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Sat Oct 4, 2014, 08:12 AM

who are the wealthy? not the mega rich, but average well off?

I have one of those “stupid” questions. Who are the wealthy? I am not speaking of the Buffet/Koch type, but rather the the upper middle class. I have googled and and find how much per year persons/households make, but not a chart of net worth. A person could make $500,000. per year and be broke; mortgage debt, credit debt. A person/household could make $45,000. per year and have saved over $1,000,000. in investments over time is the second person wealthy, what percentage point on the wealth scale would they be? Top 50%, 20%, 5%?

I have been thinking of the millionaire next door scenario, is a person worth over one million (liquid, stocks, bonds, money market) with out any substantial debt truly wealthy any more, or have the mega wealthy devalued the average persons wealth? Take the one million invest in dividend stocks the return on capitol in dividends would be around $40,000 per year less the low 15% tax rate. Or if one were foolish and were to take a percentage out each year you could estimate living 30 years so you income would be around $33000. per year less the 15%, again not so much. So if you were to retire on your “wealth” you would not be all that wealthy. At what point would you cross in to the I am wealthy mark? One, two, three or five million net?

I understand that I am still speaking of someone who is well off, but the majority of us think of having a million as being rich, as something to aspire too that once you get one million your rich, but in all honesty are you?

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Reply who are the wealthy? not the mega rich, but average well off? (Original post)
RazzleCat Oct 2014 OP
Hoppy Oct 2014 #1
RazzleCat Oct 2014 #2
SheilaT Oct 2014 #3
NewDeal_Dem Dec 2014 #4

Response to RazzleCat (Original post)

Sat Oct 4, 2014, 09:48 AM

1. I am in an unusual situation.

 

I own approx. $250.000 in real estate, partly in rental property. No mortgage. I have a state pension, S.S. and a full time job. My gross income is over 100k.

Then... I pay $1,000 a month towards my mothers Alz. care in assisted living and I owe $95k: car loan, personal loans, etc. that will all be paid off in four years.

I don't feel wealthy but I am not pressured for anything.

I have every reason to expect to be worth one or two million in the next 10 years.

Then, so what? The joys I get from my life are not because I do not have money pressures. I get enjoyment from my grand kids and photography (which I am getting good at).

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Response to Hoppy (Reply #1)

Sat Oct 4, 2014, 12:02 PM

2. I agree with you

you are lucky, you should not worry about your future, but my question still remains. Mostly I am trying to get a fix on what we mean when we say tax the rich. I think the majority of us think of the very wealthy, and not the just entering that area. So we tax the "rich" and I get the feeling that the upper 1% of the 1% will avoid the tax and the upper middle will carry it the tax. So when the collective we discuss taxes on the rich whom do we mean, ergo who are the wealthy?

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Response to RazzleCat (Original post)

Mon Oct 6, 2014, 02:47 AM

3. I often point out that in our culture we are surrounded by messages that tell us to buy.

 

It's not just the advertizements on TV or in magazines, but more subtly and in my opinion, more destructively in the way TV and movies present supposedly ordinary people. Often they are shown as living in homes or apartments that someone in their job could not possibly afford. Or they own clothing and shoes (the women here) that again they could not possibly afford.

So it's very easy to become discontent, to wonder why you can't live in the kind of nice place you see your favorite TV character living in. You never see anything that implies a little delayed gratification can be a good thing.

I am semi well off because while I was married, my in-laws gifted me (and husband and children) every year with money. We never treated that money as regular income, but saved and invested it. A lot of people would have happily used that money to finance a bigger home, a fancier car, more luxurious vacations. We didn't.

Today, I do not have a million dollars, but I have enough, since I'm used to living frugally, that I could retire earlier this year. I'm not even collecting Social Security yet (I'm 66) and I'm okay.

I don't consider myself wealthy, because my income isn't all that high, but in a way I'm wealthy because I do not have to work. If I had, say, five million dollars that I could live off of, then I would consider myself wealthy because at that point my income would be significantly higher than it has ever been.

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Response to RazzleCat (Original post)

Fri Dec 26, 2014, 03:15 AM

4. Top 5% makes over $166K a year and owns the majority of financial and other wealth.

 

Top .01% controls the country and the world.

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