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Your Take: How Much Income to Feel “Rich”?

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Stacks of CashA recent Gallup poll asked, among other things, respondents how much income they would need to earn a year in order to feel rich. 70% of the respondents that gave a number (10% didn’t give a number) said they would need to earn $100,000 or more with the median number being $150,000. 4% said over a million dollars and 11% said a million dollars. Compare this to 2004, the last time Gallup did a similar poll, and back then $120,000 was the median number, which happens to be $147,665.87 if you adjust for inflation (BLS CPI calculator). The median annual household income, according to the US Census, is around $50,000.

What’s interesting about this poll and the answers is that the median result didn’t change much despite everything that has happened since 2003. In 2003, we were still working out aftermath of the dot com bubble and 9/11 but the stock market was improving after hitting its lows in late 2002. Hopefully we’re going through the same today having seen the lows already. :)

Here comes the obvious question… how much income do you think you’d need to earn to feel rich?

(Photo: nowhere77)

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35 Responses to “Your Take: How Much Income to Feel “Rich”?”

  1. Brendan says:

    Numerous factors need to be considered to determine what my “number” to feel rich would be. I currently live just outside of DC. $150,000 in this area is not much at all, considering the median income in Arlington County and the surrounding areas is the highest in the country (around $110,000).

    We all define “rich” differently, as well. In my mind, it means I have the funds to live in a big house in a great school district with a yard (in this area thats Mclean, starting around $1.5 million)

    • Brendan says:

      bah! pressed submit before I was done.

      In addtion to the house, I would want to be able to take 10+ weeks of vacation a year, have a vacation house somewhere warm, and plenty of extra income for going out.

      So, my annual income to feel “rich” in DC would have to be about 1000% higher than the median, so probably around 1.5 mil a year.

      • Courtney says:

        Was going to say the same thing. We live a little farther out from DC (Loudoun County) but still not cheap. Our pre-tax household income is a little higher than the median response, and I can tell you we’re comfortable but definitely nowhere near rich.

      • cubiclegeoff says:

        I would think once you were able to do all these things, you’d stop feeling rich and want more.

        • Strebkr says:

          I have to agree here. I think its human nature to always want a little more. Think about your first job and how little you made. At the time you were probably thinking you had it all. Then life set in and you got comfortable and wanted more.

          Its not as bad as it seems wanting more pushes us to set higher goals, do more and generally want to be successful. The trick it to not want too much more.

    • Anonymous says:

      Don’t forget Great Falls!

    • A says:

      I was going to say the exact same thing. I live in DC and $150K does not get you very far when you take into consideration cost of housing (either renting or buying), cost of food, and the fact that everything in the city costs more and is harder to find than even if you live in the suburbs.

  2. Emily says:

    I agree with the above posters that the number is very dependent on where you live. In my hometown of Pittsburgh, you could live pretty well on 150K/year. Now, I am also in the DC metro area, and 150K does not go that far.

    I’d need enough money to not have to compromise on things. Right now, we’re buying a nice house, but it’s because we’re willing to commute farther. We could take that nice vacation OR buy furniture. I’d want to have enough money to do everything on my list.

    I also have to point out the differences between pre and post tax income. At these higher values, that can be quite different. I’d put my number around 300 or 400K AFTER taxes.

  3. Kyle says:

    Here in Southern California, I’d say it would take around 200K/year before taxes to feel “rich”. For example, if I won one of those Set For Like scratchers and now got 100K before taxes a year (for “free” so to speak), I’d still continue to work because I don’t think that would be enough.

    Kind of sad.

  4. Des says:

    I would be interested to see the survey results broken out by income levels. Isn’t “rich” for most people just “more than I make right now”? When I was in college, $50k sounded like more than I would ever need. Now I gross almost 3x that and don’t feel rich at all. After paying grown up things like taxes, insurance (house, flood, medical, dental, car, and life), and responsibly saving for retirement we bring home about $40k net (would be even less if we were self-employed). That is less than 1/3 our gross income. It’s plenty to live on, and if we keep it up we can feel secure in our ability to retire. I’m not complaining by any means, but it isn’t enough to feel rich with. Especially when it costs me so much in time and energy to acquire.

