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Portfolio > Economy & Markets

Here’s How Much It Takes to Be Wealthy vs. Feel Wealthy: Schwab

By Michael S. Fischer

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How much money does it take for an American to be wealthy? The answer depends on how you ask, according to Charles Schwab’s latest Modern Wealth Survey, released Tuesday.

For years, Americans have been telling Schwab’s commissioned pollsters that it takes around $2 million to be considered wealthy — $2.2 million in 2023, unchanged from 2022.

But 48% of survey respondents said they already felt wealthy, with an average net worth of $560,000.

Not only that, nonfinancial assets, such as family and health, were far more influential in their definition of wealth than large sums of money.

Sixty-two percent of survey participants said that being able to enjoy healthy relationships with their loved ones better describes wealth than having a lot of money, and 70% said wealth is more about not having to stress over money than having more of it.

What Does ‘Wealthy’ Mean?

Asked to define “wealthy” in their own words, 40% of respondents mentioned their well-being, compared with 32% who said money and 26% who said assets. Among baby boomers, 83% cited not having financial stress over accumulating more money, and 79% cited enjoyment of experiences.

“Americans today aren’t as worried about keeping up with the Joneses, and more importantly, they understand that they can be happier with fulfilling experiences and relationships, even if they have less money than them,” Jonathan Craig, head of investor services at Charles Schwab, said in a statement. “We’re seeing these trends at Schwab as well.”

Craig said clients’ goals and passions are reflected in how and in what they invest. Moreover, they want to be able to manage their money and investments without traditional barriers, such as high minimums and fees to access financial services.

Logica Research an online survey in March among a national sample of 1,000 Americans aged 21 to 75. An additional 200 Generation Z participants completed the study. Respondents had an average of $93,000 in household income and $361,000 in investable assets.

Social Media and Wealth

Having good relationships with family and friends is an important part of how Americans view wealth, according to Schwab’s survey.

But the survey findings also show that social media can generate new uncertainty and doubts for Americans when it comes to how wealthy they feel, and resurface the tendency to view themselves in the context of their social circles.

Forty-seven percent of respondents said being able to afford a lifestyle similar to that of their friends makes them feel wealthy, including 61% of both millennials and Gen Z participants.

Thirty-seven percent of those who use social media said they compare their lifestyles to what family and friends share on social media. Thirty-four percent make purchases based on what they see on social media from friends and influencers.

A third of respondents reported that they make financial decisions based on social media feeds of influencers and friends, including 46% of Gen Z and 45% of millennials. Likewise with investment decisions: 33% overall, and 50% of Gen Z and 44% of millennials.

Michael S. Fischer

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