How Rich is "Rich"?
September 3, 2004 9:12 AM Subscribe
What's the defenition of "rich"? During the convention i've heard "rich" equated with household incomes of $100K or more. That seems like an incredibly low number to me -- is it 'cause I live in New York?
Is it defined as some top percentage of the population, and it happens to be that $100K is where that percentage starts?
Don't get me wrong, I understand that it's a lot of money, but I wouldn't think a family of four with a mortage and college tuitions feels "rich". "Well off", maybe, but "rich" implies butlers and helicopters, doesn't it?
Is it defined as some top percentage of the population, and it happens to be that $100K is where that percentage starts?
Don't get me wrong, I understand that it's a lot of money, but I wouldn't think a family of four with a mortage and college tuitions feels "rich". "Well off", maybe, but "rich" implies butlers and helicopters, doesn't it?
To the other 99% of the world, I would think 100k American is pretty damn rich.
posted by trbrts at 9:38 AM on September 3, 2004
posted by trbrts at 9:38 AM on September 3, 2004
Not to introduce partisan politics into Ask MetaFilter, but I believe this is a loaded technique to make the middle class afraid of John Kerry raising taxes. I'm pretty sure Kerry calls for raising taxes on those making over $200k or $300k per year, but the republicans have been saying all along that it includes folks making all the way down to $100k.
Being that Kerry isn't in office and hasn't laid out detailed plans, I don't know how the Bush camp can say this, but they want you to be afraid of new taxes, even though it's likely it won't affect you.
There's an old study where folks were asked where they fell in the bell curve of how much everyone makes in america. Something like 20% said they were in the top 1% of income earners. Using that kind of optimism/self-delusion, it's not hard to convince people that a guy that wants to raise taxes on "the rich" to save the middle class could be construed by others to tax all those folks that make some comfortable living and think they are at the upper crust.
posted by mathowie at 9:39 AM on September 3, 2004
Being that Kerry isn't in office and hasn't laid out detailed plans, I don't know how the Bush camp can say this, but they want you to be afraid of new taxes, even though it's likely it won't affect you.
There's an old study where folks were asked where they fell in the bell curve of how much everyone makes in america. Something like 20% said they were in the top 1% of income earners. Using that kind of optimism/self-delusion, it's not hard to convince people that a guy that wants to raise taxes on "the rich" to save the middle class could be construed by others to tax all those folks that make some comfortable living and think they are at the upper crust.
posted by mathowie at 9:39 AM on September 3, 2004
BTW, $100k seems like a lot, but with two income earners, it's not unheard of to have two educated folks bringing in $50k at a job (each).
I know plenty of families making over $100k that live in small houses, have big mortgages, credit bills, and are still paying off their school loans.
posted by mathowie at 9:42 AM on September 3, 2004
I know plenty of families making over $100k that live in small houses, have big mortgages, credit bills, and are still paying off their school loans.
posted by mathowie at 9:42 AM on September 3, 2004
Yes, it's a subjective term. But if you're cleaning toilets for a living and sleeping in a shitty apartment in a crime-infested neighborhood with the rest of your large family, 100K probably seems pretty frigging rich.
But I agree with you-- "rich" conjures up greater wealth than that in my eyes.
posted by Mayor Curley at 9:43 AM on September 3, 2004
But I agree with you-- "rich" conjures up greater wealth than that in my eyes.
posted by Mayor Curley at 9:43 AM on September 3, 2004
I think of rich as being someone who doesn't depend on income necessarily, and concentrates on assets instead. Someone who can afford to live off the 5% return on their various investments.
an individual or family who has a $100K income (while pretty darn appealing to me) is certainly not 'rich'
it's assets vs. income. most of us are much too concerned about our income to worry about assets (in my opinion)
of course i would also agree with trbrts that to the vast majority of the world, $100K a year makes you pretty damn rich. it's all relative.
posted by jacobsee at 9:56 AM on September 3, 2004
an individual or family who has a $100K income (while pretty darn appealing to me) is certainly not 'rich'
it's assets vs. income. most of us are much too concerned about our income to worry about assets (in my opinion)
of course i would also agree with trbrts that to the vast majority of the world, $100K a year makes you pretty damn rich. it's all relative.
posted by jacobsee at 9:56 AM on September 3, 2004
I think some starts to become rich when she has enough passive income to live comfortably without working.
posted by zeikka at 9:56 AM on September 3, 2004
posted by zeikka at 9:56 AM on September 3, 2004
I remember reading in P.O.V. magazine (late 90s) that a survey found that $100k was the magic number for people when asked, "how much money would you need to make a year to afford the things you want?".
