Social Question

ARE_you_kidding_me's avatar

What constitutes being "rich" or "wealthy"?

Asked by ARE_you_kidding_me (19833points) December 21st, 2016

What income, assets or resources would you consider make someone rich?

Observing members: 0 Composing members: 0

49 Answers

MrGrimm888's avatar

It’s subjective.

To me,you’re rich,when your disposable income is higher than an average person’s total income.

You’re wealthy when you have too much money to even realistically spend. And you’re family will be wealthy for generations following your death.

The wealthy would kill themselves if they were rich.

Our president elect is so wealthy that living in the Whitehouse (the residence of the most powerful person in the world ) will be a big step down in luxury….

elbanditoroso's avatar

I don’t think there’s a simple formula as to “rich” or “wealthy”. It’s always in comparison to something else. I think that the key is how much the person (or family) exceeds the ‘normal’ level of income for the group being compared.

There are many examples; let me touch on two:

1) let’s say that a person makes $50,000 year. This person has relatively low expenses and has enough money to live, comfortable, bank a little, and take a European vacation every summer. The people in this person’s neighborhood are all minimum wage people who barely have the money to pay their rent and buy food.

This person – in comparison to the neighbors – is wealthy, because in comparison, he has a more comfortable lifestyle. Is the person rich? no. But he’s richer than his milieu.

Example 2: Family makes $400,000/year. After taxes, $350,000. But they have a large mortgage for an expensive house. And they have three kids in college and one in grad school. Their expenses – tuition, food, healthcare, living, etc – add up to $345,000. They can’t bank anything because they pay it all out.

Are they wealthy? Compared to me, yes – I don’t make anywhere near $400K/year. But are they rich – not a chance. They spend everything they have.

So you can’t define either wealth or richness by themselves. They have to be measured against something else.

josie's avatar

Depends on whom you ask.

Wealthy to me means that I can afford to pursue happiness without the worry of defaulting on my obligations right up to the day I am gone. I believe that this represents reasonable and morally proper self interest.

To others, it is the ability to exert power capriciously. It is the capriciousness that makes this level of wealth a subject of moral debate.

Love_my_doggie's avatar

Income = resources received, in exchange for providing goods or services and/or through investing capital.

Wealth = what’s owned, less what’s owed. “Rich” means wealthy – someone who has substantial net assets relative to other people within a reference group.

The two concepts are often confused, because they can work hand-in-hand. Yet, it’s not unusual for a person to have a very high income and no wealth, or for someone else to be very rich with little income.

marinelife's avatar

There is no set definition. I think that I am wealthy in family, friends, and home.

Mariah's avatar

Having more than what you need to live comfortably, which varies from person to person.

If you have high medical bills or a lot of kids, you might not be able to live on a 100k yearly income. But most people can. That’s why I can’t just put a number on it.

JLeslie's avatar

I think rich is really hard to define. Wealthy to me is when you have so much money and wealth you never have to work again. Even that is tricky. My dad said to me years ago he feels “wealthy.” He owns his house outright, he gets a pension that can cover his expenses, and he has free medical care. I think wealthy for him was not having any money worries regarding basic needs. He made a nice salary back when he worked in his career, but was never rich, but in his retirement he feels “wealthy.” But, that isn’t wealth he can pass down to me. It isn’t family wealth like the upper class has.

@MrGrimm888 You wrote:To me,you’re rich,when your disposable income is higher than an average person’s total income.

Let’s use household income if that’s ok? Or, do you only want to use personal income?

Let’s say a couple makes $150k, takes home $110k and their necessities cost them $60k a year. By your definition they are rich. They might still be spending another $10k-$20k for restaurants, a vacation, a movie now and then. I’m not counting that as a necessity. I’m also not counting a new phone every few years, or things like a dress for a special occasion, fixing a car that breaks down, etc.

MrGrimm888's avatar

^Yes. I consider a person clearing 100k a year rich.

