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When Will You Feel Rich?

{ 96 comments }

When Will You Feel Rich?Hey, do you feel rich? Yes, yes, I know. It’s all relative and some people say you’re rich if you’re healthy, have a good relationship, are an integral part of the community, and help the less fortunate. I agree that you don’t have to have a ton of money to feel good about yourself, but let’s focus on money today. 😉 (This is one of those posts when I don’t have a clear idea of what to write about. Someday, I just have to start writing and see where it takes me. As I recommended in how to start a blog, you gotta stick to the schedule.) First of all, please take a poll. I’m sure everyone is curious to see how our readers feel about themselves.

How rich do you feel?

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Why I don’t feel rich

Back to the topic at hand. We’re doing quite well financially, but I don’t feel rich at all. Our net worth is over $2 million, but the majority of that is in our retirement accounts and real estate. We could access them if absolutely necessary, but it’s not exactly liquid like money in a savings account. Also, our monthly cash flow is actually not that great. On average, we have about $1,000 per month left over after our expenses. The expenses include saving over $50,000 in our tax-advantaged accounts, though. Anyway, the $1,000 per month extra cash doesn’t make me feel rich. That’s peanuts.

Maybe I don’t feel rich because we live a regular middle-class lifestyle. Our possessions are modest and not exactly what one would consider luxurious quality.

  • We live in a modest 1,000 sq ft, 2 bed, 2 bath condo. The location and view are awesome, though.
  • Our one car is a 2010 Mazda 5 minivan. The mileage is relatively low because we don’t drive much.
  • There are plenty of consumer electronics in our home: 3 laptops, an Amazon Kindle tablet, 3 smart phones, a 720p flat screen TV, a DVD player, an old XBOX, a VCR (time to throw this baby out?), and two stereos.
  • We eat out a few times per month.
  • A lot of our things are getting old and worn out, but we don’t want to replace anything until we move into our rental. I really want a nicer dining set, but it can wait a bit. Our memory mattress is over 10 years old and it is not as comfortable as it once was. Someday…
  • We rarely pay for expensive entertainment. I like free activities such as going for a walk, getting some books from the library, and enjoying free concerts in the park.
  • We cook, clean, do our own laundry, and other chores. We don’t hire anything out unless it is beyond our ability.
  • The one thing we spurge on regularly is international travel. We love seeing different parts of the world and experiencing other culture.

I guess our middle-class lifestyle is just too mundane. I imagine rich people lead much more exciting lives and have more helpers. They go to shows, hang out at country clubs, drive luxury cars, and have helpers to do chores for them. Sounds nice, doesn’t it?

Feel Rich

What it would take to feel rich? I’ve been thinking about this for a few days and I think I got it. Our wealth building progression is too steady. Our net worth increases a little bit every year and life stays pretty much the same. I’m very happy with the slow and steady model, but it doesn’t make me feel rich. Previously, I imagined I would feel rich if our net worth ever reaches $5 million. However, now I seriously doubt it. I’d feel the same whether we have $4.9 million or $5 million. It’s like turning 40. Nothing really changed.

I think something that jars us out of normalcy might do the trick. For example, receiving a large windfall or winning the lotto. That would give us an immediate lift and I’d feel rich! At least for a while, anyway. Or maybe moving to another location with much lower cost of living. We could move to Thailand and our purchasing power would increase immediately. We could eat out all the time and hire people to clean and do laundry. That sounds pretty good, right? I plan to do that at some point, but just for a few years. It’d be fun and probably save us some money.

Here is a second poll. 🙂

What do you think will make you feel rich?

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How to feel rich

You know what? My 20 year old self would be amazed at how rich I am today. Back then, I didn’t have any of the stuff I listed above. I’m quite grateful for being where I am today. I guess I’m pretty rich after all. Sometime, you just have to step back and look at it from a different perspective.

What about you? Do you feel rich? What’s the secret? You can share anonymously in the comment if you don’t want to use your name.

Lastly, I’ll have to give credit to Financial Samurai for planting this idea virus in my head – When Do You Finally Feel Rich?. I forgot he wrote about this exact same subject about a month ago. It must have been bouncing around in the old noggin and made me write this today…

{ 96 comments… add one }
  • Michael @ Financially Alert February 23, 2017, 12:37 am

    Hey Joe, I definitely feel rich in the sense that I experience an overabundance in many areas of my life that others may not. Like you say, it does come down to relativity and those around you. To some in my extended family, my NW pales in comparison. Yet to others, it’s rather large. So, it really depends on what you want and can you afford it comfortably.

    BTW, did you hear that someone in Indiana just won $400M? I’m pretty sure he/she feels pretty darn RICH today!! 😉

    • retirebyforty February 23, 2017, 9:07 am

      $400M would do it. 🙂
      Comparing to extended family is a good way to do it. Most of my extended family live in Thailand and we’re doing quite a bit better financially, but they have a very good lifestyle too. It’s nice to live where the cost of living is low. Some of my extended family are quite a bit richer than we are. I’m very happy for them. They are all very nice people.

  • Mr. Tako @ Mr. Tako Escapes February 23, 2017, 1:55 am

    I’m in the same boat as you Joe — a multi-millionaire, but still not feeling rich boat.

    Part of it I think is that I lead a really normal life. The things I’ve been told rich people have, don’t exist in my life. Sure, I could go buy them…but I won’t. It would be a waste of money.

