Via CNBC comes this news from a Fidelity Investments survey:
More than four out of ten American millionaires say they do not feel rich. Indeed many would need to have at least $7.5 million in order to feel they were truly rich, according to a Fidelity Investments survey.
Some 42 percent of the more than 1,000 millionaires surveyed by Fidelity said they did not feel wealthy. Respondents had at least $1 million in investable assets, excluding any real estate or retirement accounts.
The average age of respondents was 56 years old with a mean of $3.5 million of investable assets. The threshold for “rich” rose with age.
Suspending snark (for just a moment, I promise), I can actually get a bit of what’s going on here: Taking the usual prudential advice on a low-risk rate of return, one would draw about 4% per year — maybe 5% if you’re a plunger — from a pool of capital one is trying to preserve. That’s how university endowments work, more or less, which is where I’m getting this back-of-the-envelope calculation. $40,000 or $50,000/year isn’t rich.
But of course, what’s missing from that calculation is the difference in security between someone with a million in the bank making $50K a year and someone with $3,568.23 in a checking account drawing that same fifty big ones. If rich doesn’t describe the difference, maybe “comfortable” captures what it means not to have to live from paycheck to paycheck. Very comfortable.
And, of course there is what the article does not say, though it strongly implies: there is a difference it’s important to recognize between feeling rich (musn’t hurt our overlords’ fee-fees) and actually being so. By any reasonable definition, $10^6 in the bank = rich.
It’s a measure not of straightened circumstances, but of a distorted culture — dare I say it, one intoxicated on legends of Galtian superheroes — in which one finds its most fortunate and, yup, comfortable citizens feeling unsatisfied in their historically unprecedented levels of security and privilege.
That’s all one needs to say, I think, but for my favorite factoid from the study:
Fidelity noted the wealthiest 5 percent of Americans hold more than 55 percent of the nation’s wealth.
With that, over to you, my friends.
Image: Hieronymous Bosch, Death and the Miser, before 1516.