  5. Amy says:

    I weirdly feel rich right now; my husband’s salary is $32K and mine is $49K; we save 50% of his salary in 401(k) (he’s way behind), 15% of mine in 401(k), we fund our HSAs to about $2K a year, and we save over $15K a year in non-retirement accounts. We have a paid off 1 bedroom condo, one paid off SUV, no loans of any kind, and no credit card debt. Our basic living expenses (condo maintenance, car/home insurance, taxes, cable, power, cell phones/internet, food and gas) are around $1,000 a month.

    • A says:

      Yes but where do you live.

      • JC says:

        That’s the problem with the definition of “rich” as used in this article.

        It doesn’t matter where you live and especially how much you make! As long as you’re saving as much as Amy and her husband are they are rich. All that matters is that you are earning >> than your expenses.

        Amy and husband should be very proud to be saving 28k in retirement accounts and 15k in taxable accounts; that’s awesome!

    • Bob says:

      Way to go Amy!!! I am living similar. Only $27,000 left to pay on my house then I will also be DEBT FREE. Then my monthly expenses will drop to about $800.00 per month!!

  6. Diane says:

    $1.5 mil. With that amount of money I wouldn’t have to worry about paying for things or funding my retirement or living in an old folks home for 20 years!

  7. cubiclegeoff says:

    Rich to me would depend on what I have in the bank than what I make every year. If I have enough in the bank to do what I want, when I want to, then I’d be rich (I imagine that would be somewhere around $10m). If it was salary wise, it’d be take home in the $400,000-500,000 range I think.

    • LouisC says:

      Exactly…a lot of people who make six figure incomes know nothing about saving and money management. I would not consider any of them to be rich. Conversely I have known people making modest incomes but have done so well saving and investing, I consider them rich.

      People who manage their money well generally do not take on the trappings of wealth. You’ve heard about Warren Buffet’s personal spending habits, right?

    • VR says:

      I live in NYC and I’d have to go with the same numbers.

  8. Dawn King says:

    I think double what we make now would make me feel rich. We currently make about 105,000 per year between the two of us. BUT we have 7 kids so we do not have a lot extra left over since there are 9 of us living off that amount in NJ where the cost of living is pretty high. We do not live extravagantly, but shop at thrift stores for clothing and carefully shop for groceries. We also give generously to our church and other charities.

    If we made double, I would have enough to save more for emergencies and retirement which is a goal for us.

  9. elloo says:

    I make almost $100k, and I don’t feel rich at all. $500k would do it.

  10. Kenny says:

    I feel that the question is very inappropriate and will always result in answers that are WAY OUT OF WHACK, which is exactly what happened.

    We know the Gallup Poll results. Now, lets see what people do earn from the IRS. Reality of what they earn, and what would make them feel rich (regardless of where they live) has a 1000% delta.

    1. Average income in 2009 fell to $54,283, down $3,516, or 6.1 percent in real terms compared with 2008.
    2. Average wages fell, too, sliding $1,106 to $48,917 from $50,023 in 2007.
    3. Average income in 2009 was at its lowest level since 1997 when it was $54,265 in 2009 dollars, just $18 less than in 2009
    4. No income tax was paid by 1,470 of the 235,413 taxpayers earning $1 million or more in 2009, compared with the 959 taxpayers with million-dollar-plus incomes who paid no income taxes in 2007.

    Bottomline, there are very few who earn $1m or more per year, and therefore, having this poll say ‘what income level makes you feel rich will give you big round numbers’ and affect the median/average in a huge way.

    It is the same question that polls ask about how much net worth do you need to feel secure, and you get the $2M and $10M number (seen it in the Money polls).

    Finally, a long time ago, someone taught me well, that:

    “IT IS NOT WHAT YOUR MAKES THAT COUNT, IT IS WHAT YOU KEEP THAT COUNTS”

    I took this seriously to heart (fortunately when I was in my 20′s), and today things are lovely (thanks to God for aligning things for me and my family).

    No debt; High tax bracket income; Good net worth; Lots of investments; Real estate; Commodities (physical form) etc.

