70% Of Millionaires Don't Think They're Rich – Even Though People Are Wealthier Than Ever, They Don't Feel It

Having $1 million in the bank would make someone feel rich. But in America today, nearly 70% of millionaires don't consider themselves wealthy, according to a 2024 Northwestern Mutual research study. That's right – 70%. What's behind this surprising self-perception? It turns out that it's not just about how much money they have but how they measure up in a world where the definition of "wealthy" keeps shifting.

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Wealth Isn't What It Used to Be

A million dollars once felt like an untouchable milestone. Many millionaires say it's not enough to feel "rich." According to a Charles Schwab survey, Americans believe it takes $2.5 million in net worth to be considered wealthy – up from $2.2 million just two years ago in 2022. Even financial security feels out of reach for some, with the average person saying they'd need $778,000 just to feel comfortable.

Why? It's partly because wealth is relative. The value of a dollar depends on where you live and how much your neighbors earn. A seven-figure net worth may sound impressive, but in cities like San Francisco or New York, owning a home, covering child care and keeping up with rising living costs can be a struggle.

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This comes at a time when Americans are wealthier than ever. In fact, there are more millionaires in the U.S. today than at any point in history. Recent data shows that household net worth across the country has surpassed $160 trillion, while the number of individuals with a liquid net worth of $1 million or more has hit a record high. 

The Trap of Lifestyle Creep

Another factor is what financial planners call "lifestyle creep." As people make more money, their expenses tend to rise just as quickly. Millionaires aren't immune to this. Earning more often leads to spending more – on bigger homes, luxury cars and private schools. Eric Roberge, a certified financial planner, explains to Investopedia that it still feels tight whether they're making $50,000 or $500,000. "The expenses are still there. They're just bigger," he added.

This pattern makes it tough to feel wealthy, even when the income looks substantial. The margin between what they earn and spend can feel precariously thin for many.

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Retirement Worries Are Universal

It's easy to assume that millionaires would feel more secure about retirement and in some ways, they do. The survey found nearly 87% of high-net-worth individuals feel prepared for retirement, compared to just 54% of the general population. But that doesn't mean they're worry-free. Concerns about taxes, health care costs and outliving their savings keep even the wealthiest up at night.

The tax burden, in particular, is a major issue. With most retirement accounts taxed upon withdrawal, even millionaires worry about how much of their savings will be left after Uncle Sam takes his cut.

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Financial Discipline Over Flash

Interestingly, despite not feeling rich, millionaires tend to be more disciplined with their money than average people. About 78% of millionaires identify as "disciplined financial planners," compared to 45% of the general population. Many work closely with financial advisors, with 69% enlisting professional help versus only 33% of non-millionaires.

This focus on planning, rather than feeling wealthy highlights a key mindset among millionaires. They prioritize protecting and growing their assets over indulging in the trappings of wealth.

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The Self-Made Majority

Here's another surprising twist: most millionaires are self-made. The study found that nearly 80% of millionaires earned wealth through hard work and smart financial decisions. Only 11% inherited their money and just 6% came into it through a windfall like winning the lottery.

This self-made status contributes to their cautious mindset. They've built their fortunes, often through years of saving and investing and they're acutely aware of how easily it could all disappear.

Rethinking ‘Rich'

Next time you hear someone say, "A million dollars isn't what it used to be," know they're probably right. In today's world, being rich is about much more than the numbers in your bank account – it's about how those numbers stack up to the life you're trying to live.

If you want to feel more secure about your financial future – no matter your income – consulting a financial advisor can be a smart move to build a plan that works for you.

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