posted by karmaville at 10:05 AM on September 3, 2004
posted by karmaville at 10:05 AM on September 3, 2004
I think geoff has it right that rich begins when you consider buying a third car to tow your boat and you need a new truck for that purpose not a 10 year old model.
posted by Mitheral at 10:11 AM on September 3, 2004
posted by Mitheral at 10:11 AM on September 3, 2004
I actually came close to a $100K gross household income with my then-wife in 2000. Believe me, we didn't feel rich. We barely felt comfortable, but we were certainly better off than lots of other folks, even nearby. Now, if we took that income and moved to, say, Mexico or Indonesia, we'd have been rich indeed.
I have a friend who lives off investment he made during the 90s. He doesn't have a job-job. He takes classes in ironworking and the like, travels the country by van, that sort of thing. But he shares a rent-house with a couple roommates and generally lives simply. Is he rich? I wouldn't say so.
Where "rich" begins depends on your circumstances. Perhaps one way of looking at it is not how much you make, but the amount of money you can spend without really worrying about it (what that number is, I leave as an exercise for the reader).
posted by adamrice at 10:11 AM on September 3, 2004
I have a friend who lives off investment he made during the 90s. He doesn't have a job-job. He takes classes in ironworking and the like, travels the country by van, that sort of thing. But he shares a rent-house with a couple roommates and generally lives simply. Is he rich? I wouldn't say so.
Where "rich" begins depends on your circumstances. Perhaps one way of looking at it is not how much you make, but the amount of money you can spend without really worrying about it (what that number is, I leave as an exercise for the reader).
posted by adamrice at 10:11 AM on September 3, 2004
Let's not forget the other end of the spectrum in this, either. The federal government still defines "poor" in this country as an individual income of $8316, working from a formula developed in the 1950s and occasionally adjusted for inflation.
I think you wouldn't find too many people who disagree that you hit "poor" a long way before $8316/year.
I like zeikka's and jacobsee's definitions because of the relativity of the term.
posted by briank at 10:12 AM on September 3, 2004
I think you wouldn't find too many people who disagree that you hit "poor" a long way before $8316/year.
I like zeikka's and jacobsee's definitions because of the relativity of the term.
posted by briank at 10:12 AM on September 3, 2004
Man, adamrice, I wish I could be that friend. Sounds awesome.
Also depends on where you live even within the US. $100k won't go so far in La Jolla, I'm sure.
posted by kenko at 10:16 AM on September 3, 2004
Also depends on where you live even within the US. $100k won't go so far in La Jolla, I'm sure.
posted by kenko at 10:16 AM on September 3, 2004
In NY and other major cities, I don't 100k is rich. But in a lot of the country I don't see how it cannot be. I'm in the Burlington area of Vermont. A lot of jobs are in the 20-30k range. So 100k is a lot of money around here.
And I agree that it depends on your definition of rich. I don't agree that it starts when you're living off investments or that type of thing. In a consulting company I know there are people who made 200-400k a year, and then 100k and up in bonuses. That is rich in my book.
posted by evening at 11:03 AM on September 3, 2004
And I agree that it depends on your definition of rich. I don't agree that it starts when you're living off investments or that type of thing. In a consulting company I know there are people who made 200-400k a year, and then 100k and up in bonuses. That is rich in my book.
posted by evening at 11:03 AM on September 3, 2004
Very few people think of themselves as "rich". I know people who come from families with streets/universities/etc. named after them who live on the income of the income and don't think of themselves as "rich". They would say something like "financially secure" or "comfortable" or, if pressed, "higher-income".
Pretty much the only people who think of themselves as "rich" are people who started out poor and came into enormous sums of money quickly. Eminem, for instance. Or most of the people you see on MTV's "Cribs".
posted by Sidhedevil at 11:04 AM on September 3, 2004
Pretty much the only people who think of themselves as "rich" are people who started out poor and came into enormous sums of money quickly. Eminem, for instance. Or most of the people you see on MTV's "Cribs".
posted by Sidhedevil at 11:04 AM on September 3, 2004
"Rich" starts when you have enough money that your money starts working for you. That is, when you can participate in the economy as an owner of capital, rather than as a mere employee.
