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ARE YOU RICH?

Billionaires know they are. Low-wage workers are very well aware that they
aren’t. But vast swaths of America’s “regular rich” don’t feel that way, and
it’s keeping everybody down.

By Claire Ballentine and Charlie Wells

August 14, 2023 at 5:00 AM GMT+2

Share this article

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 * 
 * 
 * 
 * 



You know them. They’re lawyers in New York, doctors in Phoenix, dentists in
Memphis. They own construction companies in your hometown, burger franchises off
the highway, homes in the resort villages your parents want to retire in.
They’re young, old, Democrats and Republicans. They have two things in common:
They’re rich. But they don’t feel that way.

THE RICH DON’T ALWAYS FEEL RICH

Question: How rich or poor do you feel today?

Source: Bloomberg/Corus


In fact, many even go so far as to say they’re poor. In a nationwide survey of
over 1,000 objectively wealthy Americans — defined in this case as making at
least $175,000 a year, roughly the amount required to crack the top 10% of US
tax filers — a full quarter told us they were either “very poor,” “poor,” or
“getting by but things are tight.” Half described themselves as just
“comfortable.”



The people we polled have good jobs, own their homes and have savings for
retirement. By some combination of hard work and good fortune, they’ve achieved
the old-fashioned American Dream. Still, for many it’s not enough.

SOME MILLIONAIRES STILL SAY THEY ARE POOR

Question: Approximately, what is your net worth (value of all assets minus your
debts)?

Source: Bloomberg/Corus

At a time when pretty much everything is more expensive, including cars,
tuition, travel and groceries, over half of respondents in our survey said they
worry about money. Some 25% don’t think they’ll be better off financially than
their parents. And many have considered moving to a different part of the
country, joining the pandemic exodus away from high-cost cities to areas of the
US with lower taxes and a cheaper cost of living.

MAJORITY OF HIGH EARNERS STRESS OVER FINANCES

Question: Do you worry about money?

Source: Bloomberg/Corus

The last few years have seen a once-in-a-generation reckoning in how Americans
think about work and where they live, and that of course ties back to how much
money they have and how long it will last. To help you understand how your
wealth stacks up where you live and how it might look if you decamped to South
Carolina, Texas, West Virginia, Florida or other places across the US, we
developed a comparison tool.

It uses data from the Census Bureau, covering roughly 85% of the population, to
show how much richer or poorer you’d be in a different part of the US. The top
salary it measures is $200,000. For more information, see the methodology
section.







WHY IT MATTERS

The dissatisfaction of the mass affluent might seem like a rich person’s
problem, but it hints at a potential breakdown at the heart of American
capitalism. Much has been written about the end of upward mobility in the US and
how hard it is these days to build wealth. But if those who have actually made
it don’t feel like they have, where does that leave the rest of us?

Want to go even deeper? Our WealthScore tool shows a full breakdown of how your
finances stack up to help you get ahead.

Social media makes it easier than ever before to compare your lifestyle with
those of your neighbors, celebrities, professional athletes or friends from
college on the other side of the US. It’s a daily bombardment — private jets,
lavish trips, fancy meals, home renovations and other flashy displays of
conspicuous consumption. With a few clicks, it’s easy to be left feeling like
you don’t have enough, especially at the time when the ultra-wealthy have
accumulated more and more money and there’s a growing sense that more and more
people are getting left behind.

Bloomberg Quicktake

To understand the large and growing class of “regular rich” people, we polled
hundreds of them and interviewed dozens in extensive conversations covering
everything from their incomes and net worth to their thoughts on relocating to
cheaper parts of the US. The goal was to understand why so many with so much
feel poor. And what it all means.

The most revealing thing that happens when you ask someone the question “Are you
rich?” is not necessarily the “yes” or the “no” but the more detailed answers
that immediately follow.

> “I still worry about money,” said Debra Corbin, a 67-year-old retiree in
> Naples, Florida, with a home worth more than $1.3 million. “I think rich is
> subjective. When I’m in southern Illinois where we're from I feel rich.  When
> I’m in Naples, I feel blessed. Down here it’s hard to feel rich because there
> are billionaires down here.”

> “I grew up quite poor, and I know money can be taken away,” said James
> Bramble, a 53-year-old attorney in Salt Lake City who makes about $350,000 a
> year. “To really feel rich that I think you would no longer have to depend on
> money — like if you didn’t work, you’d still be okay for the rest of your
> life, and I’m not there.”

> “To feel rich, I would have to own my house free and clear without mortgage,
> pay for my kid through college and have more liquid cash in the bank,” said
> Erika Wilson, 45, who has a household income in the “low six figures” and
> lives in Durham, North Carolina. “I worry about future expenses and increasing
> inflation.”

Here’s a fuller look at what people told us when we asked them a simple, but
fundamental question: Are you rich?


