Personal Finance

At what net worth is someone considered rich or wealthy?

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  • Nov 25th, 2012 3:24 am
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Deal Guru
Feb 9, 2009
12381 posts
11307 upvotes

At what net worth is someone considered rich or wealthy?

I see the term "rich" get thrown around alot. So at what net worth is someone considered rich?

$1 mil? $3 mil? $5 mil? $10 mil?

Obviously, each person thinks of rich in different terms.

To me rich is when the interest and/or dividends from your investments can give you enough where you don't have to work again (again the amount is debatable) and/or physical assets such as real estate that grow in value over time (with some corrections along the way).

To me $2 million is considered rich. Why? Cause at $2 mil in liquid investments, if you put it good low risk dividend stocks, it could throw out around $70-$110k in dividends, which is also taxed at a much more favourable rate than interest. Also, if they owned assets at $2 mil or more net, I would consider them wealthy.

What is yours?

Ps- to be considered extremely wealthy in my eyes Im looking at $20 mil or more.
36 replies
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Feb 15, 2008
26318 posts
3242 upvotes
Calgary
I think you need to add age to the equation. A 30-year-old with $250k in non-RE wealth is doing incredibly well and is statistically part of the 1% in Canada.

A 80-year old with $250k in non-RE wealth in Canada is basically just a little bit above average.
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Deal Addict
Feb 24, 2007
1371 posts
55 upvotes
+1 on being able to live off investment income. But that isn't the only thing, it really about certain lifestyle attainment, because you could live off of a few 100k thousand if lived frugal. But I wouldn't call that rich even if you were living 100% off of investment income. I agree with what number you had, maybe a little higher. Several million should generate several 100k in income, and several 100K income is what I would consider to be able to attain a "rich/wealthy" lifestyle.
Deal Expert
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Nov 2, 2003
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GTA
when they have more money than you, you think of them as rich!
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Aug 1, 2008
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Montréal
actng wrote: when they have more money than you, you think of them as rich!
+1
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Deal Addict
Sep 30, 2008
1277 posts
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Having $2 million in liquid investments would make one feel rich, but generating only $70k-$110k income annually would barely make one to subsist after paying off household utilities and expenses. Being rich, one should be able buy things he likes (e.g., boat, a nice car, etc), and travel to exotic countries. Having $70k-$110k before tax may not afford his life style.
Deal Addict
Aug 14, 2007
2434 posts
328 upvotes
Waterloo
Enough money to be able to retire and do what you want to do get what you want to get without having to make any sacrifices or worry.
I am 27 and would think that I would consider myself stinkin rich if I had anything over 2 mil.
Sr. Member
May 29, 2006
691 posts
225 upvotes
When you own your home outright....have no debt and over 1 million in investments/savings you are now rich.
Sr. Member
Dec 27, 2002
526 posts
108 upvotes
Mississauga
Mark77 wrote: I think you need to add age to the equation. A 30-year-old with $250k in non-RE wealth is doing incredibly well and is statistically part of the 1% in Canada.

A 80-year old with $250k in non-RE wealth in Canada is basically just a little bit above average.
Mark, are these stats available somewhere? I would like to see where I fall among my age group.
Member
Feb 20, 2011
460 posts
92 upvotes
Without putting a dollar value on it, I would say that you're wealthy when money isn't something you worry about anymore. When you have enough money that you can do and purchase all the things you would like without ever having to stop for a second and try to fit it into a budget, you are rich (at least in some sense of the word).
Deal Expert
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Nov 2, 2003
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GTA
so u guys think rich is tied to being materialistic?
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Sep 10, 2007
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Cowtown
You are rich when you dont have to worry about spending money on everyday stuff (mortgage, bills, gas etc). My relative has lot more money than me but I dont consider him richer than myself as spending a dime will be tense decision for him but I can spends hundreds when I need or want some (of course by keeping my limits in mind).

So money is not the only thing you need in order to be rich – a person making 50K may feel richer than a person who makes 200K.

I'm not rich, but have no worries for mortgage – so IMO that makes me happier than lots of rich people living in multimillion houses with mortgage.
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Jr. Member
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Apr 26, 2012
167 posts
17 upvotes
Toronto
VifferFun wrote: In a world sense, we're all extremely wealthy. Most of us are already in the top 1% of world income, yet we're never satisfied.

http://www.globalrichlist.com/how.html
^^ that is an eye opener..

Will make me think the next time i hear a rebel revolutionary talk about "we are the 99%"... I'll have to correct them - "Oh, you make minimum wage? well then.. actually, you are the top 10% you greedy capitalist pig" hahah
Deal Addict
Jun 9, 2006
1605 posts
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Thornhill
IMO, you are only rich/wealthy when you have the ability to buy whatever the heck you want without ever worrying about cost. :P

Look at how billionaires spend their money... Millionaires don't even come close to being rich :P
http://www.businessinsider.com/most-exp ... 011-6?op=1

Even majority of millionaires can't even afford that, thus they are poor!
Deal Guru
User avatar
Nov 5, 2001
11979 posts
3170 upvotes
Edmonton
Having 100k+ in the bank, 100k+ in investments and a paid off house - comfortable for retirement.

Having 1mil+ in the bank, 1mil+ in investments, paid off house, rental properties, vacation home, cars/boat - rich.

Having 1bil+ in the bank, 1bil+ in investments, multiple homes, office towers, auto collections - wealthy.

Nobody on the earth is a trillionaire yet, are they? That's true baller status...
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Aug 22, 2009
589 posts
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Guelph, ON
BennyBP wrote: ^^ that is an eye opener..

Will make me think the next time i hear a rebel revolutionary talk about "we are the 99%"... I'll have to correct them - "Oh, you make minimum wage? well then.. actually, you are the top 10% you greedy capitalist pig" hahah
Yes . . . many of the revolutionaries ARE the world's 1%, which I find rather ironic. These people are the 1% complaining about the 0.01%. I wonder if the world's 99% thinks that these revolutionaries are ridiculous? To us, it would be like multi-millionaires whining about the billionaires.
Deal Expert
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Nov 2, 2003
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GTA
some of the last few posts are as removed from reality as romney's 47% statement.
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Jan 27, 2004
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ONTARIO
The richest person is the one with the most love and life experience. :)



I met this one gentleman. He was really wealthy. Some sort of engineer and consultant. But he was 50, divorced, and bitter... Sure he had the nice car and I assume a nice house (and nice bank account)... But he didn't seem all that fufilled. He was always really mean to me and all the other tellers. One little mistake and the guy will flip . . .


But I also met this old couple... They had a single child really young. They were only 20 and 18 at the time. But their kiddo turned out to be a nice fellow who wasn't too bright, but was good with his hands. He got into the plumbing trade and started his own company. His little business grew pretty big and he helped his humble parents retire.

The old couple eventually spent 5 years RV'ing across Canada and USA. Then sold the RV and traveled across Europe and Asia for a few years before coming back to Toronto.

Nice folks. :)
Jr. Member
Jan 13, 2008
110 posts
57 upvotes
There is no right answer to this question. The ultimate goal is financial independence based on lifestyle. I would consider myself rich if my dividends could earn the average Canadian hourly wage of $24 hour (approx 50K per year) and my house was paid off.

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