60k in “necessities” seems skewed. If I needed 60k a year to live,I’d have been dead long ago. I currently scrape by on 10–20k a year. Depending on the year…

If my Obama care is revoked, my life will be even more challenging…

I suppose you could call me,envious, jealous, and or resentful of the wealthy.

The rich I don’t mind unless they act entitled…Which ,of the the rich I know, is about half.

As most have opined,yes, it is hard to classify rich and wealthy.

ARE_you_kidding_me's avatar

100k a year is not even upper middle class. It’s probably enough to support a typical family and the parents still be able to pay for college, retire and live a very modest life without many frills like fancy cars or vacations.
For a single person though, it’s more than enough.

Mariah's avatar

Removed by me

janbb's avatar

@ARE_you_kidding_me Many private and even public colleges now cost upwards of $40,000 a year. Hard to pay for on even $100,000 a year.

MrGrimm888's avatar

I suppose it’s slightly off topic, but I am rich in family. One of the richest people I know.

ARE_you_kidding_me's avatar

@janbb I agree and 100k in a big city is different than in a different part of the country. Where I live 100k puts you in the middle of the middle class. It’s the typical salary for a mid-career professional in this area. It’s enough for a family provided there are no frills.

Cruiser's avatar

Rich is a number, be it on a savings account, a brokerage statement or what Zillow tells us our house is worth. If it’s larger we can buy more things; if it’s smaller we can’t buy as much. Simple.

Wealth or being wealthy is more complicated. It is a sense of security no matter how much or how little you earn. It is what allows you to make choices in life, whether you’re a school teacher or a hedge fund manager.

Being wealthy isn’t the same as earning a lot of money. Often those two do not align, which may shock some people who are just scraping by. The key to being wealthy is the choices and decisions we make every day coupled with the behaviors we have around money. Wealthy folks are incredibly disciplined with their money and they can be very frugal and even stingy. And these behaviors are not confined to how we invest money; they radiate out to everything that money touches, from how much we pay for our home each month to how often we eat out to what or when we decide to spend on our children’s education or a charitable appeal.

ARE_you_kidding_me's avatar

I’m not really going to disagree with what has been said but when people call out those who are “wealthy” as being in the class that is accumulating wealth and everyone would consider them “rich” where is that line to be drawn? When does it stop being subjective to you?

janbb's avatar

I think wealthy is what people call themselves rather than rich to sound more classy.

As to what constitutes rich, I’m not sure there is a hard and fast rule. As others have said, a lot depends on what you spend as well as what you have although choosing to live in an expensive home and drive expensive cars is surely a prerogative only of the rich.

ARE_you_kidding_me's avatar

When people say they want to tax or redistribute wealth from the rich to the less fortunate where do you see those lines.

kritiper's avatar

Heap o’ wampum.

elbanditoroso's avatar

@ARE_you_kidding_me – I have never liked the phrase “less fortunate” because of the connection to the word ‘fortune’ which implies luck or chance.

“Less well off” or “lower income” would seem to be a more accurate word,

janbb's avatar

@ARE_you_kidding_me To answer your new question, one thing I would like to see instituted is that CEOs can only make a certain multiple higher in salary and bonuses than the average worker salary in the company. The resultant profits would be distributed to the workers as higher wages. This will never happen in the USA but it seems fair to me.

Another way is to raise corporate tax rates and raise the social safety net but again that’s not happening.

ARE_you_kidding_me's avatar

If you raise corporate tax how do you keep them here? I agree with CEO pay but how do you enforce it? How do you keep them from paying themselves in other ways?

MrGrimm888's avatar

@ARE_you_kidding_me . “Redistribution” is a word selfish people use to describe taxes…

Taxes are obviously a necessity to run a country. Right?

Those who have more,should give more. Simple.

I kind of think of taxing the wealthy as donating blood.

When a normal, healthy person donates blood, they do so because they have such abundance that a fraction won’t hurt. In fact it’s renewable.

