Insight - World’s richest country has no concept of wealth

Tight situation: People walk through downtown Manhattan in New York. According to surveys, most Americans don’t have enough to survive in retirement, much less live comfortably or extravagantly. — AFP

HOW much money would it take to make you feel wealthy? What is wealth? What is money?

These are just some of the mind-bending questions raised by the results of a new Charles Schwab Corp survey taken way back in Ye Olden Times of February.

In a bit of a head-scratcher, the survey found that people think it takes US$2.2mil (RM9.66mil) in net worth to be “wealthy,” down from US$2.6mil (RM11.42mil) in 2020, just before the onset of the Covid-19 pandemic.

Survey respondents think it takes US$774,000 (RM3.39mil) to be “comfortable,” which is down from US$934,000 (RM4.1mil).

Given that consumer price inflation has soared from about 2% year-over-year before the pandemic to roughly 8% now, you might think people would need more cash to feel “wealthy,” “comfortable” or “able to buy milk”.

Then again, maybe the pandemic has made us lower our sights a bit. Perhaps all it takes to feel wealthy now is an RV (recreational vehicle), a pleasant Zoom background, and maybe a home office on the French Riviera.

In fact, the Schwab survey also found many respondents highly value, uh, values when considering employment.

Personal values

More than half said they’d take a lower-paying job for a company that “better represents personal values or interests”.

Of course, my personal values and interests include a home office on the French Riviera, so your mileage may vary here.

Still, 89% of respondents said they wanted fulfilling work, 85% said they wanted the respect of their colleagues and 84% said values guided their career.

Lest you think such numbers merely reflect the attitudes of so many woke Millennials, consider that Gen X and Baby Boomers together made up 56% of survey respondents.

So maybe money really is slightly less important these days. And from a global perspective, you could say US$2.2mil (RM9.66mil) is still exorbitant, considering the median global income is roughly US$12,000 (RM52,710).

Teen grocery clerks – or at least the ones not yet replaced by self-checkout machines – in America might be considered wealthy, or at least comfortable, by such standards.

On the other hand, again, have you seen prices lately? One rule of thumb for what a person might need to retire comfortably is 10 times their retirement-age income.

The median household income of Schwab survey respondents was US$68,000 (RM298,690), meaning the median retiree would need US$680,000 (RM2.98mil).


Make a little or a lot more than the median, and you can quickly see how even the US$774,000 (RM3.39mil) the Schwab survey considers “comfortable” can get uncomfortable in a hurry, particularly with inflation chewing through it.

The sad fact is that most Americans don’t have enough to survive in retirement, much less live comfortably or extravagantly.

A separate survey from the investment firm Schroders – also taken in February, back when the S&P 500 Index was about 500 points higher – finds Americans think they’ll need US$1.1mil (RM4.83mil) to retire comfortably.

But less than a quarter actually expect to hit that mark.

Terrifyingly, more than half of the Schroders survey respondents in or nearing retirement say they have less than US$250,000 (RM1.2mil) saved.

Again, everything is relative, and in most contexts US$250,000 (RM1.2mil) is a lot of money.

But a lot of us are in for a rude awakening about how truly expensive it is to be “comfortable” in America in 2022. — Bloomberg

Mark Gongloff is a Bloomberg Opinion editor and writer of the Opinion Today newsletter. The views expressed here are the writer’s own.

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U.S. , wealth , rich , Charles Schwab Corp , survey , insight


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