    I am sharing all this to let you know that forgetting the principal of ‘What income makes you feel rich’ and focusing on ‘what you save from the BEST you can do’ will get you a lot farther (like the turtle) than anything else.

    Kudos to Amy who is doing it, and she IS and WILL be way ahead of many earning 200% of her income levels. She already is a millionaire in my mind, since I started at age 23 with a $18,000 income also!!!!!!

    Hope you take the above message the right way and learn from it, as I did from someone else.

    Kenny

  11. Jeff Crews says:

    Do you think the current job market and the lack of jobs for college graduates could have an effect on this?

  12. govenar says:

    $0 yearly income (or maybe a negative amount), since if I was rich I wouldn’t need to bother working.

    • daenyll says:

      i think you’d mean $0 wages, I’d hope if I was rich enough I could live off of interest income and not worry about working

      • govenar says:

        Yeah, in practice I’d probably be getting a bunch of interest income. But ideally I’d have enough money to spend as much as I want without worrying about keeping some to earn interest.

  13. Shirley says:

    I think I feel rich right now and we are retired. We certainly would not be considered ‘rich’ by any standards other than our own, but we have everything we need, don’t have any outstanding debt, save at least 6k each year and are completely satisfied with our lives.

    We both worked many years at moderate salaries and lived a reasonably frugal life while raising five children. I can’t think of anything that either of us wants that we don’t already have. So at $3,500 per month (pre-earned), I “feel” rich.

  14. To me, rich is less about a dollar amount and more about financial freedom. So, I would need to have enough to feel like I had the freedom to buy what I want when I want. Of course, as with many “rich” people, once you begin spending to the level of your means, then you lose some of that freedom, unless you are making so much that money is not an issue. Sounds complicated!

  15. billsnider says:

    How about the economic situation and political climate? If things are very unsettled, you would need more income to feel rich, etc.

    Bill Snider

  16. joyce says:

    Yes, to some degree, “feeling rich” depends on where you live. At 57, and having lived a little while, I believe it is more how you live. Living in Massachusetts is somewhat expensive in many areas;however, over the years, I have witnessed many family members and friends who made very good money live beyond their means. They do not feel rich, but could feel rich if they saved some money and didn’t buy everything they and their children wanted. They have lived in excess…purchasing expensive cars…never paying them off and purchasing another expensive car, taking more than 2 vacations a year etc., eating out alot, etc… On the other hand, a few family members and friends have made the same or less than some mentioned earlier and I know they, like myself, feel rich. We buy a nice car and keep it until it “rolls over” haha, we do cook most meals, we provide for our children and they do get “some” of their wants, our children worked when they became of age to do so, we did take vacations if the cash was saved, nothing on a charge unless you could pay it off in full etc…If any of you are young, “feeling rich” is different for everyone. I always told my sons…we’re comfortable. Live below your means…if you do this for the first 10 years of your working life…you will be comfortable and probably feel rich…and, please know “feeling rich is nice”, but being loved and healthy is important too!

  17. Strebkr says:

    To me Rich is having “a lot” of money. Being wealthy is having enough money that you can live off the interest and never have to touch the principal. That is when you are truly free.

  18. lostAnnfound says:

    I think I would feel rich at my present level of income if we were debt-free. Financial freedom, to me, is the key.

  19. Ryan says:

    I think the two most important factors are where you live and how much debt you have.

    If cost of living is cheap and you have no debt, $100k goes a LONG way.

  20. freeby50 says:

    I think most peoples answer for this is going be some multiple of what they currently make.

    If you currently make $25k then making $75k might seem ‘rich’.

    If you make $75k then you probably don’t feel rich but you might think that $200k would do it.

    If you make $200k then you might think that $300k would be enough to feel rich.

    And so forth…

  21. Ben says:

    “Rich” is one of the most nebulous concepts around. I appreciate the way you framed the question with the concept of “feeling.”
    To one making $500K, one making $1M is rich.
    To one making $250K, $500k is rich
    to one making $100k, $250k is rich
    to one making $50k, $100k is rich
    to those without them, those with indoor plumbing and electricity are RICH!!
    When I have dinner with my wife, my twin little girls, my little boy, and my baby boy I feel very rich! When I look at my paycheck and bank statements I feel impoverished.


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