How rich is rich?

[sinkingfeeling]

http://money.cnn.com/2010/08/09/news/economy/wealth/index.htm?source=cnn_bin&hpt=Sbin

Experts peg the figure to be somewhere around $2 million to $12 million in savings.

Of course, there are other ways of determining wealth besides just what you'll need to live well in retirement.

That appears to be how the government measures affluence. The Obama administration wants to extend tax cuts for all but the wealthiest Americans, which it defines to be those families making more than $250,000.

But that only includes about 2% of the population, according to the Census Bureau.

Kaye cautions not to confuse wealth with income. Some people can make a million a year, but be spending a million and a half. They are not rich, said Kaye.

"Income relates to lifestyle," he said. "Wealth relates to balance sheets."

[zorahopkins]

1. Income Greater Than $75,000 per year

ANYONE who has income greater than $75,000 IS rich.

The OP contains this ridiculous statement: " Some people can make a million a year, but be spending a million and a half. They are not rich, said Kaye."

If someone is making -- AND SPENDING -- one million dollars in ONE YEAR, then that person IS rich!

[slackmaster]

Er, that depends entirely on where a person lives and what kind of expenses he or she has

I live in Southern California, and probably spend more on eye care than some people do on food.

[JustABozoOnThisBus]

31. Spend on eye care? How's that "hopey, changey" stuff working?

If we could have elected a liberal president and congress, maybe single-payer would have been on the table.

We blew an opportunity. Damn.

Apologies for sorta quoting the "gone rogue" person.

:hi:

[Marr]

4. Are you kidding?

$75k is nowhere close to "rich"-- and I'd actually agree with the statement you label ridiculous. If you are in debt, and completely dependent upon a paycheck-- no matter the size of that paycheck-- you are not wealthy. Wealth is about assets, not the number of chits you're doled out from your employer.

I'm not sure where I'd begin the definition of "wealthy", but it certainly isn't a number printed on a paycheck. The truly wealthy don't "work" at all. Their money simply reproduces.

[Warren Stupidity]

5. 75K is ludicrously low.

If you seriously think that income level is rich you are quite mistaken and have no clear idea how rich the actual rich are. Besides that the question was savings, not income.

Regarding that - if you have to work for a living, if you cannot live an upper middle class lifestyle off the interest from your savings, you are not rich at all, you are just another working stiff. I peg that at 100 - 150,000 in interest per year from your savings.

[zorahopkins]

9. I Said "Income" -- Not "Wages"

I made no mention of being a working stiff.

I did say, though, that anyone who has an income (regardless of how that income comes to them) in excess of $75,000 is rich.

Ask someone who is out of work whether they think someone who has an annual income of $75,000 is rich or not.

Ask someone who picks lettuce or who cleans hotel rooms or who does yard work if they think $75,000 in income means that the person is rich.

[Warren Stupidity]

22. "Experts peg the figure to be somewhere around $2 million to $12 million in savings."

The OP was framed in terms of savings. But then again, I continue to insist that if your savings alone cannot provide you with a comfortable upper middle class living - if you have to work to live comfortably - you are in no sense 'rich' regardless of what somebody even worse off than you might think.

The actual rich are free from all of the economic insecurity that the rest of us experience. If you do not understand that then you are just an easy mark for the endless efforts of the actual rich, the plutocrats who run this country and most of the world, to pit us peasants one against the other.

[hfojvt]

37. the experts seems like they are full of crap too

like more than 1% of the population has more than $500,000 in savings. But why should people in the top 1% be considered rich? :crazy: Apparently the "middle" of middle class goes all the way from the 10th percentile to the 97th in the eyes of some people (who are probably in the over 80 percentile group.

[slackmaster]

38. What about someone who has $75K in income, and $50K in medical expenses

Is that person rich in your eyes?

[Gaedel]

39. OK, with CD's going for 1%

To make $100K a year in interest, you would need $10M in assets.

Wealthy is having greater than $10M in the bank.

[Statistical]

43. Nobody rich has money in CDs.

FDIC insurance is only $250K thus a bank CD is very risk thing to hold.

A diversified portfoilio of treasuries (4% on 30 yr), investment grade corporate bonds (5% - 7%) and equities (average return of 9.4% over last 30 years) can return far more than 1% with very little risk.

[taught_me_patience]

6. $75k is not rich anywhere in the country

and is lower-middle class in cities like Los Angeles.

[zorahopkins]

10. "Middle Class"?

I would venture to guess that the people who clean hotel rooms in Los Angeles might think that having $75,000 in annual income would mean that they were rich.

[maxsolomon]

17. absurd argument

ask an starving street orphan in bangladesh and he'll think hotel-room cleaners in LA are rich.