Paying higher taxes because you happen to have more money(in large part because you’re in the US, and take advantage of its financial/tax laws) should seem fair.

Lets do a thinking exercise.

Let’s say myself and 99 other people in a company were required to carry 500 2×4×12’s from spot A to spot B.It needs to get done for the job to continue.

Of the 100 people, there are many different body types.

I’m a big guy. Let’s say I could easily carry 10, but because most can only carry 2, I only carry two… Claiming that I shouldn’t have to do more because others aren’t asked to lift more,than they can carry…

The country (especially a democracy ) is a team.

Teamwork means each member contributes as much as possible in their own way for the greater good.

If I’m unwilling to carry more wood because I can,it’s not illegal, but it makes me a dick… There may be another job where my size works against me, like on ladders. On ladders I’m slow and the smaller/normal sized guys are faster,safer,better.

Taxes have a purpose. And the wealthy/fortunate are in position to help the country /team better .

A lot of people act like the taxes from the wealthy go straight to the poor. Ha! If only….

The taxes go to the government and it’s “leaders” distribute it to many different agencies like the EPA, FDA to name a couple.

Obama doesn’t take the money and “make it rain” in the ghettos of America…..

ARE_you_kidding_me's avatar

Nobody is answering the question, where are the lines?

MrGrimm888's avatar

Like I said. The taxes go to the whole country. The money has to come from somewhere.

janbb's avatar

@ARE_you_kidding_me I don’t think anyone knows where the lines are but it certainly seems like the top 1% or perhaps 5% (or perhaps 20%) should pay a higher rate of taxation.

JLeslie's avatar

@Mariah I feel like you’re not accounting for rainy days and old age. You need to make more than you need now to take you through paying expenses when you no longer earn an income. That can be job loss, illness, and retirement. Unless you don’t believe in retirement, some people don’t.

Mariah's avatar

I guess I was including putting away necessary savings as a part of “living comfortably,” @JLeslie. I define richness as having more than enough to cover your needs including your need to set aside a reasonable quantity for retirement.

@ARE_you_kidding_me I don’t think there is any one “line” that’s why I support a system in which people are gradually taxed at a higher rate as their income increases, and provides breaks for things like quantity of children.

ARE_you_kidding_me's avatar

So… since people won’t really draw any hard lines here how can we take all of this angst against “the rich” seriously? Here, I’ll draw my line: quarter million dollar salary and/or five million dollars in assets. Beyond that is wealth that is way more than anyone needs. If people want to tax “the rich” this is where I feel like it should start.
@Mariah, yes I know it would be gradual but still the question remains, where should the line be drawn between rich and not rich.

Mariah's avatar

I don’t see the same need to define some hard cut-off point? Even with the example you give, if the person has with huge medical bills and can’t get insurance coverage they could still be struggling in that situation.

JLeslie's avatar

@MrGrimm888 Tegarding Obamacare, if you make $60k a year you don’t get any of the discounts that people in lower incomes are eligible for, so your health insurance costs would be higher.

I think most people who make $20k-$30k, if they started making $50k-$60k would change their lifestyle. They wouldn’t just pocket all of the extra into savings. So, now you move to a more expensive apartment or house and maybe upgrade your car. Now your expenses are higher. Your living on $40k gross let’s say, and then spending a little more for fun, and saving more too.

If you are married or live with roommates that bring in money and help pay bills the money calculations change. Living alone is very expensive.

Edit: when you go from $60k to $80k you’re more likely to not make any changes in your “necessities” expenses.

ARE_you_kidding_me's avatar

@Mariah Ok playing along, how should that tax curve be shaped? Who makes that determination, Who gets to decide where the exceptions are made?

Mariah's avatar

I am not a statistician and do not have the data in front of me.

