The Changing Face of Wealth

The Changing Face of Wealth

What does it mean to be rich these days?

If someone told you even 30 years ago that they had a million dollars, they would probably be considered significantly wealthy. Now, while a million dollars is still a large chunk of savings, it’s not quite as much as it used to be.

That’s the funny thing with the definition of being well-off. Like the value of a dollar, it’s ever-changing, and a bit complicated to define.

According to the dictionary, wealth means, “a great quantity or store of money, valuable possessions, property or other riches; an abundance or profusion of anything; plentiful amount; a wealth of imagery.”

So then, who and what is considered rich? It’s all about perspective.

In a 2013 survey by Spectrum Group, 45 percent of people ages 40 and under said a person needed a net worth of at least $1 million to be considered rich. However, only 22 percent of investors ages 60 and older agreed.

Where you live should also be taken into account when defining “wealthy.” In Atlanta, GA, for instance, you can purchase an average single-family home for about or less than half the price as one in Los Angeles, CA. Expenses are also minimal in the state as well, and salaries are much different.

So who is better off? Again, it’s a matter of perspective.

Expenses also play a part in wealth. While it’s common to have a mortgage, car payments among other bills, there are other factors that can come into play when determining one’s wealth.

“Investors’ second-biggest personal finance concern is the financial situation of their children/grandchildren (58% of those with children are concerned, behind being able to afford the healthcare and support needed in old age),” stated a survey by UBS.

To define wealthy, when you were/are alive also matters. Throughout the years, the amount a certain amount of money is worth changes.

For example, George Washington, the first president of the United States, made an annual salary of $25,000. That was considered extensively wealthy in 1789. Now, as of 2001, the average salary of the president is $400,000, along with a $50,000 expense account, a large pension, as well as other benefits. Even a mere 40 years ago, the average salary for a teacher was largely different than it is today. In the early 1970s, public school teachers averaged $9,729, whereas now it hovers around $55,400. The price of consumer goods has also become inflated over the years, which occurs whenever there is not enough supply of certain products and services to meet the demand of everyone who needs them. In 1949, a gallon of gas cost about 27 cents, compared to the average $3.60 today.

Wealth can also be based on how much you have saved, how much you make, how much you have invested, and more. In a survey done by PNC Advisors, people were asked to give a dollar amount of how much money it would take to make them feel secure. The common answer was around twice as much money as they currently had.

Depending on whom you ask, wealth can be defined in numerous different ways. Perception and perspective define wealth for people.

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