Tiouba ParrisAdvertising Account DirectorHouston, Texas Photographer: Callaghan
O'Hare/Bloomberg

Tiouba Parris spent most of his life in New York City, but then joined the flock
of people who moved to Texas during the pandemic. The 33-year-old had built a
successful advertising career in Manhattan but felt like his annual salary of
$160,000 wasn’t going very far.

“I was making good money, but it didn’t feel that way in New York,” he said. “I
wanted to move somewhere I could make the most of my finances.”

In April 2022, he decamped to Houston where he can get a 1,000-square foot
apartment in a luxury building for just $2,700 a month— much more space than his
New York place and $300 cheaper.

Plus, he loves the lack of income taxes in Texas. He got to keep his New York
salary when he moved, so he’s suddenly getting a bigger chunk of take-home pay.
Everything is also cheaper in Texas, he said, especially restaurant meals and
alcohol. He’s aiming to buy a house in 2025, after the real estate market
hopefully cools.

CHANGING LOCATIONS WOULD MAKE SOME FEEL RICHER

Question: Have you recently considered moving to a different part of the country
to change your financial situation?

Question: Do you think moving to a different part of the country would make you
feel richer or poorer?

Source: Bloomberg/Corus

Still, he worries about money and definitely doesn’t feel rich.

“Ten years ago if I had told myself I was making the money I am now, I’d be
flabbergasted. I would’ve said I was living it up,” he said. “Now, while I’m
financially secure, it doesn't feel like I’m making the dollar amount I’m
making.”

Parris started a sneaker cleaning company as a side hustle, which nets him about
$10,000 in profits a year. He has about $10,000 in emergency savings, a 401(k)
and sneaker collection worth about $30,000, but he knows that wouldn’t get him
very far if he lost his job, especially with an $850 monthly payment for his
private student loans and the lifestyle creep that inevitably accompanies a
six-figure salary.

“Honestly the more money you make, the more your lifestyle kind of changes a
lot,” he said. “Your vacations and the restaurants you go to are more
expensive.”


Jennifer NguyenStock Plan AdministratorHuntington Beach, California
Photographer: Alisha Jucevic/Bloomberg

Before having kids, Jennifer Nguyen never worried about money. Now the
36-year-old mom to a toddler and a newborn, who lives in Huntington Beach,
California, is constantly stressed about finances — daycare bills, future
education costs, buying clothes and food for her growing family.

This is despite making good money. She works as a stock plan analyst and her
husband is a computer programmer, making about $300,000 a year combined, far
more than the average American. Their home, bought in 2012 for about $400,000,
is now worth more than $1 million.

Yet rising prices have her concerned about the future, especially in her area.

“It just seems like everything is just getting more expensive,” she said. “We’re
comfortable now, but what about when my kids go to college? And before that, do
I have enough to put them in daycare? Do I want to have a nanny?”

Getting laid off last year — she’s since found another job — made her realize
how precarious her financial situation truly is.

OWNING A HOME BOOSTS FEELINGS OF WEALTH

Question: Do you rent or own your primary home?

Question: Approximately how much is your home worth?

Source: Bloomberg/Corus

“Now that we have kids, I want to give them the biggest financial cushion I
possibly can,” she said. “If that means a lower-cost-of living area, that might
require moving out of state.”

She’s talked to her husband about relocating to Texas, attracted in part by the
lack of income tax, but they have lots of family in California, which would make
it harder to leave.

Subscribe and listen on iHeart, Apple Podcasts, Spotify


JANE EDWARDS

Banking Consultant
Brooklyn, New York

New York City resident Jane Edwards, 55, has one word to describe the state of
her finances: “terrible.” She makes about $180,000 a year as a banking
consultant on Wall Street, but that doesn’t go very far, especially given
inflation in recent years, she said. She currently doesn’t have any retirement
savings, after losing a lot of it in the 2008 financial crisis and then cashing
in the rest of her 401(k) in subsequent years to pay her bills.

“I know it sounds like a lot of money, but it’s just not in New York,” she said
about her salary.

Edwards is currently about $10,000 behind on rent and can’t afford health care
as a freelancer. She used to pay as much as $4,000 a month in rent, but she
recently found an apartment in Bushwick for $1,200, which she’s hoping will help
her financial situation. She’s considered moving out of New York to Florida or
the West Coast, but after her husband died a couple years ago, she's been
relying on friends in the area for support and is reluctant to give that up.

“I’m just broke all the time,” she said. “I was never rich before but I was able
to pay my bills. Since the pandemic, everything has gotten more and more
expensive.”


Mary PhippsRetired PharmacistSt. Cloud, Minnesota Photographer: Nicole
Neri/Bloomberg

After a long career as a pharmacist, Mary Phipps finally feels rich. The
66-year-old who lives in St. Cloud, Minnesota, never made a crazy amount of
money — about $200,000 a year before she retired about a year ago — but it was
more than enough to raise five kids with her husband, a freelance artist who is
also now retired. Their home, bought for about $179,000 in 1999, is now worth
more than $370,000 and completely paid off.

