What's it take to feel rich around here?

The standard view of what makes an American 'wealthy' has evolved in the last half-decade or so.

By MSN Money Partner Nov 5, 2012 5:54PM
Image: Senior couple on a yacht -- Digital Vision/Getty ImagesBy Jason Notte

Regardless of who they're supporting in this year's presidential election, even wealthy Americans aren't feeling nearly as rich as they were in the jumbo mortgaging, BMW-leasing, cell-phone bedazzling, debt-fueled good ol' days of the mid-2000s.

Ipsos Mendelsohn earlier this year asked affluent Americans earning $100,000 or more annually to define who they felt was in the "1%" targeted by Occupy Wall Street. On average, they cited people making at least $1.4 million a year. The bourgeois protests too much.

According to Ipsos, those $100,000 households are in the top 20% to 25% of earners, but think they're in the 38th percentile. Meanwhile, super-affluent households making $250,000 a year or more are in the top 2% to 3% of earners, but think they're in the 16th percentile. The federal government says it takes only $325,000 a year to make that elusive 1%, with only individuals and couples with income of $379,000 or more qualifying for the Internal Revenue Service's top 35% tax bracket.

"That's a big difference from 2006 or 2007, when everyone kind of overestimated how wealthy they were, or at least they felt like they were going to get rich, so started spending according to their perceptions," Steve Kraus, chief insights officer in the Audience Measurement Group at IpsosCT, told Ad Age. "Today, I think it's more the opposite pattern."

The standard view of what makes an American "rich" has also evolved in the last half decade or so. Forget the sprawling celebrity mansions on MTV or the free-spending "reality" of a Paris Hilton show: According to a Gallup poll released in late 2011, it would take a median of just $150,000 a year in income for them to consider themselves rich. Those making less than $50,000 a year, the Census Bureau's median annual household income, would make do with $100,000 a year.

College graduates, city dwellers, inner suburbanites and those already making $100,000 a year have a somewhat differing view of richness, setting the bar between $200,000 and $250,000 a year. That's more in line with the folks Congress was debating an extended tax cut for for last year, but still well shy of what the actual 1% needs to feel comfortable. Back in June, Fidelity surveyed 1,000 millionaires with an average of $3 million in worth and asked them what it would take to make them wealthy. The answer? About $5 million in investable assets, which is down roughly a third from the $7.5 million they felt they needed a few years back.

Aspirations may have been tempered a bit, but there's little indication that politics have had anything to do with it. According to the Ipsos poll, 49% don't expect their saving or investment plans to change in 2013 no matter who occupies the White House. That's compared to 14% actually who plan to spend or invest more if Mr. Obama wins and 37% who'll open the wallets a bit if Mitt Romney wins.

Then again, maybe that lower bar isn't so bad. A whopping 55% of folks who make $250,000 or more a year expect taxes to go up if President Obama is reelected, but 24% think they'll rise even if Romney wins. Limbo under that, and you'll fit cozily among the 99% without sleeping a single night in a public park.

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23Comments
Nov 6, 2012 7:26AM
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If Obama wins, I will reduce my income.   Everything I have is paid for so why not join the 47

%ers?   Many business feel this way.  Why invest into your business knowing Uncle Sam is going to take, take and take.  Can't beat um, join um. 

Nov 6, 2012 11:24AM
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 with only individuals and couples with income of $379,000 or more qualifying for the Internal Revenue Service's top 35% tax bracket.
======================================================

 

..There writers never take the time to give the correct tax terms, the "income" in this statement is taxable income, not gross income, and that is a big difference.

Nov 6, 2012 12:59PM
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What people do not understand is that there is always a way around higher taxes for the rich. If the taxes on my income above 250k is raised I will just put my children on my payroll and pay them directly instead of paying myself. Then they will have the funds to pay for their own education. People  get upset that the rich pay a lower tax rate through loop holes in the tax system. Do not get mad at the rich get mad at the politicians that create the tax code. There are a lot of way to evade taxes, you just have to educate yourself to the tax codes and invest accordingly. A great example is how someone self employed pays themselves. I can take a pay check and pay 35 % federal tax, 7.65 SS tax that is also matched by the company, state tax, and local taxes or I can take a dividend from my stock and pay 15% capitol gains tax. What would you do. The rich are not breaking the law, instead they are taking advantage of the laws. Just as an FYI, I do not mind paying higher taxes, but I am going to take the path that is best for me and my family. The goal of working is to earn and keep as much for yourself as possible. Welcome to America. 
Nov 6, 2012 9:13AM
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I feel the same as dairy 1, If Obama wins I am going from the 1% to the 47%. I quit. I am not going to work 60-80 hours a week to pay more taxes. I will shut my company down at the end of the year and retire overseas. My employees understand, because with all the regulations it is just too hard to make a profit these days. Too many lawyers and too many people with frivilous lawsuits. You can't spend time making a lving and a profit, you have too spend too much time preventing people from winning the lawsuit lottery off of the back of the working folk.   
Nov 6, 2012 11:42AM
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what recovery? obama is a sham, for the sake of god vote him out! im tired of being broke
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Wealth is in good health, you can have a couple of millions but die of cancer just like anyone else!
Nov 6, 2012 1:11AM
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It's hard to feel rich when you have two presidential candidates making 10 times more than what I ever did yet paying less taxes than I did in ten years.  Maybe the word "privileged" comes to mind.  Equality and justice have gone somewhere else.  And FYI, The founder of "Occupy Wall Street" movement is also a one percenter who shipped those donations to Canada.
Nov 7, 2012 1:24PM
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What can you say at this point (post-Election), except: HAAAAAAAAAAAA, HaHaHaHaHaHa!!!  All you Romney wanna be fascist racist clones!  You lost!  Eat that!!
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I will not stay here after I retire . God was ,is and will be good to  me .
Nov 6, 2012 10:12AM
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who ever wins i know i'll be living on credit. thanks gen x.
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