idea that 68K spending a year would equate to being 'wealthy' is a bit off. Not consistent with the general idea of wealthy that one sees.

I'm not saying you are wrong, I tend to agree with your view. But there is a disconnect between the financial acumen of those on this board and the Bogleheads board compared to the population at large. I suspect that if you did a poll and asked the average person "How much money would you need to be rich?" most would say if you have over a million dollars you are rich! The fact of the matter is most people people never save anywhere near a million dollars in their lifetimes, and most people don't think in terms of safe withdrawal rates (or even know what that means), and most people would not have the acumen to wisely or safely invest so much money even if they had it, or the ability to "only" spend $50,000 a year and live a modest middle class life if they have $1 million dollars sitting in a bank account itching to be spent.

I think if the average person came upon $1 million dollars they would likely spend more than 5% per year and instead live as if they were rich for a few short years until the money ran out and they would be back where they started or worse off. As evidence, read about lottery winners who blew their winnings in a few short years and ended up worse off, or professional athletes who made millions but were broke or bankrupt a few years after retiring.

 

[monte1022]

I'm not saying you are wrong, I tend to agree with you. But there is a disconnect between the financial acumen of those on this board and the Bogleheads board compared to the population at large. I suspect that if you did a poll and asked the average person "How much money would you need to be rich?" most would say if you have over a million dollars you are rich! The fact of the matter is most people just don't think in terms of safe withdrawal rates, and most people never save anywhere near a million dollars in their lifetimes, and most people would not have the acumen to wisely or safely invest so much money or the ability to "only" spend $50,000 a year if they have $1 million dollars sitting in a bank account itching to be spent.

In my general experience, if the average person had $1 million dollars they would likely spend more than 5% per year and instead live as if they were rich for a few short years until the money ran out and they would be back where they started.

In the mid 90s I remember a middle aged woman who inherited 300k cash and a farm because her brother's harley met an oak tree. At the time I was new to my profession and just starting my financial journey. I daydreamed all the way through the farm auction about how I would have invested the money instead of.............did you catch the part about the auction? 24 months to spend 300k and enter forced bankruptcy. Sad. Sharon was not one of us!

 

[street]

It would take a lot more than that at our house to feel wealthy.

So just curious, what amount would be wealthy to some of you?

I would say 2.3M is pretty nice stash and would be wealthy to 90 plus percent of the people.

 

[CardsFan]

I would say 2.3M is pretty nice stash and would be wealthy to 90 plus percent of the people.

And therein lies the problem. Don't get me wrong, $2.3 mil and SS can (and does for me) provide a comfortable retirement.

But some of the folks that think that is WEALTHY would start spending WAY more than any kind of logical WR.

It is all semantics, but to me, as others have said, wealthy implies the ability to spend with minimal regard to how much.

OTOH, We will likely leave some serious money on the table for DS.

 

[HI Bill]

From a Yahoo! fianance article this week: The article was talking about having $1.6M and spending 3%, or $48K per year. The commenter said "What? I thought if you saved $1.6M, the idea was to spend it!". To those folks, anything over a million is enormous, and just like happens with most lottery winners, it would be gone in a heartbeat!

 

[RobbieB]

According to this 2.3 million of net worth puts you in the top 95%.

Yeah, that's pretty rich!

 

[W2R]

Just another fluff piece, but this year's survey says it takes $2.27 million to feel wealthy. [...]

That number is way too high!

I guess it's all in how you define "wealthy". To me, it's being able to afford everything you want, and also every experience that you want.

In my world there are plenty of people who are perfectly content despite having far, far less than $2.27 million in their investment portfolio.

 

[street]

RobbieB >> that is what I kind of think also. There most definitely the wealthy of the wealthy but those are in a league of their own. Not to start any fighting or to argue with anyone just a serious question for me.

 

[Car-Guy]

So just curious, what amount would be wealthy to some of you?

I would say 2.3M is pretty nice stash and would be wealthy to 90 plus percent of the people.

A few more million wouldn't be enough to change my lifestyle at all. Now a NW of 25m+ would take me to the next level (from my POV) and I could make some changes.

 

[meekie]

I'm getting really close to that number, but it's still a ways from our retirement number, since we live in San Diego and have a pretty high cost of living.

I don't feel like we're in the top 5%, but I do feel pretty comfortable.

 

[HadEnuff]

I don't feel wealthy, but I feel very fortunate. With a 3% WR, and my and DW's SS, I can pretty much do anything I want to do. But there is a lot of expensive stuff I neither want, nor need, so I don't feel "wealthy"... Although I really wanted that Honus Wagner baseball card that just sold for a cool $1.2 Million...I wanted it badly.

 

[aja8888]

What is it about CNN that compels them to festoon their articles with sanctimonious irritants?


What a crock. "Feeling guilty"? The only people who should "feel guilty" are people who actually ARE guilty of something.

It's not a crime to work and earn and save and invest and improve your financial position. It's not a crime to inherit a pile from a relative you hardly knew. Nor is it a crime to pick the winning lottery ticket.

