$5m is the new $1m

[tryan]

Always thought anybody with with more $$ than me was "rich" ... but $5m ??

Enjoy.

Why $5 million is the new $1 million - Personal Finance - MSNBC.com

 

[VaCollector]

If I truly believed what this article is trying to say....I should be headed back to "the salt mines" tomorrow morning!!

....only part I DO agree with is that anybody with $5M IS RICH!!

 

[Sam]

Yeah, this is getting old. It's like "how much is a million?" question. Or "What's a millionaire?"

These guys basically run out of subjects to write about. Why 5=1? Why not 2=1? 10=1? ... Pick any ratio, and someone will find an argument for or against it.

 

[Spanky]

The simple answer is to date back the time at which the term "millionaire" was coin to symbolize wealth and normalize the value.

 

[Coach]

That's interesting -- in the early 70's, when I started fantasizing about being financially independent, my number was $1M. I bet the CPI is about 5X now what is was then.

But $1M still is still my number -- I just don't want to wait, and it's enough.

Coach

 

[Bikerdude]

A man who makes a million dollars is as well off as if he were rich.

John Jacob Astor (early 1900's)

 

[Nords]

Always thought anybody with with more $$ than me was "rich" ... but $5m ??

Yeah, this is getting old. It's like "how much is a million?" question. Or "What's a millionaire?"
These guys basically run out of subjects to write about. Why 5=1? Why not 2=1? 10=1? ... Pick any ratio, and someone will find an argument for or against it.

Enjoyable article, but I noticed that they're finding it difficult to interview actual pentamillionaires-- let alone pentamillionaires who aren't still working in one way or another.

The simple answer is to date back the time at which the term "millionaire" was coin to symbolize wealth and normalize the value.

Well, ironically we'd have to go back to one of the first bubble boys-- John Law ("First Duke of Arkansas", way before Bo & Luke) enabled the creation of French citizens with net worths of a million livres back around 1719.

Now all we need is a good 200-year currency converter & CPI calculator...
John Law (economist) - Wikipedia, the free encyclopedia
How John Law's Failed Experiment Gave Us a New Word: 'Millionaire' [Free Republic]

 

[ladelfina]

eH... Inflation happens. When I was a sprat milk was $1-something a gallon, too.

Site that compares hist. prices in one community (White Plains, NY); I'm not from White Plains, just to clarify.. jes' happened to come across it.
Library History

1969:
Average Income: $9,433
Average Cost of:
3 Bedroom Home: $25,600
New Ford: $3,278
1 Gallon Gas: 35¢
1 Pound Bread: 23¢
1 Gallon Milk: $1.35

Note how super-cheap the gas compared to bread/milk.


1989:
Average Income: $27,225
Average Cost of:
Three Bedroom Home: $120,000
New Car: $15,403
1 Pound Bread: 69¢
1 Gallon Gas: 97¢
1 Gallon Milk: $2.62

Still, note how super-cheap the gas compared to bread/milk.

Too bad they haven't kept up the figures at this site... but I guess you can find similar #s elsewhere.

Not that hard to imagine that the concept of "millionaires" we (ok, I) grew up with in the 60s->70s would be "pentamillionaires" today..

 

[CybrMike]

Sometimes even $5 million doesn't seem enough.

 

[playaman]

I've long thought $5 million was the threshold of being "rich." Doubt that I'll ever experience it, though many obviously are.

 

[Spanky]

Sometimes even $5 million doesn't seem enough.

What is enough for one person may not be adequate for someone else because of the difference in needs and personal preferences. The income threshold for basic needs and decent standard of living varies significantly among individuals. An amount of five million dollars is definitely insufficient if your standard of living requires a dollar figure in the billions.

 

[Bigritchie]

I sometimes wonder if all these articles from the mainstream media and investment houses, ala Look Bob loves to work and is working to 100, and 1 million isn't enough, is #1 to keep the Baby generation from calling it quits even earlier, jerking all their cash out of the market and living on CD's.

No thanks for me, I would rather enjoy life then worship Mammon.