However I’m a big fan of the current system of having only the portion of your income that falls above a certain bracket be taxed at the higher rate. That is – making up numbers here – the first $25k of my income could be taxed at a rate of 10% while the amount that is about 25k but below 75k could be taxed at 15% and the amount that is above 75k but below 150k could be taxed at 20% and the amount that is above 150k is taxed at 30%. This ensures we don’t run into any stupid situations where someone who makes 51k annually is actually making less take home pay than someone who makes 49k because of taxes.

That’s a general idea, but I couldn’t actually solidify those numbers for you without having a lot of data in front of me and having statistical skills for analyzing it.

ucme's avatar

Does tipping the butler double the amount of cash he uses to wipe my shitty arsehole count?

Hypocrisy_Central's avatar

Simple to me, wealthy is when you can earn more while you are sleeping than you can spend while you are away.

ARE_you_kidding_me's avatar

@Mariah, we are in agreement there. I would support such a system.

Cruiser's avatar

@Mariah That is essentially what we currently have only that income earners are afforded all manners of tax credits that enables last I heard 49% of the wage earners to pay zero in Federal income tax. The current game the rich play is hit them with higher taxes they game the tax loopholes just that much harder. It ends up being a wash for taxes collected or even a loss because the rich are adept at sheltering monies and writing off losses. Trump wants to do away with the loopholes and offer a flat 15% top tax rate. That !5% rate is essentially the exact same and more than what the rich currently pay if you take a close harder look at their effective tax rate which are often less. Trumps tax plan will hit the uber rich harder than the guys like me who will gladly invest those tax saving into our companies I truly could use 2 new employees and Trumps tax break will enable me to do this.

RedDeerGuy1's avatar

Having enough to meet ones needs is wealthy. Having enough for your wants too is rich.

janbb's avatar

@Cruiser I’m paying about 30% of my income in taxes with very few loopholes to lessen it. Where are you getting 15%?

ARE_you_kidding_me's avatar

If I calculate all of the “taxes” I’m paying be it income, sales, registration taxes, privilege taxes, property taxes, gas taxes, alcohol taxes and on and on 50% or more of what I make go to taxes and this is no exaggeration. It does not leave that much for me to live on in comparison to what my income is. I have few tax shelters to use, 401K, health savings account…that’s about it. I’m middle-middle class and we are being fucked….to death.
My beef is that when people say “tax the rich” it’s the middle class who end up taking it in the rear.

jca's avatar

In some areas of the country, 100k is barely middle class.

Where I live, for a single person or two people, 100k is moderate. For a family of four, it’s diddly squat. Houses around here are at least 300k, usually much more. “Upstate” you can buy a house for 75k, but not around here.

Cruiser's avatar

@janbb I have not recently taken the time to calculate all the taxes I pay but last time I did it was near 66% of my overall income. If you take it back down to liberal talking points of just the “Federal and State” ”adjusted” income taxes it was more down at 32% from the max 45% level I am being taxed in the upper income brackets.

How much more in taxes taken from me by Robin Hood will make you happy that would provide immediate relief to the solutions you see need fixing or make you feel better about us rich folk?? I ask you is it more money from “where ever” that will fix the poverty/low income crisis our country faces? Honestly what will it take and where dose it come from and why the hell do we continually spend more as a country than we take in? Instead of focusing on the people who create the jobs and pay gobs of taxes…can we for once get our liberal brethren to help hold the asshats in Congress accountable for the lousy fiscal policies they continue to pass instead of this torches and pitchfork attack on the wealthy who already foot the larger portion of our countries non existent budget ??

You may think you know Cruiser but you do not really know me as a real person… Not your fault either. Cruiser is Cruiser…I am me which I strain to keep as private as I can….I work hard, cherish and bend over backwards for those who do know me…I hold you as one of those I cherish here of all places…lets not let politics soil the fun and special moments we have shared all these years. Happy Hanukkah Jan

JLeslie's avatar

The top 400 earners in America pay 16.7% Fed tax on adjusted gross income. An article comes out every so often about it.

Personally, I think people should look at their tax rate based on gross, not any adjustments, because people talk about their wages and salaries as a gross number.