So, I'd say if you own some stock, you're starting to be rich. But you're not really there until, as zeikka says, your investments yield enough to cover all your expenses. And it's a long way from having a few thousand dollars in a mutual fund to making a few thousand dollars a month from money you have in a mutual fund.
posted by spacewrench at 11:06 AM on September 3, 2004
So, I'd say if you own some stock, you're starting to be rich. But you're not really there until, as zeikka says, your investments yield enough to cover all your expenses. And it's a long way from having a few thousand dollars in a mutual fund to making a few thousand dollars a month from money you have in a mutual fund.
posted by spacewrench at 11:06 AM on September 3, 2004
I remember a segment on npr about a year and a half ago where they asked people if they felt rich. The top earning couple bringing in $700k+ said they didn't feel rich.
Marketing is designed to make you feel like you really should have a better house/car/school for the kids and a bigger 401k/college fund/portfolio. If you fall under it's spell I'm unsure if it's possible to feel rich unless you reach the top 0.01%
posted by Flat Feet Pete at 11:06 AM on September 3, 2004
Marketing is designed to make you feel like you really should have a better house/car/school for the kids and a bigger 401k/college fund/portfolio. If you fall under it's spell I'm unsure if it's possible to feel rich unless you reach the top 0.01%
posted by Flat Feet Pete at 11:06 AM on September 3, 2004
What's "rich"? Top 10% of income? Top 5%? Top 1%
In 1998, a US household making $101,300 was at the 90th percentile; $132,199 was at the 95th percentile (PDF).
posted by pmurray63 at 11:20 AM on September 3, 2004
In 1998, a US household making $101,300 was at the 90th percentile; $132,199 was at the 95th percentile (PDF).
posted by pmurray63 at 11:20 AM on September 3, 2004
IMO, rich is defined by freedom of choice.
When you can choose to not work, yet live a lifestyle that you enjoy, you're rich.
Conversely, if you choose to work because work is a lifestyle that you enjoy, you're rich.
However, if you must work in order to live, or choose a lifestyle that requires you to engage in work you do not enjoy, then you are not rich.
You can be rich in a yurt in the backwoods, provided that is a lifestyle you enjoy. You can be rich in a swank neighbourhood working a fulfilling job that accomodates your lifestyle.
You can not be rich when you're a slave to work to support an overextended lifestyle, or when you work a job you despise.
posted by five fresh fish at 11:35 AM on September 3, 2004
When you can choose to not work, yet live a lifestyle that you enjoy, you're rich.
Conversely, if you choose to work because work is a lifestyle that you enjoy, you're rich.
However, if you must work in order to live, or choose a lifestyle that requires you to engage in work you do not enjoy, then you are not rich.
You can be rich in a yurt in the backwoods, provided that is a lifestyle you enjoy. You can be rich in a swank neighbourhood working a fulfilling job that accomodates your lifestyle.
You can not be rich when you're a slave to work to support an overextended lifestyle, or when you work a job you despise.
posted by five fresh fish at 11:35 AM on September 3, 2004
An aside: $100k has always been my target for "making it" and thinking I could afford everything, but I'm constantly astounded by all the $50k SUVs I see driving around. I know my neighbors aren't making much over 100k as a household (if even that much), but they're buying cars equal to 50% of their annual income, and living in a house that's only 200% of their income. Seems like a stupid way to spend your money (more money going to things that depreciate instead of appreciate).
posted by mathowie at 11:57 AM on September 3, 2004
posted by mathowie at 11:57 AM on September 3, 2004
I think 250k and up is rich. Having a second house is rich. Living in a place worth more a million is rich. Not having to go to work every day is rich-ish. ...
And my personal NYC standard--having your own washer/dryer in the apartment is definitely rich. : >
posted by amberglow at 12:39 PM on September 3, 2004
And my personal NYC standard--having your own washer/dryer in the apartment is definitely rich. : >
posted by amberglow at 12:39 PM on September 3, 2004
Very few people think of themselves as "rich". I know people who come from families with streets/universities/etc. named after them who live on the income of the income and don't think of themselves as "rich". They would say something like "financially secure" or "comfortable" or, if pressed, "higher-income".
For much more detailed investigations of such phenomena, read Class: A Guide Through the American Status System. It's been a few years, but I think the general rule is that truly "rich" or "wealthy" people tend to downplay their financial situation, as they fear that people will treat them poorly or try and exploit them because of their wealth. On the other hand, those in the upper-middle class range, or the "new money" kind of people like rappers, try to act richer than they are, in the belief that they will be treated much better for having money.