THE RICH HAVE LARGER RETIREMENT ACCOUNTS

Question: How much do you have saved for retirement?

Source: Bloomberg/Corus

With a healthy retirement account and social security checks arriving for both
her and her husband each month, their income now is about $14,000 a month before
taxes, more than enough to live on. Right now, she’s financially secure.

“We like to travel a couple times a year and overall we’re able to do what we
want,” she said. “We don't spend as much as we did now that our kids are grown
and college is done.”

Raised by parents who lived through the Great Depression, she can’t help but
worry a bit about money, and Minnesota’s relatively high state tax doesn’t help.

“I know we’re not going to run out of money, but maybe that’s just the way I was
brought up.” she said.


Tom ThompsonConsumer Behavior AnalystDallas, Texas Photographer: Shelby
Tauber/Bloomberg

Despite owning a home worth almost $400,000 in Dallas and a condo in Hawaii, Tom
Thompson and his wife don’t feel rich. In fact, having more money has just
resulted in more bills. The 54-year-old is feeling the pressure of inflation,
especially as he prepares to pay for his 18-year-old son’s college tuition.

Despite an annual household income of about $450,000, Thompson worries about his
job stability at an ad agency where losing a big client could mean a layoff.

“We’re not living paycheck to paycheck, but I feel like we have looming
expenses,” he said. “My personal definition of rich is the ability to buy or
participate without concern, and I do not have that.”

His bills keep adding up: $2,800 a month for his mortgage on the Dallas home,
$1,400 a month for the Hawaii condo, three car payments, and soon his son’s
$25,000 yearly tuition. His salary isn’t keeping up.

“I know we do very well, but I didn’t get a raise and neither did my wife since
before the pandemic,” he said. “That’s starting to impact that feeling of
wealth.”

He and his wife, who works as a consultant on employee benefit plans, have
considered moving to a cheaper area like New Hampshire or even overseas to
Amsterdam. But he’s hesitant to give up the 2.2% mortgage rate on his home, so
for now, he’s staying in Texas.

--------------------------------------------------------------------------------

Data analysis and graphics by Phil Kuntz, Jeremy Diamond and Demetrios Pogkas

Edited by Craig Giammona and Kristine Owram

With assistance by Ben Steverman and Noah Buhayar

Lead photos: Callaghan O'Hare/Bloomberg; Nicole Neri/Bloomberg; Alisha
Jucevic/Bloomberg; Shelby Tauber/Bloomberg

Methodology


The underlying data for the "Where Would You Feel Richer?" graphic comes from
the US Census Bureau's American Community Survey (for median household incomes
and housing costs) and the Bureau of Economic Analysis (for regional cost of
living estimates). All figures are for 2021, the most recent available.


The graphic analyzes figures for 384 metropolitan statistical areas in the US,
where more than 85% of the country's 124 million households reside. The rest
live either in more rural areas or in Puerto Rico, which was excluded because
comparable cost-of-living data wasn't available for the commonwealth.


The Census survey shows the number and percentage of households within each of
10 income brackets in each metro area.


 * Less than $10,000
 * $10,000 to $14,999
 * $15,000 to $24,999
 * $25,000 to $34,999
 * $35,000 to $49,999
 * $50,000 to $74,999
 * $75,000 to $99,999
 * $100,000 to $149,999
 * $150,000 to $199,999
 * $200,000 or more


The number of households with earnings in these ranges are not equal, unlike
income analyses that split up the country into equal population baskets. The
graphic uses the totals associated with these baskets to compare your
household’s income with other households in your area and in all metro areas.

The BEA's cost-of-living figures, known as price parities, are used to compare
the buying power of your income in your area to the same income in a comparison
area, showing how much poorer or richer you'd feel (unless the two areas’ price
parities are the same).


The parity figures are from an index based on 100 (for the US average) and range
from 83.8 in Alabama's Anniston-Oxford area to 119.8 in California's San
Francisco-Oakland-Berkeley area. Those two areas can be used to explain the
calculations behind those richer-or-poorer comparisons:


 * A household making $100,000 a year that moves from the lower-cost Alabama
   area to the pricier California region would feel $30,050 poorer because:
    * $100,000 x (83.8 / 119.8) = $69,950 in buying power in the San Francisco
      area, where the cost-of-living is 43% higher or (83.6 - 119.8) / 83.6

 * Conversely, a $100,000-a-year family moving in the other direction would feel
   $42,959 richer because:
    * $100,000 x (119.8 / 83.8) = $142,959 in buying power in the Anniston area,
      where the cost of living is 30.1% lower or (119.8 - 83.6) / 119.8


The two relative buying-power figures are plotted on the bottom bar chart, with
their positions based on where the two areas' price-parities are compared to all
other areas.




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