@janbb and @Cruiser Are you including all income tax, federal, state, and local in your percentage tax you pay? Or, just federal?

janbb's avatar

@Cruiser I agree – we’re friends Happy holidays!

Espiritus_Corvus's avatar

@Cruiser, you live in a place that nails you for not just federal and state taxes income taxes, but county income taxes as well. You also live either in or near the third largest city in the US, which is a very expensive proposition as to all forms of taxation. There was even talk when I was there in 1971 that the city of Chicago was going to enforce yet another income tax all it’s own upon the residents inside the city limits.

You are a private business owner. The plethora of taxes demanded upon you are enormous. I believe Chicago Land is unique for it’s long history of extremely deep political corruption and graft. the result of which was the massive disappearance of public funds and the solution to keep things running was further taxation.

The history is long, but pertinent. Endemic city and county corruption since the disastrous Chicago fire of 1871 eventually produced Mayor Bill Thomson and his machine, which included the Al Capone organization which made Tamany Hall look like a Catholic boy’s choir.

The history of the leaders of Chicago and Cook County abusing public trust is unfathomable to most people, even to New Yorkers and San Franciscans who know their history. Samuel Insull, the head of Chicago’s Commonwealth Edison, the electric monopoly serving Chicago, absconded to Europe with funds from Con Ed’s publicly held holding company bankrupting 600,000 investors. The knee-jerk reaction by city leaders was to enforce a new tax keep Con Ed—a private business—operating, instead of buying it outright. When Insull was finally extradited back to Sweet Home Chicago in 1934, he was duly tried and found innocent of all counts.

Many of the culprits are gone now and what is left is corruption in the persona of the Daley family and their Democrat cohorts, a kind of corruption “Lite” compared to ealier decades, but the taxes still remain.

Of course you’re pissed. I was too for the short time I lived there. I couldn’t believe how hard I was getting ponded. But I left.

I don’t think most Americans have to put up with this, especially on the other side of the Mississippi River and south of the Mason Dixon Line. So, your tax probems are probably only shared by the residents of the Washington, DC to Boston metropolitan corridor, not the rest of the country. I know this is personal, but you must ask yourself: Why did you build a business and a family in a place you knew you were being taxed to death?

Hell, no wonder you hate the Democratic Party. The most corrupt part of it has been running Chicago for more than 125 years. My sister lived 35 years in Aurora. If she had lived anywhere else in the US, she would have been considered a liberal democrat due to her sensibilities and beliefs. She voted the Republican ticket all the way down the line for the 35 years.

Cruiser's avatar

Ugghh @Espiritus_Corvus It is indeed hard to not think about all that you listed and when I do think about all the taxes and corruption here in Illinois, my blood pressure soars. I do dream of moving to friendlier and mores scenic areas, but I do a fair amount of business here in Illinois….probably 25% and at least 10% of that is will-call which I would lose a good portion of if I were to move the business. Plus where I am located is very ideal for shipping to anywhere in the US which makes it efficient to ship our products both cost and transit time wise.

It is definitely not fun living in the state that is world famous for it’s level of corruption and the distinction of having 4 of it’s last 7 Governors serve time in prison for their corruption while in office. I will never get over the time when Mayor Daley in the middle of the night and without notice bulldozed our beloved Meigs Field Airport on the lakefront of Chicago. Total dick move and speaking of dick’s please don’t get me started on “tiny dancer” Rham Emmanuel.

janbb's avatar

@Cruiser Well, you could always move to New Jersey – we’re such an ethical state! ~

ARE_you_kidding_me's avatar

@Cruiser look at east tn, they’re giving nice incentives to people like you. One big company was gifted the land they built their facility on. They also get special electrical rates if I recall.

Cruiser's avatar

I have a lease with the old owner I bought the company from and there is a clause in our loan documents that I must lease and run the company here in this building as long as he owns the building and the lease is for the life of the loan. I am stuck here.

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