The reason only 13% of millionaires feel wealthy

A new Ameriprise Financial survey of more than 3,000 U.S. adults ages 30-69 with at least $100,000 in investable assets, including more than 700 millionaires, suggests that wealth is a pluralistic term. For some of the respondents, the distinction is conditional and dependent on factors like location and financial priorities, for others, wealth is defined by the manner in which it is achieved.

In nearly every case, however,  seven-figure earners preferred the term “upper-middle-class” as opposed to “wealthy.” Roughly a quarter allowed the classification of “middle-class,” and less than 3% went so far as to label themselves poor.  On balance, Americans believe that it takes at least $2.3 million in personal net worth to be considered “wealthy.”

How do you define wealthy?

A mere 13% of people who have $1 million dollars or more in investable assets consider themselves wealthy.

“Building wealth is often a complex journey,” explains Marcy Keckler, Vice President of Financial Advice Strategy at Ameriprise. “The reality is even people who have accumulated seven figures juggle many financial goals, wants and needs. It takes careful planning for investors to reach the financial milestones they’ve set out for themselves, even for those who’ve built sizable nest eggs already.”

Some degree of forethought seems to contribute to the reliable accumulation of wealth,  though the respondents were halved by how rigidly they adhere to financial planning (55% plan exhaustively, 46% have a general idea.)  Just about 4% of millionaires report achieving this status by the seat of their pants. The occasioned financial objectives varied even more dramatically by generation, barring retirement, which was found to be a number one priority across the board.  Millennials and Generation Xers both sought to use their wealth to liquidate their debt, while boomers were more concerned with protecting their assets and fiscal security. 

“Our research reveals that these investors are taking a long-term view of their finances – and the fact that they all cite saving for retirement as their top priority, regardless of where they fall on the age spectrum, points to this trend,” adds Keckler.

The new currency

This variability additionally extended to values. Millennials, much more than previous generations, rate experiences higher than possesions. More specifically, this generation measured wealth by the degree of freedom it permitted them to indulge in their interests. Just a tad under half of the respondents said that their approach to investing was antithetical to their parents. This estimation proved to be the starkest when applied to the basic function of accumulated wealth. The current herd of investors believes it’s prudent to align your financial decisions with your life goals-the magnates of 10 years ago employed a very different philosophy, one that felt segregating personal interests and business acumen was the key to securing both.

“The bottom line is that successful savers and investors – whether Millennials, Generation X or Boomers – may be more alike than different when it comes to managing their finances, contrary to popular belief,” says Keckler.

According to a new Charles Schwab Modern wealth survey, 33% of Americans confessed to modeling their impression of wealth on images and experiences shared by their friends on social media in addition to spending beyond their means by reason of FOMO-this was especially true in Gen Zers. Despite this, 59% of all respondents report living paycheck to paycheck.  Alongside a warped approximation of what “wealth actually is, property costs accord the irresolute interpretation. This factor is a reasonable one. For example, San Fransisco residents, raise the wealth bar at $4 million, while New York residents place it at around $3.2 million.”