As a sidenote, in his newest HBO special, "Never Scared," Chris Rock discusses at length the difference between "rich" and "wealthy," complaining that there are no wealthy black people. One of his examples: "Shaq is rich, the white man who signs his checks is wealthy." i.e. Wealth is defined by being able to own an N.B.A. team, or tons of real estate, or other large assets that you can live off of. Granted, Shaq would certainly be considered "rich" or "wealthy" or whatever by most of the standards cited in this thread, but he's still pretty far (probably almost an order of magnitude) from the very top tier. The folks who have mentioned living off of assets, etc. are on the right track for defining wealth, but i think that being merely rich is a much lower standard, probably in the $300-$500K per year range, depending on financial obligations, family size, location, etc.
posted by rorycberger at 12:44 PM on September 3, 2004
For much more detailed investigations of such phenomena, read Class: A Guide Through the American Status System. It's been a few years, but I think the general rule is that truly "rich" or "wealthy" people tend to downplay their financial situation, as they fear that people will treat them poorly or try and exploit them because of their wealth. On the other hand, those in the upper-middle class range, or the "new money" kind of people like rappers, try to act richer than they are, in the belief that they will be treated much better for having money.
As a sidenote, in his newest HBO special, "Never Scared," Chris Rock discusses at length the difference between "rich" and "wealthy," complaining that there are no wealthy black people. One of his examples: "Shaq is rich, the white man who signs his checks is wealthy." i.e. Wealth is defined by being able to own an N.B.A. team, or tons of real estate, or other large assets that you can live off of. Granted, Shaq would certainly be considered "rich" or "wealthy" or whatever by most of the standards cited in this thread, but he's still pretty far (probably almost an order of magnitude) from the very top tier. The folks who have mentioned living off of assets, etc. are on the right track for defining wealth, but i think that being merely rich is a much lower standard, probably in the $300-$500K per year range, depending on financial obligations, family size, location, etc.
posted by rorycberger at 12:44 PM on September 3, 2004
how bout this: rich is when the money you spend for your day to day needs, including house & car, is a negligible percentage of your net worth.
For the sake of discussing tax cuts and such I think of the rich as at least the top 1% if not the top 0.1%
posted by jacobsee at 2:02 PM on September 3, 2004
For the sake of discussing tax cuts and such I think of the rich as at least the top 1% if not the top 0.1%
posted by jacobsee at 2:02 PM on September 3, 2004
Do you have to work? Well, then you ain't rich.
If you are in the top 5% of income in the US and you are living paycheck to paycheck, then you are not only not rich but you are also a moron.
Exceptions: Paying for elderly parents medical or assisted living care, children of special needs assistance, or just simply donating so much of your money to charities you deeply believe in, and still living paycheck to paycheck at $130+K? Well, you're at least a pretty good egg, but check to make sure you're not a saint. Oh, and keep up the good work.
posted by dglynn at 2:12 PM on September 3, 2004
If you are in the top 5% of income in the US and you are living paycheck to paycheck, then you are not only not rich but you are also a moron.
Exceptions: Paying for elderly parents medical or assisted living care, children of special needs assistance, or just simply donating so much of your money to charities you deeply believe in, and still living paycheck to paycheck at $130+K? Well, you're at least a pretty good egg, but check to make sure you're not a saint. Oh, and keep up the good work.
posted by dglynn at 2:12 PM on September 3, 2004
Income alone is not "rich". If you make a million a year, and piss it away, you are not rich, in that the second that income is cut off, you have nothing. OTOH, if you have assets that produce $100K pa, and you don't work, I would say that you are indeed rich. To be rich is to have independence in the five fresh fish sense.
posted by i_am_joe's_spleen at 2:48 PM on September 3, 2004
posted by i_am_joe's_spleen at 2:48 PM on September 3, 2004
To me there is a distinction between rich and wealthy. If you have huge amounts of disposable income but you have to work everyday to maintain your lifestyle, you're rich. If you have huge amounts of disposable income but do not have to work to maintain your lifestyle, you're wealthy.
posted by gyc at 4:18 PM on September 3, 2004
posted by gyc at 4:18 PM on September 3, 2004
I would consider $100,000 rich by standards where I live (West Michigan) but I recognize it wouldn't go very far in other parts of the country. Then again, I have a tendency to think that people living average lifestyles in other parts of the country ARE rich, because they've invested in the luxury of living in that part of the country.
posted by dagnyscott at 9:03 AM on September 4, 2004
posted by dagnyscott at 9:03 AM on September 4, 2004
This thread is closed to new comments.
$100k can be comfortable but by no means rich. Rich, perhaps if your a single male, but if the total income is $100k and you have family you begin having to settle for inferior goods (Hondas, Toyotas, Ford) to satisfy the need. I hope my economic terms were used correctly.
posted by geoff. at 9:33 AM on September 3, 2004