    For me, I believe people are rich when they can start buying back time. Hiring a chef so you don’t have to cook any meals. Hiring a housekeeper so you don’t have to clean. Using your private jet so you don’t have to wait in line at the airport.

    That to me is rich. When your time has so much more value that you can afford to hire other people to solve the mundane problems in life.

    The cash flow it requires is huge. Most people will never achieve that level of wealth.

    • retirebyforty February 23, 2017, 9:09 am

      I like your definition. We could be rich as soon as we move to Thailand or south of the border. 🙂
      Labor is cheap in many parts of the world.

  • Ernie Zelinski February 23, 2017, 2:06 am

    Given that I lived under the poverty line for several years, I feel rich today. Sure, I can’t afford a house in Vancouver, which is my second home. In the same vein, my net worth may be approaching only $1.5 million Canadian, which is not all that much compared to multi-millionaires and billionaires.

    Nonetheless, I feel truly rich. Here are just a few of many reasons.

    1. I have absolutely no debt.

    2. I am financially independent even though I have worked less than half of my adult life, and when I have worked, I have only worked 4 or 5 hours a day.

    3. In 2015 I was a 1 percenter in Canada in terms of income.

    4. At 67, I am 1 percenter in terms of income for people my age. This will be the case even if my income falls down to $114,000 per year, which it shouldn’t for at least 5 years, possibly not for 10 years even if I don’t do any work.

    5. I get to fly Business Class a lot. Indeed, I will likely get to make at least 15 Business Class flights in the first 6 months of this year. Several of these flights will be paid for by clients who want me to speak to their members about either “The Joy of Not Working” or How to Retire Happy, Wild, and Free.” I will also get to stay in first-class hotels in places such as Washington, D.C.; New York; and Orlando at the expense of others.

    6. I get to buy organic food without considering the price. I also never have to cook because I can afford to buy healthy food from the supermarket delis. Still more, I can go out to high class restaurants at least three times a week and not have to worry about the cost.

    7. I have my creativity which I value at a minimum of $10 million. Many people will laugh at me — but these hollow heads have not created $2.4 million of pretax profits from intellectual property like I have. And I know that I can create much more wealth this way. I aim to prove this by creating another true bestselling book that sells over 100,000 copies and makes me well over $1 million in pretax profits.

    To feel truly rich, I like to keep in mind these “Seven Little-Known Spiritual Rules of Money and Prosperity”:

    1. If money becomes your primary focus in life, then money is all that you will get.

    2. Spending a lot of money can get you trapped into thinking you are prosperous and having a good time when all you are doing is spending a lot of money.

    3. The person with no money may be poor; however, not as poor as the person who has nothing but money.

    4. Prosperity isn’t a matter of acquiring how much money you desire; it’s a matter of being happy with how much you presently have.

    5. It is better to be out of money than out of new creative ideas on how to make money.

    6. The true value of money lies in its creative and spiritual uses and not in how many possessions it can buy.

    7. The prosperity that you bring into your own world will be determined by the enrichment you create for others in the Universe.

    • Eric B February 23, 2017, 9:00 am

      Great points, Ernie! Thanks for bringing a fresh perspective to this discussion.

      Joe, you may want to take a look at this site to see where you stand relative to the rest of the world: http://globalrichlist.com/

      I suspect you’re in the top 0.3% for net worth worldwide, so while you may not feel like you have an unlimited amount of money after your expenses, I think you are objectively rich by global standards and you should feel proud and grateful to have achieved this status 🙂

    • retirebyforty February 23, 2017, 9:11 am

      Thank you for sharing your wisdom. I really appreciate your input.
      This one really resonate with me – It is better to be out of money than out of new creative ideas on how to make money. I agree 100%.

  • Brad - MaximizeYourMoney.com February 23, 2017, 2:46 am

    “Rich” to me is extravagance. “Wealthy” is having financial freedom. With about $3million in net worth, and a reasonable (IMO) annual budget around $75k, I definitely feel wealthy and know I have a pretty good chance of having some money left when I die. I don’t feel “rich” though. It isn’t even a goal of mine. If we win the lottery or otherwise come into insane amounts of additional money, we’ll likely set up some charitable foundations and start giving it away. Having $100 million dropped in my lap wouldn’t encourage me to change much in my lifestyle. I’m pretty content. 🙂

    • retirebyforty February 23, 2017, 9:13 am

      I think you’re right. Rich is having an excess of money. I do feel wealthy, but not rich. I would also do more with charity if we ever get a windfall like that.

    • Retiresoon February 24, 2017, 4:22 pm

      I agree w your definition on rich. I’ll add mine: spend frivolously without really impacting your networth.

      – I think I’m going to buy a new 911 today.
      – Let’s fly a private jet this weekend to Hawaii and get a suite at the ritz.
      – should we buy another vacation home we only use 6 nights/yr

      Rich is relative though. Some may say owning a home or having no debt or driving a Mercedes makes one rich.

  • Al February 23, 2017, 3:58 am

    Coming from poverty, feeling rich is somewhat of a controversial subject because it involves acceptance and life self realization.

    Acceptance from a standpoint of belonging. Extreme poor people do not feel they belong and have to convince themselves they do. Big challenge to overcome.

    Everyone pays a price for happiness and the price is relative from where you started. If you ran 26 miles and another 2.6 miles to get overcome something. Both persons, overcame but one ran 90% more to get there.

