Exactly how much money do you need to be rich? Here’s a look at the numbers

People have always aspired to be “rich”. Some might argue that being truly rich far exceeds anything material. However, strictly speaking, financially, do you know what it takes to be considered rich in 2024? Combine your income, net worth and where you live. The definition of wealth varies, but here’s a look at what it generally takes to be seen as rich today, using some benchmarks.

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Income thresholds: what you need to earn

The top 20% of earners are usually classified as “upper class”. To be in the top 20% of US earners, you generally need to pull in about $130,545 a year. But this number is not the same everywhere. For example, if you live in New Jersey, you’ll need about $180,558 to reach that point. Meanwhile, in Mississippi, it’s lower at about $101,447.

If you want to be in the top 5%, the bar is much higher. In Connecticut, for example, you would need to earn over $600,000 annually. And if you want to be in the top 1%, you’re looking at an income of about $819,324 a year — or about $68,277 a month.

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Net worth: The must-haves

In terms of net worth, having $1 million in liquid assets often puts you in the “high net worth” category. But if you want to be considered very with a high net worth, you might need $5 million to $10 million. For those aiming even higher, ultra-high net worth status could mean having $30 million or more.

Interestingly, the perception of what makes someone rich has changed. According to Schwab’s Modern Wealth Survey, Americans now believe you need a net worth of about $2.2 million to be considered wealthy. That number is down slightly from 2020, when people thought $2.6 million was the magic number.

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Location Matters: Cost of Living

Where you live plays a big role in what it takes to be rich. In expensive places like New York or California, the income required to be in the top 20% is much higher than in states with a lower cost of living. Wealth isn’t just about money, though—it’s also about what that money can buy, and that changes depending on your location.

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Wealth distribution: who has what

Wealth in the US is not evenly distributed. The top 10 percent of households control a large portion of the country’s total wealth, averaging about $6.7 million per household. On the other hand, the bottom 50 percent have an average wealth of just $50,000, according to the Federal Reserve Bank of St. Louis. This gap shows how varied wealth can be depending on where you fall on the economic spectrum.

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Mindset and Lifestyle: It’s not just about the money

Being rich isn’t just about the numbers, it’s about the way you think and live. Wealthy people often focus on long-term goals, invest wisely, and build strong networks. They also tend to value experiences and relationships instead of collecting more things. Many prioritize work-life balance and maintaining health, which they see as part of being truly wealthy.

conclusion

In 2024, being considered rich isn’t just about reaching a certain income or net worth, it’s about having the right mindset and living in the right place. Whether you earn a high salary, accumulate assets, or focus on personal growth, today’s definition of wealth is broader than ever. But no matter how you slice it, achieving that “rich” status involves a mixture of financial success and a lifestyle that supports it.

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