How Do You Know When You’re Rich?

Quick, answer this question with the first number that comes to mind:

How much money do you think you need to feel rich?

Of course, you may argue, there’s more to being rich than having money—there’s love, health, freedom, etc. All true. But for the purpose of this blog, and in the spirit of research, let’s stick with the original question that recently appeared in The Wall Street Journal: How much money does it take to be rich?

According to the article—which was excerpted from Robert Frank’s blog, The Wealth Report—no one can seem to agree about the amount of money that makes you rich.

According to the Federal Reserve, you’re in the top 5% of Americans if you have a networth of $1.4 million. But when Spectrem Group asked affluent people that question, only 22% said $1 million makes you rich. The majority (45%) said it took at least $5 million to qualify. A quarter of the respondents swore that you need a minimum of $25 million. A few (8%) even put the winning number at $100 million. Still, other studies have shown that people “always give a number that is twice their current networth or income. Those with $100,000 in income say $200,000, while those worth $5 million say $10 million.”

I thought about what I’d say, and realized the term “rich” is so relative, it’d be impossible to come up with a universally accepted number. The best definition I’ve ever seen for “rich” was the one I used in my first book, Prince Charming Isn’t Coming. I forget who said it, but it goes like this: “rich is when you work because you want to, not because you have to.”

That makes a lot of sense to me. Anyone have a better definition than that??