    Self realization from a standpoint that you have achieved, provided, and full filled the responsibilities in life. Street people never feel comfortable and are in a continous state of alertness or paranoia. Sometimes one looks back over our shoulder and can’t believe their journey or remember the person who made it. Sort of a being loss feeling or going to a class reunion after 40+ years and remembering or being recognized by people.

    Happily these are challenges have been attained and overcome but not forgotten.

    Feeling rich is having the time, money, and the peace of mind to self-realize, accept, and understand your life journey.

    I guess, I feel rich! Not what I thought.

    • retirebyforty February 23, 2017, 9:20 am

      It sounds like you came a long way. Great job!
      I’ve never experienced extreme poverty and I think it would be very difficult to escape from that position. There are a lot of head wind. We were poor for a few years, but always had enough food and a roof over our heads. Best wishes.

  • Pennypincher February 23, 2017, 4:04 am

    Dear Millionaire Next Door- Good thought provoking questions in the polls. I think feeling rich is not a set amount of cash, but really about freedom. Freedom to do and go where you please. Freedom to help others in need. Always having options open to you. Feeling secure, sleeping at night, not worrying about the stock market dropping-yes, you can have money worries w/too much money also.
    Keep the VCR Joe. It doesn’t take up that much space, and I’m sure you have some good classic (Disney) movies, or will find a few good ones at a flea market or garage sale! : )

    • retirebyforty February 23, 2017, 9:22 am

      I love your answer! Freedom is what it’s all about.
      We do have a few video tapes lying around. 🙂

  • Natalie February 23, 2017, 4:07 am

    I’m always amazed when people think having a million dollars is rich. I was watching a game show and when asked what she would do if she won a million dollars she said she would buy a house in Hawaii, an expensive car, travel and retire. Now granted, I’m not going to turn my nose up if I’m handed a million 🙂 but I know what it will and will not provide. My idea of rich is being debt free, healthy, and providing my sons with an education or skill that is marketable. Some folks would consider me and my husband as rich ($3M) but the only “rich” thing I can think of is that we have a maid service come and clean every 2 weeks ($75). To me that is a true luxury and I can honestly say probably saved our marriage.

    • retirebyforty February 23, 2017, 9:25 am

      Heh heh, a million probably can’t even buy a house in Hawaii. She forgot about tax.
      Good move with the maid service. $75 every 2 weeks is an extreme low price to pay for a harmonious marriage. 🙂

  • RayinPenn February 23, 2017, 4:21 am

    You don’t feel rich because:
    1. The new threshold for rich is 10 million – so your not rich.
    2. If you retired and followed the 4% withdrawal rule you’d only get $80 grand a year and last time I checked that’s far from wealthy
    3. Money sneaks up on you and once acquired after a while the pile your staring at doesn’t seem all that big.
    4. The people who save up a big pile tend to be the cautious types and they never let their guards down. Can anyone answer what will healthcare cost in 10 years?

    I much prefer the expression ‘well heeled’ as being rich seems to make you a target to some.

    • retirebyforty February 23, 2017, 9:26 am

      Wow, $10 million. That’s a lot of money. We’ll never get there at this rate.
      Good comment. Also, people with a big pile always feel like it’s not enough.

  • Go Finance Yourself! February 23, 2017, 4:21 am

    To me, being rich is having enough money that you can choose to do whatever you want with your time. You can continue working if you truly enjoy it, go hang out on the golf course, or be like Peter from Office Space and just do nothing. So once I reach financial independence, I think I will feel rich. Once I have enough money to recreate my current standard of living without having to work, then I will feel like I’ve made it.

    • retirebyforty February 23, 2017, 9:27 am

      I love your answer. That’s freedom. But, I don’t think you’ll feel rich after you’ve been FI for a while. It’ll just be normal.

  • Nicoleandmaggie February 23, 2017, 4:32 am

    We have a smaller net worth than you do, but I feel rich. Because I can buy anything at the grocery store I want. I can turn on the ac or heat without worrying about costs. I own a dryer and a dishwasher and a microwave and computers. I don’t have to pay attention to how much the gas I put in my car costs. I don’t worry about money or fight over money.

    Maybe that’s just a middle class lifestyle but it is way more than I grew up with, so I feel rich.

    • retirebyforty February 23, 2017, 9:28 am

      That’s great! I might feel richer if we loosen up a bit. We’ve been living frugally for a long time.

  • The Green Swan February 23, 2017, 4:41 am

    Those are some good questions you pose, Joe. I think for me to feel like a rich person I would need enough money so that I don’t ever have to think about it. I could spend and do whatever I wanted and not even consider money. That’s rich to me. Not sure if I will ever get that feeling or not, it is a balance of working long enough to reach that point and also retiring early to enjoy the life we have. I guess my goal is to have enough, not necessarily to be rich.

    Good thought provoking post, Joe, even if you did just wing it 😉

    • retirebyforty February 23, 2017, 9:29 am

      Nice. Not having to consider money would be great. I don’t know if we’ll ever get there psychologically. We worry about money too much and probably can’t detach like that.

  • beth February 23, 2017, 4:41 am

    Invest in a new mattress. You will be amazed at how much better you sleep and that is good for your mental and physical health. You can skimp somewhere else.

    • retirebyforty February 23, 2017, 9:30 am

      I’m so ready to buy a new mattress, but I just don’t want to move it. We’re planning to move within 2 years and we’ll throw out a ton of old stuff rather than move them.

