When are you considered wealthy?

An actual number is highly personal and specific to the individual. There are a couple scenarios that put you in the wealth category, even if you don’t have a lot of money in the bank.

  1. An income stream that is not dependent on day to day working and can support your basic needs. If you have some sort of income stream that is mostly passive and earns enough money to cover your housing, food, insurance, etc. then you’ve entered the wealth category.
  2. When you’re net worth in 5x your average income. Keep in mind that for most wealthy people there income is constantly growing, so getting to 5x will take a long time.
  3. When you have 20x your annual budget saved. This number is a little more in your control given that you can choose to a large degree how much money you spend. Even if you start to earn at a high rate, you don’t need to send. You could conceivably do this in a couple years.
  4. When your primary financial concern is how your investments perform. Once you’ve gotten to a point where you have 5x+ your income invested, the performance will be far more important than what you actively earn each year. If you have $2 million in stocks and $100,000 salary, the stocks are going to fluctuate more in an average day, month, or year than you’ll earn at your job.
  5. When shopping around for good prices feels like a waste a time because most of what you buy is insignificant to your overall financial picture. When I was in college I would go to three different grocery stores in an effort to save literally $1 on my trip. As I start to earn real money I decided to completely disregard any that cost less than $5 and just buy it. Over time that number has gone up. Now I only really need to plan out large purchases like cars, housing, etc. Day to day shopping is one less thing to worry about. Someday I’ll be able to buy a car or house and not notice the financial impact.
  6. When girls like the one below get a clue of how much money you make/have and swarm:

Not really, it takes a surprising small amount of money spent on a few select items to impress a young attractive women. This is probably the easiest financial thing to fake.

If you want to feel wealthy faster, I highly suggest incorporating concepts of minimalism. Once you train yourself and your mind to only care about things that really matter, you will be much less stressed and much happier. Learn a few quick tips from My Minimalist Lifestyle. If you want your day to day expenses to be insignificant and your investments to pay for your life, you’ve got to get control of how you live and change the way you approach money. If you want to learn more about how millionaires approach money, read my favorite book The Millionaire Next Door. 

This page may include affiliate links. If you click on a link and complete a purchase, I may receive a small commission at no cost to you. 
Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s