It's not even a crime to stumble into undeserved celebrity riches via reality cable shows (although maybe it should be).

Nobody should "feel guilty" except criminals... and CNN, for their relentless blame-mongering.

I feel better now.

What's CNN?

 

[W2R]

I don't feel wealthy, but I feel very fortunate. With a 3% WR, and my and DW's SS, I can pretty much do anything I want to do. But there is a lot of expensive stuff I neither want, nor need, so I don't feel "wealthy"... Although I really wanted that Honus Wagner baseball card that just sold for a cool $1.2 Million...I wanted it badly.

Here you go! Buy this on Amazon for $12.99, and save $1,199,987.01.

The big advantage of doing this is that you can frame it and put it in your living room to stare at to your heart's content, for hours every day if desired. The expensive one you'd have to keep in a safety deposit box or something and you'd never get to see it. You'd need separate insurance for it too. What a hassle.

 

[ElizabethT]

We have more than double the amount of investments and cash listed in OP, and yet definitely do not feel wealthy. I think we'd both say we feel comfortable, but not wealthy. Which might be precisely why we are where we are, financially? A psychological mindset that skews reality to a degree that we accumulate assets without thinking about what economic bar we're now at?

Then there's that we live in an area where we're surrounded by other 'comfortable'-appearing folk, so we're not standouts in any way, and thus don't think of ourselves as wealthy. Kind of the opposite, actually, considering that we're surrounded by gated communities, slipped boats, and luxury autos while living in an ungated community, owning a travel trailer, and driving 'just' a Prius and a Grand Cherokee ourselves.

I am most markedly aware of the differences in our circumstances when I travel away from the coastal-bubble where we reside. And find myself feeling very thankful in a manner I don't when back home in our bubble.

So perhaps more than a few of us have a case of skewed perspectives.

 

[Rotaflex]

Ha funny we both thought the same word at the same time.

“Comfortable” I heard that in the Crazy Rich Asian show?

 

[street]

Here you go! Buy this on Amazon for $12.99, and save $1,199,987.01.

The big advantage of doing this is that you can frame it and put it in your living room to stare at to your heart's content, for hours every day if desired. The expensive one you'd have to keep in a safety deposit box or something and you'd never get to see it. You'd need separate insurance for it too. What a hassle.

Lol! That would work great and what a savings.

 

[ugeauxgirl]

It's all a matter of perspective I guess. I feel wealthy when I think about it at all. I'm wealthy because I don't have to work anymore if I don't want to. There isn't much that I want that I don't have. And if I really wanted it I could. My life is very full.

 

[Kook]

So true

There is always another higher bar to exceed......

First, my target was 1M
Then, when I got there it was 1.5M
Then....2M
Ditto 2.5 M
The goalposts keep changing.
Perhaps time to kick the field goal?!

 

[NW-Bound]

I don't feel wealthy, but I feel very fortunate. With a 3% WR, and my and DW's SS, I can pretty much do anything I want to do. But there is a lot of expensive stuff I neither want, nor need, so I don't feel "wealthy"... Although I really wanted that Honus Wagner baseball card that just sold for a cool $1.2 Million...I wanted it badly.

Here you go! Buy this on Amazon for $12.99, and save $1,199,987.01.

The big advantage of doing this is that you can frame it and put it in your living room to stare at to your heart's content, for hours every day if desired. The expensive one you'd have to keep in a safety deposit box or something and you'd never get to see it. You'd need separate insurance for it too. What a hassle.

$12.99 for a reprint? That's too much. I am not a sports fan, so the card does not do anything for me.

Can you just download the picture and print it out on your printer? I just look at it on my laptop screen, and it's enough. Don't have a working color printer on hand anyway.

 

[unclemick]

+1

The more you have, the more it takes to feel wealthy.

Investing from 1966 - 2019 I always found portfolio's which outperformed mine - pick your time frame.

Full Auto since 2006 with Vanguard Target Retirement I don't/er try not to look as much.

heh heh heh - without expounding too much - male hormones have some role here - that's my theory and I do look more during football season.

 

[daylatedollarshort]

We live in an area that has gotten more expensive over they years, but I grew up blue collar and kept those spending habits. It is not only what you have in assets and income that determine lifestyle but also optimizing spending and in our case some dumb luck. If we had bought a house in our neighborhood more recently, didn't retire when ACA subsidies were in effect, didn't have a low Prop 13 tax base, hadn't gotten financial aid for college for our kids, shopped locally instead of ethnic markets and outlet stores, didn't have our seat filler memberships, etc. we would have needed to spend easily $2M more in retirement / lifetime spending for the same lifestyle.

I feel wealthy even though we're around some households with very high net worth these days because I still remember what it is like to not have money to fix a beater car to be able to get to a minimum wage job.

 

[ugeauxgirl]

First, my target was 1M
Then, when I got there it was 1.5M
Then....2M
Ditto 2.5 M
The goalposts keep changing.
Perhaps time to kick the field goal?!

Yes, my DH kept raising the target as we kept passing them. He'd feel comfortable with just a little more- only there's no end to that.