  • Apathy Ends February 23, 2017, 4:48 am

    Definitely don’t feel rich sitting on a bus on my way to work right now. I agree with Tako above on being able to buy back time would make me feel rich.

    It’s hard to put a dollar figure on it, at 5 million we would definitely spend differently than we do now. Maybe we will never find out how it feels.

    • retirebyforty February 23, 2017, 9:31 am

      $5 million is a good goal. I suspect the goal will be higher by the time we get there, though.

  • Dividend Growth Investor February 23, 2017, 5:51 am

    Hi Joe,

    It is interesting how we adapt to our present conditions however. You feel the same, whether you have $1M, $2M, $5M or $10M.

    I think it is better to be in your position, and not feel rich, rather than feel rich and be poorer. Many individuals spend all their money on expensive toys, and probabaly look very successful and well-to-do. But you have done the prudent thing by saving and investing for the future. You may not feel like it, but in my view, you are rich.

    In my view, you are rich when your investment income equals your expenses. If your $2M were invested in a portfolio of dividend stocks yielding 3%, it would generate $60,000/year in dividend income.

    Alternatively, you can follow the 3% rule, and sell 3% off your index funds each year

    Best Regards,

    Dividend Growth Investor

    • retirebyforty February 23, 2017, 9:59 am

      It’s tough to feel rich because you normalize so quickly. This is especially true if the net worth is on a slow and steady path. If we see a sudden jump, I think I’d feel rich at least momentarily.

  • Max Your Freedom February 23, 2017, 5:54 am

    I think I would feel rich when I had the kind of net worth that would allow me to freely pursue anything I wanted, without feeling guilty about holding down a job to support my family. Basically when I can spend without worrying about money. Like you, I have a decent net worth, but still haven’t reached that point. It’s not about being content. I feel like we have a great life, and we’re grateful for it. It’s about the underlying stress associated with looking after money related aspects of life. If I could live life care free with respect to money, then I believe I would feel rich. Ironically, you can take the extreme of having no money or possessions and living like a monk (literally….check out Chef’s table Season3 E1 on Netflix), and that would solve the same problem.

    • retirebyforty February 23, 2017, 10:03 am

      That show sounds great. We don’t have Netflix, though. 🙁
      I’d like to try being a monk for a few months. It will be interesting and I can blog about it.

  • Fred February 23, 2017, 5:55 am

    The day I paid off my mortgage. An extra $800 a month!

    • retirebyforty February 23, 2017, 10:03 am

      Good goal!

  • Mike Drak February 23, 2017, 5:59 am

    Joe I love it when you come out with questions like this. I really need to ponder more on the subject but to me rich equates to personal freedom not some level of capital. Did I feel richer as a 20 year old or now in my current position? I’m leaning towards my younger self because I’m concerned about my current fixation with the stock markets etc. The pursuit of more wealth has become a bad habit for me. I can’t understand why I feel the need to check on stock prices multiple times a day on my iphone. There is no need for that because I’m a long term investor so why do I allow daily market movements to impact my happiness. It doesn’t make a lot of sense to me and I need to stop doing it. It all about quality of life and focusing on what’s really important. When I start to lose focus o remind myself about the story of the Mexican fisherman. That is a person who is truly rich!

    • retirebyforty February 23, 2017, 10:06 am

      You need to stop worrying about the stock market. 🙂
      I definitely feel a lot richer than I was 20. I worried about money a lot more back then because I didn’t have any. Life is much better now and I’m very grateful.

  • Sam @ Financial Samurai February 23, 2017, 6:13 am

    $2M+ net worth? You guys are rich! That’s like $5M+ or more here in San Francisco. Did you start producing a net worth report too?

    I donno Joe… having the Mrs. still grind away while the net worth is $1M each seems like you guys are holding on to the rope when you’re only a foot off the ground!

    • retirebyforty February 23, 2017, 10:10 am

      I only do net worth every year or two, not too often.
      I’m ready for her to stop working, but she still doesn’t feel secure enough. She doesn’t believe me when I say she can ER. The health insurance coverage sure is nice, though.

  • [email protected] February 23, 2017, 6:14 am

    I feel a lot like you do Joe and I really like posts like this! We live a lot like you – middle class but not “normal” I guess. Used cars, free or low cost entertainment and we spend money on travel. People still keep wondering how I am retiring early (at 50 – not 55 when educators in my age group normally can retire). I think they still believe I won the lotto or have a huge inheritance. I found this quote this summer by author Harvey Mackay and this pretty much sums up how I feel now – “Being rich isn’t about money. Being rich is a state of mind.” I feel pretty rich right now – and hope I always do!

  • Retire Before Dad February 23, 2017, 6:38 am

    Joe,
    The one time I’ve felt rich in my life was when both my wife and me we’re working full-time and we had a net positive cash flow of $5,000+ per month. We stashed it all away to put a down payment on a house.

    When cash flow is that healthy like that, you can take a quick $2,000 vacation on a whim and still have lots of extra cash to invest every month.

    Now that we’re on one income and Mrs. RBD stays home, we don’t feel rich at all, even though our net worth is 3-4 times higher than it was during that period of high income.

    Never thought of it that way. I might have to elaborate in a post.
    -RBD

    • retirebyforty February 24, 2017, 8:50 am

      It’s nice when cash flow is healthy like that. I felt wealthy too when our positive cash flow was higher. Now, the cash flow is too close to equilibrium so we keep a close eye on our expenses.