"rich" means you don't have to worry about money - as in, you could live off your investments and interest. in 08, i made 75k. i worried about money.

[DJ13]

20. +1

[DesertFlower]

26. or new york city. nt

[Freddie Stubbs]

13. Great! That means that there are a lot of rich people in this country

[slackmaster]

19. This is what worries me when I hear calls to "Tax the rich"

My AGI is about $75,000, and I think I pay more than my fair share of taxes already.

[Freddie Stubbs]

23. You are just one of those greedy, selfish, rich persons who doesn't want to pay their fair share

;)

[FBaggins]

28. Just highlights the perception problem.

To a large number of people, "rich" is defined as "more than I make and more than I expect to make in near future" -

A claim that $75,000 makes you "rich" is just ridiculous. In some parts of the country you're lucky if you're middle class at that level. Who knew there were so many rich policemen and teachers?

Heck... what wonderful news. Almost 30% of the households in the country are now rich! Recession? What recession? :)

[Warren Stupidity]

24. no shit

and we have this massively stupid argument every other week. "You're a filthy rich peasant!!!!" "No, really HE'S a filthy rich peasant!!!!" and meanwhile the global elites are jetting from one castle to another piling up even greater mountains of wealth.

[walldude]

32. LOL...

"Listen. Strange women lying in ponds distributing swords is no basis for a system of government. Supreme executive power derives from a mandate from the masses, not from some farcical aquatic ceremony."

[DesertFlower]

25. that's a stupid statement.

hubby and i make more than 2x that amount and we're not rich. we're comfortable.

[Statistical]

33. "ANYONE who has income greater than $75,000 IS rich." That is funny.

Hardly but continue on with your delusions.

:rofl: <- Actual photograph of me unable to get off the floor with laughter (yeah I know I need to lose weight I don't need to hear any jokes about how I look like a smiley).

You are aware of things like cost of living right? i.e $75K might purchase a nice lifestyle (still hardly "rich") in Alamba but try living on $75K in downtown San Francisco.

Also even if cost of living was flat there are things like household size. $75K on a household of one is a lot different than $75K supporting a household of 6. Lastly you got things like caring for elderly, disabled, or very sick child. One can make $75K and live very poorly if he/she is racking up $80K a year in medical care trying to save their child from cancer.

"$75K is rich" = stupidity. Meanwhile the guys with billions (not millions or even hundreds of millions) are laughing all the way to the bank as the two peasants argue that one is richer than the other.

[zorahopkins]

36. "Try Living on $75k in Downtown San Francisco"

I hope we can agree that some places are "richer" than others.

The US, for instance, is "richer" than, say, Haiti or Chad.

A person living in Haiti might wonder why, given (what to him) is the extreme "cost" of living in a rich country like the US, a person lives in the US.

Similarly, there are some people who might wonder why people would choose to live in downtown San Francisco, where the cost of living in so high that a person with an annual income of $75,000 does not count as being rich.

It's great, of course, that some people are able to (rich enough to) afford living in downtown San Francisco, but the simply fact is that MOST people in the USA are NOT rich enough to afford to live in downtown San Francisco (or in Manhattan, for that matter).

The fact that someone says, "Oh, but the cost of living is so much higher in downtown San Francisco (or in Manhattan)" merely means that the people who can afford to live there are, in fact, rich.

[Statistical]

42. Wages are generally comparable to cost of living.

I took a 15% paycut moving to Southside VA from Washington DC however due to lower cost of living I have a higher standard of living (more disposable income, larger house, actually own some land, etc).

http://swz.salary.com/costoflivingwizard/layoutscripts/coll_start.asp
$70K in San Fransisco is comparable to $45K in VA. Is $45K now rich?
Is so $45K in VA is comparable to $37K in West Virginia so is $37K rich?

"that MOST people in the USA are NOT rich enough to afford to live in downtown San Francisco"
If they had a job in downtown San Francisco they likely would see a pay raise in nominal terms but that doesn't mean they would be any "richer". Only thing that matters is purchasing power of wages and $75K in wages in San Fransico is comparable to only about $45K in Hampton Roads VA.

If I gave you a 50% pay raise tomorrow but doubled the cost of all your bills are you richer or poorer?

So if $75K in San Francisco is rich ..... is $45K in VA also rich?
What about $45K in a household of 5? What about $45K in a household of 5 with a sick child?

[JoePhilly]

45. You have the relationship backwards ....

Let's imagine you make 75K a year ... you claim that person is rich.

Well ... perhaps they are a 20 year old with 130k in debt from college, and no other assets ... the 75k job is there reward.

It will take them years to pay off the loan.