 

[chinaco]

IMO - There is a difference between financially independent and being wealthy. $5mm is not super wealthy. But it might be a lower threshold where one is above what would be considered upper middle class... in terms of money.

 

[kumquat]

That's interesting -- in the early 70's, when I started fantasizing about being financially independent, my number was $1M.

Coach

Mine was $12K/yr to be comfortable. Now pay a lot more than that in income tax and am only comfortable.

 

[Miss_Lala]

Since the allowed age for withdrawals from my retirement accounts is still 35 years away, I think I may need to up my goal from $5M! It seemed like such a lofty and impressive number....

 

[Texas Proud]

Since the allowed age for withdrawals from my retirement accounts is still 35 years away, I think I may need to up my goal from $5M! It seemed like such a lofty and impressive number....

Sorry to say, but you are right... $5 mill is probably your number... but guess what?? You make more than we did when we were you age... I was just looking at my SS statement and there were many years when my earnings were in the $40K range... Now it seems that people are graduating from college with jobs in the $80s or even $100s...

 

[Sandy]

I was just looking at my SS statement and there were many years when my earnings were in the $40K range...

When I look at my SS statements, I had j*bs with pay in the $40K range - wait that was only 5 years ago. Most years were much much lower.

$1m still looks pretty nice to me.

 

[Miss_Lala]

Sorry to say, but you are right... $5 mill is probably your number... but guess what?? You make more than we did when we were you age... I was just looking at my SS statement and there were many years when my earnings were in the $40K range... Now it seems that people are graduating from college with jobs in the $80s or even $100s...

Yes, those salaries are possible for people my age who graduate with a lucrative degree. Those of us with B.A.s in History don't fare so well.....

 

[Cbear1883]

With the rising cost of living, and the lengthy retirements many people must plan for, financial experts say the new benchmark for the rich is $5 million.

Note, it says new benchmark for the "RICH" is 5 Mil...I'd be happy with 1.5 mil, and my planned retirement is 25+ years away. I think it's all relative...5 mil to me would probably still seem like an absurdly high amount, though I may change my tune 25 years from now. There's no way that I could save that much regardless so it really doesn't matter. 5 mil will look different depending on who's looking...

 

[Cbear1883]

Yes, those salaries are possible for people my age who graduate with a lucrative degree. Those of us with B.A.s in History don't fare so well.....

Agreed, and those of us with no degree at all even more so, though whether to get a degree, AND what degree to pursue are individual choices that we all had to make. DH and I both skipped college and went straight to work. We're comfortable, and are saving so I think we're doing ok without the degrees.

 

[retire@40]

Right now $5 million is too high and way out of reach for most people in a lifetime, much less making it a goal for early retirement. Heck, just getting to $1 million is a struggle when you're trying for a couple of decades.

 

[citrine]

Geez....when is it going to be enough? I am amazed by the herd mentality that is portrayed by much of our society. My goal is still a million....if I have 750K and I want to call it quits....I will!
I would rather live a happy, simple life on my own terms than working like a dog because everyone else is!

 

[Texas Proud]

Yes, those salaries are possible for people my age who graduate with a lucrative degree. Those of us with B.A.s in History don't fare so well.....

yea.. you got me there.... not much demand for a History degree...

My niece just graduated from law school and will probably be the highest earner in the family in a year or two.. and I mean all aunts and uncles and cousins etc...

And then there are some engineers who also make a good amount of money for only a couple of years experience...

 

[Texas Proud]

Geez....when is it going to be enough? I am amazed by the herd mentality that is portrayed by much of our society. My goal is still a million....if I have 750K and I want to call it quits....I will!
I would rather live a happy, simple life on my own terms than working like a dog because everyone else is!

But you are looking at it from 'todays' number... my nephews and nieces that are just coming out of college will need 'more'...

In 30 years, $1 mill will not buy you much off the $40K that you can spend off it... maybe $15 to $20K today...

 

[citrine]

As long as I can buy paint supplies, food, and cat food.....what else do I need? (assuming mortgage and car is paid off)