  • Brian February 23, 2017, 6:40 am

    Joe,

    In my humble opinion, you’ve got one of the best Early Retirement/Financial Independence sites out there. Love your work. Great job.

    • retirebyforty February 24, 2017, 8:50 am

      Thank you! I really appreciate that.

  • [email protected] Turtle February 23, 2017, 6:48 am

    I have a long way to go before I’m rich or even financially independent. When would I feel rich? It’s hard to say right now because it’s going to be years before I get there, but I would think I’d feel rich at 2 million.

    My FI number is only $500k, so having four times that amount would make me feel very rich.

    Awesome post for not having a plan! 🙂

  • Mrs. Picky Pincher February 23, 2017, 7:01 am

    My personal definition of “rich” is living beneath your means with a positive net worth. We have a long way to go with eliminating our debt, but it’s happening. I’ll feel rich once we have a positive net worth. We already save over 50% of our income and live beneath our means, so we’re well on our way. 🙂

  • Felipe February 23, 2017, 7:06 am

    It’s definitely not a dollar amount. It’s a state of mind. I do like “wealth” more than ‘rich.” I’m 52 now. When I was 20 I rode the public bus in Mexico City daily. On the bus I felt rich, at the school I felt poor. Most of the students were from quite wealthy families. Then, in TX, I was a butler for two years. That put any idea of wealth in a new light. I saw that money and things don’t make people happy once you have what you really need. Now, I’m healthier than most of my friends, I don’t drink much or do drugs to numb my life as some of them do. I live in a simpler house than my friends, drive a much simpler car than my friends, and take much more modest vacations than my friends. Yet I feel much richer than they are. They’re still a slave to their job. I still work, but I don’t have to. They have to and will have to for many years. Answer is that I’m rich now. The money helps me feel that way, but measure yourself on a global perspective. Most of us on here are way wealthy. We should be happy.

    • retirebyforty February 24, 2017, 8:52 am

      That’s a great perspective. This is why we travel. It’s good to see how the rest of the world live. We have a very comfortable life here in the US and it’s easy to forget how good we have it. Thanks for sharing.

  • Martin Stone February 23, 2017, 7:15 am

    Great article. I am retired early have a net worth >$4 million and live of the income it generates. However the income matches expenses, therefore I don’t feel “rich”. What will it take to feel rich? I don’t think it is any of the items listed in your poll although not having to worry about money would make me feel rich, but I will always worry about money – that’s how I reached the position I am at today where I have retired early. When our youngest completes college in another 5 years time, my net worth is still the same and income becomes greater than expenses I will feel rich. As my financial adviser says “you probably feel like the poorest multi-millionaire right now!”

  • Jax February 23, 2017, 7:24 am

    Though my net worth isn’t nearly as large as yours, I feel like I am “on paper” rich. I have plenty of assets (mostly real estate and retirement accounts) that if I could make liquid if I really needed. But my monthly cash flow is where I feel poor. This goes against everything the personal finance community preaches and believes (at least it feels like it) but I will feel rich when I can go out to eat whenever I want and not feel guilty that my money isn’t going toward a goal or savings. I apologetically love eating out even though I know it can be a waste of money.

  • Ms. Montana February 23, 2017, 7:32 am

    I do feel rich. Very rich in fact. Our net worth isn’t very high (about 600k) but our passive income covers all our bills. I never think about how to pay our living expenses. Really in most of our choices, money isn’t the consideration. I feel rich enough to give money away. It was actually our largest “expense” last year. While it feels like everyone around me lives in the “real” world of jobs, bills, slowly trying to get ahead, in some ways, I feel completely removed from it. A friend just asked about how profitable a new project I started was, and I realized that was about the 8th most important question to me, so much so I hadn’t given it much thought. But it was her first and only question. Money makes so few of my choices now. And plays such a small part in the choices I do make. Which feels like a crazy rich privileged way to feel.

    • retirebyforty February 24, 2017, 8:54 am

      Great job with your passive income. Not having to worry about money is very freeing.

  • Mr Crazy Kicks February 23, 2017, 7:50 am

    I’ve been thinking about this a lot lately. While I can’t buy any expensive toy I want, I do have complete control over my time now. But even having all the time pursue any hobby I want, some days I’m happy, and some days I’m sad. On the days that I do feel down, I can’t think of anything money could buy that would change my situation.

    While I still don’t feel super rich, I do feel like I can now relate to the multimillionaires and billionaires of the world. In a way life is probably even more frustrating for the super rich. The more you have the more pressure there is to feel happy all the time, and yet money isn’t going to generate happiness. This is probably why people end up in that cycle of chasing more money without finding contentment.

    • retirebyforty February 24, 2017, 8:56 am

      Thanks for sharing. I’m too busy to feel sad now, but I can relate. The weather is really bad this year and I get mad at our kid easier than normal. I’m so ready for nicer weather. It’s really affecting my mood this year.
      I think life is frustrating for the super rich too. They have to keep trying to make more money. This is why I don’t think it’s a good idea to put wealthy business people in office. They are rich, but they always want more.

  • Roseanne February 23, 2017, 8:25 am

    Rich? Is money your only definition? I am rich beyond my wildest dreams with friends and family; a job I absolutely love; a car that gets me reliably to that job; I have a house that is paid for so I am able to really sock away money; I have a niece that is expecting her first baby after trying for a while and miscarrying. I am rich!! ~smile~ Joe – buy that mattress. You deserve it. Best wishes – I love your blog!