Now ... let's imagine that you make 75k a year, but you have 5 million in assets in other investments that were passed down to you from daddy. You might be the CEO of a medium sized company ... if you are ... you are probably DEFERRING salary ... because you don't need it. And your investment "income" is taxed at a far lower rate than "actual income" from working.

One of these people is RICH, the other is not.

The focus on INCOME as a determination of RICHNESS is a TRICK that the super rich use to confuse people who are not rich.

Consider that at this time, Dick Cheney probably draws little or no salary. Lots of RICH people has no salary.

The determination of RICH is more appropriately made based on WEALTH, not INCOME.

[proteus_lives]

49. That's false.

I know families who pull in a combined 75-80k a year. With a house and three kids, that ain't rich.

[Warren Stupidity]

2. 10M

or around there. That would be enough to live quite comfortably approximately forever on the interest from t-bills paying out 1.5% (150,000/yr) per year.

[taught_me_patience]

3. I would like 3-5MM in retirement to feel completely secure

and $350k/year in income to feel "rich".

[DesertFlower]

27. i agree. nt

[Hannah Bell]

7. bush tax cuts on the top 1% alone = $1 trillion in lost revenue over 10 years.

the top 1% has 23% of the income. the top 5% does 1/3 of consumer spending. the bottom 50% has only 13% of the income.

i don't care what that apologist says, if you have income of $1 million/year, you're rich.

if you're spending $1.5 million, that's your own goddamn fault; no one gives breaks to the guy making $50K & spending $75K -- he's reviled as a profligate.

fuck these apologists for the robber baron class to hell.

[AnArmyVeteran]

8. Hi Hannah, I believe you meant 'billion', in your heading.

That would mean the rich have received $5.4 TRILLION in tax cuts since they were given huge tax breaks. And with $5.4 trillion that could have hired 154,285,714 million people at $35,000 a year, or $77,143 million people at $70,000 a year.

Hard working Americans built this country, the rich didn't. It's past time for us to have our part of the pie.

[Hannah Bell]

11. yeah, i realized million was wrong after i posted.

[AnArmyVeteran]

12. 154,285,714 million people at $35,000 a year from their tax cuts!

And with $5.4 trillion that could have hired 154,285,714 million people at $35,000 a year, or $77,143 million people at $70,000 a year.

Or unemployment would be at zero!

[Warpy]

14. That trillion might be conservative

Consider, please how high the national debt shot up in 8 years of Stupid with his wars of corporate convenience kept off the books.

That debt came from his reckless tax cuts, certainly not from increased spending on infrastructure or social programs.

Tax cuts lavished on the wealthy and corporate are a disaster, no matter how you look at them.

[Hannah Bell]

18. yes, that's a number based on the first 10 years of bush tax cuts.

the next 10 years would probably be more, because the first couple of bush years gave the majority of breaks to the "little people," & then the *real* breaks started to kick in -- dwarfing anything the peons got by magnitudes.

[AnArmyVeteran]

16. It's crazy to believe someone making a million can't make it.

If they have no restraint on their spending then they don't deserve the money they have. I agree with you. If a person making a million a year spends more than that they are incompetent to even handle money. And if they are so stupid then how did they manage to get all of that money in the first place? I believe we should go back to the good old days when tax for the rich was at almost 90 percent!

[valerief]

15. Rich means never having to worry about nice housing or medical bills. nt

[TygrBright]

21. Simple answer: "More money than I have." n/t

[TheKentuckian]

44. Everyone's preferred tax rate is significantly less than whatever it is at the moment

and if at all possible someone else should pick up the check in it's entirety.

I do agree that some accounting for cost of living needs to be done with everything done on the Federal level to increase fairness and to more effectively disperse money for various programs.

[hobbit709]

29. If they're making $1 mill and spending $1.5mill their problem is NOT lack of money.

[Statistical]

35. Agreed but they aren't wealthy

They simply have too high of an income and too little common sense.

[RaleighNCDUer]

30. Making a million a year, and spending a million and a half

just proves rich people can be stupid.

[Scuba]

34. Don't confuse wealth with income....

...because some people may only make a few million this year, but be worth hundreds of billions.

[JoePhilly]

46. Accumulated Wealth makes one rich, not income, per se.

Here's another perspective ... if you could go 5 years and not work while living comfortably off your investments ... you are rich.

[Odin2005]

40. "Rich" means you're investments make your money for you.

[JoePhilly]

47. Bingo

If you have investments that cover your expenses, you are rich. Income is not the correct yard stick.

[jannyk]

52. We're living off our 'investments' ....

....in a 40ft Trailer on a small lot we own. Just had to raise our Medical Insurance deductible to $10,000 each and 40% copay because we can't afford the increased premiums on our old policy (that only had a $5k deductible!)

