What does it mean to be wealthy? Turns out, opinions vary wildly depending on who you ask – and where they live.
According to the latest Modern Wealth Survey from Charles Schwab, Americans believe you need a net worth of $2.5 million to officially enter "wealthy" territory. That might sound like Monopoly money to some. Still, others in high-cost cities like San Francisco scoff at the number, with Bay Area residents suggesting you need closer to $4.4 million to feel comfortable. And then there are those on Reddit who've weighed in with their takes.
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One user on Reddit called the $2.5 million benchmark "shockingly low," declaring that "$10 million is the real starting point." Another chimed in with some math to back their point, using the popular 25x rule: essentially, you multiply your annual lifestyle costs by 25 to determine how much invested wealth you'd need to live comfortably off the interest. For example, if your ideal life costs $70,000 a year, you'd need $1.75 million invested. Prefer yachts and private jets? Well, $15 million a year in expenses means you're looking at a cool $375 million portfolio. Easy, right?
Then, there's the philosophical side of the debate. One Redditor said they knew they were "wealthy" when money couldn't solve their problems. For them, hitting $3 million was the sweet spot where they could afford the life they wanted and any extra cash became irrelevant to their happiness. Another pointed out that most Americans aren't even close to these numbers – many can't cover a $1,000 emergency without borrowing. From that lens, $2.5 million might as well be a billion.
Beyond the Reddit banter, the conversation reveals how wealth is relative, tied to hard numbers, personal values and circumstances. Historically, "modest competence" (a term famously used in Jane Austen's novels) described a level of wealth sufficient for comfort and security without extravagance. Adjusted for inflation, this concept might translate to an annual income of $100,000 –$150,000 today. Using the 25x rule means you'd need $2.5 –$3.75 million invested – not far from what Schwab's survey suggests.
A couple with $2.5 million might feel rich in rural Kansas but stretched thin in Manhattan, where housing alone can eat up half a fortune. And then there's the generational divide – Boomers think $2.8 million is the magic number, but many Millennials, facing student debt and rising living costs, might find even that unrelatable.
Ultimately, whether wealth means millions in the bank or simply the ability to live without financial stress, the key takeaway is this: financial security isn't one-size-fits-all.
Before you start measuring yourself against a survey or a Reddit thread, consider what wealth truly means. And if you're unsure how to get there, it might be worth chatting with a financial advisor who can help you map out a plan that works for your goals – whether that's yachts or just peace of mind.
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