Here's what 'wealthy' means in 2023 America, in five numbers

What does it take to be wealthy in 2023? A million dollars in the bank? Two million? How about a salary in the high six figures?

In different ways, the average American family feels both wealthier and poorer now than a few years ago.

Median household wealth hit $192,900 last year, up 37% since 2019, the largest jump in the history of the Federal Reserve’s Survey of Consumer Finances.

But inflation also hit a 40-year high in 2022, and in 2023, interest rates surged to the steepest mark in 22 years, developments that left everyone’s purse feeling a bit lighter.

Many Americans still strive for that first million. Yet, thanks to inflation, an item that cost $1 million in 2019 would cost $1.2 million today.

In a recent survey of 2,000 Americans by the personal finance site LendingTree, 59% said they do not believe they will ever become wealthy.

Here, then, are five numbers that illustrate what it means to be wealthy in America today.

$2.6 million

That lofty sum represents the net worth of the median American family in the upper 10% of income, a range that most of us would deem wealthy. The figure comes from the federal Survey of Consumer Finances, released Wednesday.

“Generally speaking, we might consider the top 10% of households by income as wealthy,” said Cristian deRitis, deputy chief economist at Moody’s Analytics.

Household wealth swelled at a record pace between 2019 and 2022. The government handed out an unprecedented series of stimulus checks. Lockdowns kept Americans at home and encouraged saving. Stocks and home values surged.

But inflation and rising interest rates have slowed the celebration.

“The market was down last year, and it still has not recovered from the peaks of late 2021, so there’s that,” said Robert Brokamp, senior retirement adviser at The Motley Fool and a certified financial planner.

$483,000

That is how much Americans believe they would need to earn in a year to be rich, according to an online survey of 2,521 adults conducted for Bankrate by YouGov on June 5-7 2023.

Sound daunting? The number is more than six times the $75,203 in average salary earned by full-time workers in 2021, as reported by the U.S. Census.

In the Bankrate survey, 72% of Americans said they feel financially insecure because of lingering inflation and rising interest rates.

Financial experts caution, though, that income doesn’t always equal wealth.

“You can be making half a million dollars, but how many assets do you have? How much debt do you have?” said Elizabeth Ayoola, personal finance writer at NerdWallet.

$2.2 million

That’s how much net worth an American needs to be considered wealthy in 2023, according to the Charles Schwab Modern Wealth Survey.

The survey, which polled more than 1,000 adults online in March, asked Americans how much money a person in their area would need to be wealthy.

It’s an annual survey. You might expect the figure to rise a little bit every year, along with inflation. But you would be wrong. Back in 2020, survey-takers opined that Americans needed $2.6 million to be wealthy.

“Surveys like this are interesting, because they are asking opinions, and they’re about emotions,” said Rob Williams, managing director of financial planning, retirement income and wealth at Schwab. “I think the story, to us, is more what it feels to be wealthy.”

$560,000

That sum is the average net worth of Americans who actually feel wealthy in 2023, as measured in the same Schwab survey.

Nearly half of Americans feel wealthy, Schwab reports, and their average household wealth falls well short of the $2.2 million to which they aspire.

Simply put, “you can feel wealthy and have less money,” Williams said.

When asked to describe wealth in their own terms, Americans talk about money and assets. But they also speak of intangibles: well-being, health and the freedom to spend time with loved ones.

“That’s encouraging,” Williams said.

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$1 million

The term “millionaire” may have lost some of its luster, but it remains a benchmark of American wealth.

“There’s no question that $1 million is a magic number,” said Matt Schulz, chief credit analyst at LendingTree.

“It doesn’t mean your life is easy or that you’re Jeff Bezos or Bill Gates, but it does mean that you have a level of wealth that most people can only dream of attaining.”

Vanguard, the investment management company, defines $1 million in investments as high net worth.

The average American family now reports a net worth of nearly $1.1 million, according to the new Fed survey. That sounds like a lot of money. But the super-rich skew the average.

The median American family, representing the midpoint among all families, holds $193,000 in net worth, the survey says.

Financial advisers often say that wealth isn’t a number so much as a feeling. For many Americans, it feels like security.

The Consumer Financial Protection Bureau offers a handy calculator of financial well-being. It asks, among other things, whether you could handle an unexpected expense, and whether a wedding or birthday gift might strain your finances, and whether you have money left over at month’s end.

Brokamp, of Motley Fool, puts it more succinctly:

“Can you pay your bills, can you accomplish your goals and can you withstand a financial shock?” he said. “If you can answer yes to those, you’re doing pretty well.”