We live off the income from a small four-plex we bought in the 80's and our ravaged 401k's. We even have 'assets' of over a million, including the apartment building - but couldn't give it away right now. Our tenants too are 'strapped' and I'm half carrying one of them. As far as income goes we are not far above 'fuck all'.

Yet by your definition, we are to be considered 'rich'?

Try again......

[Redstone]

41. Uh, a few years ago, I would have been considered to be rich, before my

medical problems nailed me.

I was, purely by virtue of being VERY good at what I do, and having a reputation in a specific industry for not only technical and market knowledge and what to do with it, but also for unrelenting honesty, financially successful beyond anything I'd ever imagined.

Many, many people here would have considered me to be rich, and may have been resentful thereof.

But this is American, isn't it? Aren't you SUPPOSED to do well by being smart and hard-working?

But remember this, people: At the same time I reaped the rewards, I also took ALL the risk. No sick days, no sick leave, no "safety net."

So when those operations left me with crippling newve damage and chronic pain, all the good times went away. Not that I'm complaining - I, after all, CHOSE to take the risks.

My point, I think, is this: do not ever be jealous of someone you see who seems to have the world by the ass. They're probably in that position because they WORKED for it. And they, for the most part, are the ones who have to live with the consequences if things don't work out, whether through our fault or not.

Judge not, lest ye be judged.

Redstone

[DailyGrind51]

48. Everyone who earns more than I do!

[Rex]

50. I would say to be rich in America is to have over 100 million dollars

and that is just for starters.

[DonCoquixote]

51. How about

If the expenses you are FORCED to pay to provide basic needs ensure a hand to mouth existence with little ability to save, you are not rich.

For example, I was born in New Jersey, but I know I could not afford to live there, especially on Social Security. On the other hand, there are times I have considered doing what some of my relatives have done, and move to Mexico or the Dominican Republic. There, if you invest right, that same pittance you make in America gives you a house and servants (if you so wish). It all depends on how much money it actually cost to buy your house, meds, and food. When all those Tech Jobs got moved to India, many of those Ten dollar a day people were jumping for joy, because they could comfortably afford to feed their families and pay the rent, with extra money left to save.

Perhaps another question is in worth asking: WHY is it that in a large portion of this country, the cost of living too expensive even to the natives? Allow me to give an example:part of the reason Florida is such a mess is because the local good old boys jacked the rents up to take advantage of all the Yankees (myself included) moving down. Of course, compared to the fact that our houses back home were astronomical, those rents sounded like they were dirt cheap. Many people in Florida wondered why the literal shotgun shack that sold for 20k Ten years ago now sold for 200k.

Keep in mind, when I say "shotgun shack" I mean it literally, as Florida is famous for having the house that the Academics and Architects gave that name to. We are talking small houses built by companies for working class types, barely more than glorified slave cabins, because they were largely BASED ON slave cabins. No surprise, the other place this architectural type was popular was New Orleans; so those small houses in the Lower Ninth ward, the ones with the people on rooftops, that is the "shotgun shack." No, why the amateur architecture lesson?; because right now, in Florida, developer bought a lot of these shacks, divided them up, all sell the apartments for 250-500K each! Yes, you heard me right, in Florida, number one foreclosure in the nation, the place where 600K homes are unsold, the developers sell half of a SHOTGUN SHACK as a CONDO, for anywhere from a quarter of a million dollars to a HALF a million! Gee, with this much incentive for corruption, it is no surprise that we are number one in foreclosures, namely because the actual value of a house down here has been folded, spindled and mutilated.

Can it be that, in effect, the powers that be want to ensure that no matter how much of their money has to flow through you, on the way to their other pocket, that they need to ensure that you are NEVER in a situation where you can provide security for yourself or your family, and therefore are always kept running?

[elocs]

53. Making less than $10k per year I am not rich but am content and have all I need.

I have a comfortable place to live and money enough to pay my bills and I have health care, but my general health is also very good. No, I don't have lots of "stuff" and I don't covet or need lots of stuff. Many people think they require lots of "want" stuff and confuse it with "need" stuff. They become slaves to money and to keeping and acquiring more stuff.

I am richer than billions of people on this planet. I have enough to eat and clean water to drink. In fact I have enough water to pour on my lawn. So I am way better off than many in this world as well as many in history who actually were rich.

So knock yourself out everyone, clamoring over how much is rich. I don't care.

[FBaggins]

54. So you're the "richest man in town"

in a Jimmy Stewart It's a Wonderful Life sorta way.

[elocs]

55. Yes, not in a hard cash, dollars and cents way.

I've found that too often people seem to never have enough money, never have enough stuff, and they don't appreciate the true riches that they possess.