Are you wealthy? Bloomberg recently wrote, “Billionaires know they are,” and “Low-wage workers are very well aware that they aren’t.” But how about the people in between?
Charles Schwab’s 2023 Modern Wealth Survey asked 1000 people between ages 21 and 75 what it took to be wealthy in the U.S., and the average number was $2.2 million. Of course, there were geographic differences. As the table below shows, it takes a lot more to be rich in San Francisco than in Atlanta or Chicago.
But there’s a big difference between what people have and how they feel. Bloomberg writers Claire Ballentine and Charlie Wells polled 1000 people who made at least $175,000 a year, which put them in the top 10% of U.S. tax filers. Surprisingly, one-quarter of the respondents said they were “very poor,” “poor,” or “getting by but things are tight.” Most of those with $1 million to $5 million in assets called themselves “comfortable” but not rich — and some identified as “poor.”
What gives? It seems like you know a rich person when you see one, but apparently, many don’t feel so flush. More high earners than not feel “financial stress.” Many think they won’t do as well as their parents. Plus, it’s human nature to compare and want more.
Long ago, there was a wonderful article in New York Magazine that interviewed individuals at different wealth levels, and as you went up the ladder, it became clear no one was satisfied. The person who wanted a bigger apartment envied the brownstone owner. The brownstone owner complained about the cost of private school for four kids and taking the family to Broadway shows every month. The successful finance guy would ask, “How can I compete with the people with the private plane?” That person would say, “How can I keep up with my friends who don’t even have to work?”
You get the picture. It’s all about framing. We know Olympic bronze medalists feel more satisfaction than silver medalists because the silver medalist’s framing is, “Ugh. I was so close to winning gold,” while the bronze medalist’s framing is, “I almost didn’t make it onto the podium, but here I am!”
So what would the bronze medalist’s framing on wealth be? Remember when Kurt Vonnegut told fellow writer Joseph Heller at a posh party on Shelter Island that their billionaire host had made more money yesterday than Heller’s book Catch-22 ever would? Heller’s wonderful response was, “I’ve got something he can never have . . . The knowledge that I’ve got enough.” Then there’s Chinese philosopher Laozi: “He who knows that enough is enough will always have enough.”