People have always aspired to be “rich.” Some would argue that being truly wealthy goes far beyond material things. But do you know, strictly speaking, financially speaking, what it takes to be considered wealthy in 2024? It’s a mix of income, net worth, and where you live. Definitions of wealth vary, but here’s a look at what it generally takes to be considered wealthy today, using some benchmark standards.
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Income thresholds: what you need to earn
The top 20% of earners are typically classified as “upper class.” To get into the top 20% of earners in the U.S., you generally need to earn around $130,545 per year. But this number isn’t the same everywhere. For example, if you live in New Jersey, you’ll need around $180,558 to reach that point. In Mississippi, it’s lower, around $101,447.
If you want to be in the top 5%, the bar is much higher. In Connecticut, for example, you need to earn more than $600,000 annually. And if you want to be in the top 1%, you’re looking at an income of about $819,324 per year — or about $68,277 per month.
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Net Worth: What You Need
In terms of net worth, $1 million in cash often puts you in the “high net worth” category. But if you want to qualify terribly high net worth, then you might need $5 million to $10 million. For those aiming even higher, ultra-high net worth status could mean having $30 million or more.
Interestingly, the perception of what makes someone rich has changed. According to Schwab’s Modern Wealth Survey, Americans now believe you need a net worth of about $2.2 million to be considered rich. This number is down slightly from 2020, when people thought $2.6 million was the magic number.
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Location Matters: Cost of Living
Where you live plays a big role in what it takes to get rich. In expensive places like New York or California, the income needed to be in the top 20% is much higher than in states with a lower cost of living. Wealth isn’t just about money, though; it’s also about what you can buy with that money, and that changes depending on your location.
Distribution of wealth: who has what?
Wealth in the U.S. is not evenly distributed. The top 10% of households control a large portion of the country’s total wealth, with an average of about $6.7 million per household. On the other hand, the bottom 50% has an average wealth of just $50,000, according to the Federal Reserve Bank of St. Louis. This gap shows how varied wealth can be depending on where you fall on the economic spectrum.
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Mindset and lifestyle: it’s not all about money
Being wealthy isn’t just about the numbers; it’s also about how you think and live. Rich people tend to focus on long-term goals, invest wisely, and build strong networks. They also value experiences and relationships more than just accumulating more stuff. Many prioritize work-life balance and staying healthy, which they see as part of being truly wealthy.
The heart of the matter
In 2024, being wealthy isn’t just about achieving a certain income or net worth—it’s also about having the right mindset and living in the right place. Whether you’re earning a high salary, accumulating assets, or focusing on personal growth, the definition of wealth is broader than ever today. But no matter how you slice it, achieving that “wealthy” status requires a mix of financial success and a lifestyle that supports it.
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This article Exactly How Much Money Do You Need To Be Rich? Here’s A Look At The Numbers originally appeared on Benzinga.com
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