    • retirebyforty February 24, 2017, 8:58 am

      Yes, just money for today. 😉
      Great job paying your house off. It sounds like you have a very good life. Congrats! You’re rich!
      I will buy that mattress. soon…

  • David Michael February 23, 2017, 9:19 am

    I feel rich (age 80) when: I am in excellent health, have no debt, choose to work or not, have the freedom to travel whenever and wherever I want, share life with a loving partner who is my wife, boondock (dry camp) with van or RV in our western USA public lands, and finally, go flyfishing and kayaking on our beautiful lakes. Money…we live on $36,000 a year, that’s $3000 a month. That’s it. It would be great to have millions I suppose, but to be realistic, it’s not necessary. Each healthy, loving day is a gift.

    • retirebyforty February 24, 2017, 8:59 am

      I think health is key at any age. If you’re not healthy, it’s difficult to feel rich.
      You have a great attitude and I hope we’ll be in your shoes someday. Thank you for sharing your wisdom.

  • Dan February 23, 2017, 9:20 am

    I think there could be a bit of geographical disparity because of cost of living differences. $1m, according to people I’ve talked to in the mid-west is still the goal. Some people in NYC and similar places have said that they think they need $5m+. I’m in my mid-20’s and I’m kind of fearful that when I get to $1m that the goalpost will change. Maybe in 20-30 years the goal will be $2-3m and cost of living a middle class lifestyle will be $100k.

  • Dividend Diplomats February 23, 2017, 9:45 am

    RB40 –

    I think feeling rich to me would be no money worries, reduction of fixed expenses to have an easier sense of financial freedom and choosing to do work for the community for things you love to do ; as well as the free option to spend time with your loved ones when the time permits!

    -Lanny

    PS amazing post.

  • Mike H. February 23, 2017, 10:04 am

    I’ve always thought of it as a formula. 100% of savings goals + 100% of lifestyle goals + 100% of charity goals = rich. So it’s also a moving number. Alternatively, you could think of it as “being able to money on something without sacrificing anything else.”

    Right now I’m around 50% savings goals and 50% lifestyle goals. I won’t even share what my charity contributions are because it’s so embarrassingly low. So no, I don’t feel rich.

    • retirebyforty February 24, 2017, 9:00 am

      I suspect that’s too much math for most readers. 🙂
      I like it though. We’re probably at 100/70/10 right now. Terrible…

  • Revanche @ A Gai Shan Life February 23, 2017, 10:30 am

    If nothing was changing, I’d feel almost-rich today: We aren’t too far from paying off the mortgage, we’re saving a great amount each year between our cash savings and retirement investments. We can afford the things we need and some things we want right now. We’re in a pretty good place but we’re not rich yet because when our circumstances changed, we weren’t able to just roll with it.

    Now that we need a large loan to buy a difference, safer, place to live, I feel poor again. I’m like a prematurely awakened hibernating bear being forced to move caves – it’s inconvenient, bad timing, costly.

    To feel rich, then, I’d need a combination of factors, any 2 or 3 of your choices offered would do the trick:

    Having a net worth above a certain amount – Maybe $5 to 10 million
    Making more than certain amount – $400k/year? Yes I’ll take that
    Moving to a location where your money is worth more – well, I don’t actually want to move but I do want our location to be one where our money is worth more
    Retiring comfortably without having to worry about money. – that’s very connected to the first one about the net worth.

  • Acastus February 23, 2017, 10:56 am

    My FI target is to be independently middle class. My target annual income is roughly the Scott Burns “Life of Riley index” value of 75 %ile household income. That does not feel rich to me, just similar to my working life. I don’t plan to become rich, though many others may consider me so when I get there. Rich would be having double that wealth, or maybe having an extra $50k per year of mad money.

  • jim February 23, 2017, 11:14 am

    http://cnbc.com/id/48240956

    “The question of how much people need to feel rich has been studied for ages, and just about every study comes to a similar conclusion:

    people need twice their current net worth or income to feel wealth.”

  • Stockbeard February 23, 2017, 11:33 am

    I thought about it recently as well. I have a few specific levels in mind:

    1) Kind of Financially independent (where I’m now): with my investments (using 4% rule) + my side gig, I cover our expenses.
    2) Financially independent: my investments cover my expenses with the 4% rule. The side gig becomes gravy.
    3) Rich: My investments are double what I’d need to cover my expenses. This situation can be seen in a few ways: Only use 2% of my investments instead of 4% (basically mostly covered by dividends), or I have half of my investments on my brokerage account, the other half in a more stable place. This is especially true since long term I intend my investments to stay in a US broker while I’ll be living in another country. In such a situation, I’m adding uncertainty to what will happen to my money so I feel I’ll need a backup. Having the other half of my money in the other country would allow me to still be financially independent, even if I lost everything I have in the US.

    So, bottom line, I’d feel rich if I could cover my expenses with a 2% rule instead of a 4% rule 🙂

    • retirebyforty February 24, 2017, 9:04 am

      We’re between 1 and 2 right now. Hopefully, we’ll get to 2 in a few years.
      Wow, double expenses. I think that would be it. It would be tough because most people will spend more as their income increase. Moving to a cheaper location might do the trick.

