What Does It Mean To Be Considered Wealthy?

What Does It Mean To Be Considered Wealthy?
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One of the tenants that Factum Financial is built upon is wealth. That word conjures up a lot of different, diverse dream scenarios for people when they hear it. One person’s idea of what it means to be wealthy might be wildly different from their neighbor’s idea, but we all have a standard for wealth. Very few people delight in remaining destitute. When we look at what it means to be wealthy, we can consider a few different factors. Looking at currency, there is a tendency to think very ethnocentrically about wealth in the United States. Thinking about capital and wealth from a global standard, it takes much less to be among the wealthiest of the whole world. As a case study, it’s interesting to look at the “value” that makes you a wealthy person by these standards, but our team would encourage you to think about this question in your own financial journey: what does it mean to you to be considered wealthy?

Wealthy By American Standards

When surveyed about the average net worth that catapults you into the wealthy category, Americans quoted a fairly high price. It kind of depends on how you define the word “wealthy” which it seems many people consider above “financially comfortable” in the United States. To be comfortable, the average American would need to make $1.4 million dollars, while they would need to make $2.4 million to be considered “wealthy” among their peers. If the government standards for wealth are a reliable indicator of wealth, then the threshold is much lower: about $500,001 dollars for individuals and at least $600,000 dollars for couples under the current administration’s new tax plan. However, these numbers are even smaller when we consider the high water mark for comfort in the biggest cities of each state. These numbers are affected highly by the cost of living and median incomes of each city. An average of just $55,676 dollars in Detroit, Michigan is comfortable compared to the median income of $27,838, while in Anchorage, Alaska you only need to make $164,542 where the average is already $82,271. If anything, this demonstrates how fluid the idea of what makes the average person comfortable with their wealth. On a global scale, it’s a completely different story.

Wealthy By The World’s Standards

Considering the amount a person needs to make annually to be seen as comfortable in the 50 biggest cities in the United States, it’s wild to look at the wealth threshold on a global scale. If you have a networth of just $93,170 dollars, you are richer than 90% of people around the world. To be considered in the top 50% of the wealthy across the world, you need to have just $4,210 dollars. These numbers are drastically lower than the American standard for wealth and put into perspective just how lucky we have it in the United States.

Is Wealth Determined By Accumulated Currency?

If these numbers indicate anything, it is simply this: wealth is way more than currency. While it’s true that assets can buy comfort, there is no amount of money that can fully fund your satisfaction. While it’s true that a sound financial footing can lead to a stress-free or a less stressful life, the amount of riches one has in the bank doesn’t really lend you security, something that 80% of Americans felt was the biggest component of what it means to be wealthy. To be wealthy on a personal level, one simply has to adopt a mindset that focuses on personal security, comfort and fiscal health with a plan for the future and preparations in place for any emergency scenario that might occur. If all it takes is a mental shift and approaching your finances differently, what is holding you back?

Adopting A Wealth Mindset

When you realize that wealth is a mindset, not a number, you can start living your life in a manner that endeavors to remain wealthy. What does being wealthy mean to you? Is it comfort, legacy, or security? Does your wealth plan include a nice home or a car or is it as simple as the ability to take your spouse on an extravagant date without counting your pennies? No matter what your goals are, Factum Financial can help you reach them. The wealth strategists on our team can help you set your financial goals and reach them. We emphasize financial practices that ensure you grow your wealth and protect it, so you remain in control of the banking function in your life. Contact our team today at 480-525-8180 to arrange your free 30 minute wealth strategy session.

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Zachary Gray is the Content Writer and Editor for HJR Global and associated companies. Zachary lives and works in the Phoenix Valley and writes on a variety of topics.