How Much Money Do You Need to Be Rich?

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Pretty much everyone wants to be rich—not purely for the sake of money, but for the fragile promise of happiness that comes with being a total baller. But, what does it mean to be rich today? How much money do you really need?

The answer might just surprise you. See, it’s all a matter of relativity. We often think of Musk, Bezos, and Zuck as our benchmarks for wealth. But I’m betting you’d rather know how you’re doing against other mere mortals, right?

Mere Mortals Like Us

The U.S. middle class holds a collective $12.5 trillion of our country’s wealth. If you do the math, that equals about $472,000 of net wealth per person. Net wealth is defined as the total value of what you own, minus what you haven’t paid off yet. Make sense?

So, how do you know if you’re in the middle class in America? Well, if you take the top and bottom 40% of wage earners away, you’re left with the middle 20%. (Hence, the term “middle class.”) The top end of that middle class makes about $100,000 per year.

That’s not crazy rich in American terms, but the middle class has done pretty well in the last decade or so—at least from a savings standpoint.

See, back in 2012, the average middle-class family only had about $313,000 in net wealth. But, from 2012 to 2022, that same family saw a 60% increase in net wealth. That net wealth peaked in 2022 at $499,000. (We all spent less money when we were sheltering in place.) Today, that number is down to $472,000.

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The Yachting Class

I’m gonna guess that you think you aren’t keeping up with the Joneses down the street. Or that the “yachting class” is hoarding all the wealth in this country, am I right?

That may be true, but before you cry yourself to sleep, here’s a spoiler alert: you are already rich—crazy rich. In fact, nearly 60% of Millennials already feel wealthy. I guess it’s a matter of defining “wealthy.” But hold that thought for 90 seconds.

According to World Bank, the international poverty line is the threshold that determines whether someone is living in poverty. That line is based on the value of goods and services needed to sustain one healthy adult.

Today, it sits at an astonishing $2.15 a day, or about the cost of a tall black coffee at Starbucks, without any of that flavored syrup.

According to Worldvision.org, 712 million people live on less than the cost of that Starbucks coffee each day. In contrast, the US Federal Poverty Line for 2024 was $15,060 per year.

We Have Great Toilets

I think it’s a safe bet that neither of us lives in Ethiopia on $2.15 a day. In America, our pets sleep in better conditions than most humans in other countries.

In comparison, around 52% of the Ethiopian population uses a dry pit as a toilet. The remainder use bucket toilets, open pit toilets, or simply relieve themselves outside. Can you imagine if someone from Ethiopia visited a restroom at the Buc-ee’s convenience store? The men’s room has 35 urinals and another 20 stalls.

In America, most of the poor have access to clean water and modern sanitation. 76% of people below the poverty line have access to a smartphone. Around 59% have access to a laptop or desktop computer. I’m not saying they live on “easy street”, but if you’re gonna live below the poverty line this is the place to do it.

Most people in Ethiopia have never even heard of a Smartphone, a laptop computer, or a Buc-ee’s convenience store—or even a toilet, for that matter.

With all those toilets and the comparative wealth in the United States, we should be pretty darn happy, but we aren’t.

Comparative Unhappiness

According to the World Happiness Report, for the sixth year in a row, Finland ranked as the happiest country on earth. It’s followed by Denmark, Iceland, Israel, and the Netherlands. European countries including Sweden, Norway, Switzerland, and Luxembourg, dominate the rest of the top 10. With all our comparative wealth, freedom, and toilets, the United States only ranked 15th.

I think we can both agree that we’d like to have more than $472,000 in net wealth. We can also agree that if we had ten times that number, we’d still want more. How do I know this? It’s human nature. As long as someone else has more of something, we feel slighted.

In order to feel wealthy, the average Boomer needs $692,000. The average Millennial needs $531,000. Yet the Millennials feel richer than Boomers. Perhaps the Millennials have yet to contemplate how much money it takes to educate their children and not end up in a trailer park eating Ramen noodles and SPAM in their retirement years.

Yes, we all want more. We all want to be total ballers. But, getting everything you want in life is how people end up in rehab, wondering how many grandkids they have. Money can’t buy or restore relationships. Money can’t bring back friends, loved ones, or pets from heaven. Money can’t cure cancer. Just ask Steve Jobs how that turned out.

Big Finish

Alrighty, we’ve learned a lot here today about what it means to be rich. First, you probably feel like you aren’t keeping up with the Joneses. I feel you. Second, our pets sleep in better conditions than most humans around the world. Third, somebody else is always gonna have more money than you, especially if you’re an American. Fourth, you are already filthy rich by nearly any world standard. Stop complaining. We both know you’d never make it on $2.15 a day. Lastly, if you’re feeling sorry for yourself, take an extended trip to Ethiopia. A few days of using that open pit latrine will set your mind right.

Hey, I’d like to talk to you. Do you think more money would make you happier? What about living in another country? Let’s discuss. Simply hit the button below and leave me a message. I promise you’ll hear back from me, even if we disagree.

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