  • Dan February 23, 2017, 12:16 pm

    I know how you feel. We are near $1M invested in assets, plus over $200k in home equity. However, in order to travel, we have started travel hacking. The idea of spending money on travel, even though we have done it, makes me cringe. I do plan on retiring in the next year or two, to join my stay at home wife, but I don’t think we’ll ever feel rich.

    I am OK with that. Having enough money to enjoy life and sleep well at night is all I have ever aspired to. Quitting the corporate world is likely to make me very happy.

  • Simon Chan February 23, 2017, 12:44 pm

    Great article Joe, very thought provoking. I think the word “rich” is truly a personal definition and much of it is depending on your background and current reference points (e.g. social peers). A question that my father asked me a few years ago help me understand that I had enough which isn’t necessarily rich. He said “If I gave you $100K right now, what would you do?”. I thought about it for a bit and responded that I would take a trip with my wife and son which might be $10K max and then I would save the rest. My father’s response was “Then you’re rich and money is no longer an issue if you don’t have any new wants”. I think being rich is a mindset and personally I need to work on shifting to an abundance mindset vs. a scarcity mindset. The scarcity mindset has helped me reach financial independence but now I need to mentally transition to enjoying the wealth that I have saved.

    • retirebyforty February 24, 2017, 9:07 am

      Thanks! You gave me a topic idea. What would you do if you get $100k windfall. It’s not a huge amount, but just enough to splurge a bit. (Or a lot.)
      I never liked the abundance mindset. I don’t think it’s valid for everyone. Not everyone can make an abundance of income, but everyone can be frugal. It only works for certain people.

      • Simon Chan February 24, 2017, 6:09 pm

        Glad I was able to help with a new idea for a topic, I look forward to reading it and the comments. I agree entirely that everyone can be frugal and that not everyone has the opportunity to have an abundance of income…I think the abundance mindset is more about being generous, open minded, and being grateful for what you have.

        • Joe February 26, 2017, 8:40 pm

          I think the $100k windfall is not enough to make a difference to you so that you only chose to spend 10% of it. I think you would be able to think of much more to spend on if the figure were $5 million or $10 million.

  • Justin February 23, 2017, 1:14 pm

    I’ll be honest. I feel rich. 🙂 We have $1.6 million plus a paid off house and car. We do what we want most of the time and don’t really want for material comfort. If we want something, we research it to get the best value for our dollar and buy it. Today we discussed moving somewhere else just to be closer to walking trails and the greenway and it’s great to know we could do that without worrying about financial impacts.

    We travel all the time, and though we focus on value travel, we could spend more if we wanted to.

    Objectively we’re pretty well off. I think to move to the next tier of “rich” we would need $8-10 million or more. Then we might be looking at private jets, a lot more hired help, outsourcing virtually all tasks that aren’t pleasant.

    • Joe February 24, 2017, 1:01 am

      $10 million isn’t nearly enough to consider private jets. More like $50 million+…

    • retirebyforty February 24, 2017, 9:08 am

      More hired help would be my rich threshold too. Private jet seems unnecessary. 🙂

  • greg February 23, 2017, 1:52 pm

    Joe, my numbers are similar to years (net worth, etc), except I am still working at ~$150k/year. Despite having a good income, little debt, no mortgage, and 6 rental properties, I still feel poor. I still have a $120,000 remaining on a line of credit I used to buy some rental properties, so all my excess cash goes into paying this loan down to zero.

    I don’t want to owe any money to anyone. All assets, no debt. I also drive older cars paid for with cash.

    Maybe once the loan is paid off and I have excess cash building month to month, I will feel rich. Right now if I have $5000 in the bank it just gets transferred to the loan.

  • We're All Poor Here February 23, 2017, 2:57 pm

    What would make me feel rich is having everything that I want. Luckily, that list is very small. It used to be just a dream but as I continue to crush debt and be frugal, it’s becoming closer and closer to a reality. The only thing I’ve ever wanted in my entire life is my own place. No family, no roommates. I’m so close to having it that I can almost taste it. It’s an exciting time for me.

    Great post. Look forward to reading more.

  • Ken_Kash February 23, 2017, 3:11 pm

    Great topic that obviously has generated quite few comments and hard to add to the many great perspectives so I’ll keep mine limited to 4 simple items.

    I’ll feel rich when I can….
    …take on a job whenever I want and on my terms regardless of pay
    …always have time to enjoy time with family
    …leave a family legacy
    …have enough time or money to make my community a better place

  • Michael February 23, 2017, 7:43 pm

    This is my 2 cents:

    Feeling rich is a mindset. The definition of “rich” varies from person to person. A person could rich if they have retired with good health and have a decent nest egg so that he / she doesn’t need to worry about going to work anymore.

    One could feel rich if their money decisions aligns with their values and priorities. “Rich” is not a far away intangible. It is how well your earning / saving / investing / spending is aligned with your values and priorities.

  • Smart Provisions February 23, 2017, 11:20 pm

    I don’t know if I want to feel rich, I probably would want to feel like I have enough. Then again, having an overabundance of anything would make me truly rich in that aspect.

  • Joe February 24, 2017, 1:05 am

    I will feel rich when I stop reading financial blogs because I felt I had nothing left to learn financially speaking, or the knowledge I was picking up from them seem inconsequential compared to my assets/income. 😉

    • retirebyforty February 24, 2017, 9:09 am

      That’s a good one. Hopefully, we’ll get there by the time we’re 65. I can just relax and not worry about the financial blogs. 🙂

  • saveinvestbecomefree February 24, 2017, 7:52 am

    I think the problem is the mental association with the word “rich”. Many people including myself envision extreme wealth, where money would never be a factor. But the things I think of being able to buy if I was “rich” are not really things I truly want. At very least, not having those things don’t bother me when I really reflect on it. Being truly FI, especially early in life, with a standard of living you enjoy is pretty amazing. I think we should consider this to be true wealth. You don’t need a private jet and personal island to be “rich”.

  • Retiresoon February 24, 2017, 4:33 pm
  • Rich @ pennyandrich.com February 24, 2017, 8:08 pm

    Interesting — Rich is my pseudonym but I’m not sure if I am rich or feel rich. Words can be redefined, but in general I agree with the idea that being “rich” and being financially independent sound like 2 different realities. You can be financially independent living in a trailer in Mexico. Not rich.

    Rich, to me, implies luxury. When we go skiing, we feel rich (temporarily) because we stay in a hotel right by the gondola, our skis in a heated waiting room, fireplaces roaring, views of the mountains, etc. That’s when I pinch myself and say I’m rich. For a few days at least. Then we go back to our regular (upper) middle class lifestyles.

    But, I’m still working. It’s a trade-off. For early financial independence, you might have a high net worth but you trade income and luxury for frugality and time (away from traditional work). Personally, I don’t mind work + income so I can have moments of luxury. But I don’t overspend to the point of ruin.

    I’ll be honest — an obstacle to FIRE for me is that I’d need to live really frugally in order to continue to live really frugally. I’d be essentially freezing my lifestyle. Maybe this is a false dichotomy — what do you think?

    • Joe February 26, 2017, 8:35 pm

      I’ve been in FIRE for 10 years. For most people in FIRE, the lifestyle would definitely be frozen. No more upward mobility so you should be happy where you are when you FIRE. I am referring to true FIRE where there is no more active income and you no longer hustle at all for more $$$.

      • retirebyforty February 27, 2017, 10:06 am

        Exactly! You should be happy with the current lifestyle before pulling the trigger. IMO, living super frugally probably won’t cut it for the long term.

  • Mustard Seed Money February 25, 2017, 4:53 am

    I definitely don’t feel rich. Mainly because if I felt rich I wold be spending time on things that I enjoy vs. trying to earn money. So I’m still trading time for money. So until I feel like I can trade money for time I probably won’t feel rich.

  • Make Wealth Simple February 25, 2017, 6:18 am

    I agree with your last paragraph, on how your 20-year old would be amazed by how well you did. That is really nice to read.
    I’ve also done quite a bit better than i imagined i could at 20. But still have a long way to go. Reading all these posts and blogs motivate me and comfort me that with time I’ll get there.

    And never forget, anyone living in he West –> you are already rich.

  • Abby February 25, 2017, 1:33 pm

    An interesting post, really didn’t know what to expect reading it, and was happy to see your last paragraph. Agree with others who say many of the bloggers who your levels of net worth could be considered “rich” or “wealthy”. Really liked reading the comments of Ms Montana. Like Ms Montana anytime I have more than enough to spare and share feels really great! I also liked the concept Simon Chan mentioned – about an abundance mentality – is that a topic you may write on or maybe if Simon visits again could write a guest post 🙂

    • retirebyforty February 27, 2017, 10:03 am

      Thanks. Sometime, we just have to take a step back and appreciate what we have. 🙂

  • Fiscally Free February 27, 2017, 2:18 pm

    I realized after reading this that I don’t really have any desire to be rich. As long as I can maintain our relatively modest lifestyle, I’ll be happy, and that definitely doesn’t require me to be rich.

  • Mr. RIP February 28, 2017, 4:39 am

    I’d feel rich if I have a NW 2x my estimated FU Money (2 millions Euro).
    I won’t act as a rich though, except “not having to go to work”.

  • Diva Q March 1, 2017, 11:57 am

    My definition of rich is when I don’t have to worry about my budget on all of the needs, able to spend on the wants, after saving 50% of my gross income. I’ve been able to save 50% of my income since my 1st job in 2008 at $26K a year, I doubled that salary 5 years later, and reached 6 figure income after 10 years of working, and today, after 19 years, I’m making $200K+. I’ve been able to have a lifestyle inflation along these years but still able to save 50% of my income and reached FI a few years ago.

  • cbaggy August 21, 2017, 1:11 pm

    If you have $1,000 per month of discretionary cash, why don’t you buy yourself a better mattress for crying out loud? You spend 1/3 of your life on your mattress. Stop being cheap, man. Spend 1 month of your discretionary on a mattress. You can thank me later.

    • cbaggy August 21, 2017, 1:36 pm

      Oh, and by the way, I will feel rich when my house is paid off. Then I know we could survive on a $7.50/hour job based on our budgeting spreadsheet. That makes me feel rich. It’s almost paid off. <1 year left. I'm 35.

      We are frugal in terms of lifestyle. We buy things, but it tends to be similar to what you listed. A few consumer electronics. We buy the low end cell phones. Moto E4 is a very good phone! Got that after 2 years of Moto E2, for example. 1 TV. 1 car. Used bikes. etc. This is what it takes to really get ahead in life and feel in control of our finances so we suffer zero stress on that front.

      PS I need a new mattress too…

    • retirebyforty August 22, 2017, 10:06 am

      I don’t want to move it when we move. I’d rather throw this one out and get a new one when we move.

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