Are YOU “Rich”? And If So — Why?

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are you super rich?The recent debate about “who is the super rich” has been interesting to me, and it's a subject, I think, that we should discuss here. The initial “Our family of 5 can barely survive even though we make more than $400K a year” post has been taken down, but you can read some of the commentary here and here. Elie Mystal also had an excellent post at Above the Law about how $250K in NYC does not make a family of 2 “rich.” All of this comes against the question of whether a higher paycheck will make you more satisfied/fulfilled by your job. Let's explore these questions: what is “rich” to you? How are you, as an “overachieving chick,” motivated by money — particularly if it means balancing a stressful job? (Pictured: Halogen wallet, available at Nordstrom.) And, a caveat to start:  I know there are no right answers here.

I've gone over and over how best to approach this — too.many.thoughts! — and I guess I'll start by saying that personally, I've never really felt motivated by money in my career choice (which is probably already indicative of my upper-middle class background). My first job paid $24K, and when I got the offer letter I ran around the house screaming, “Man, what am I going to DO with all that money?” while my parents winced. It turned out that the answer was “barely survive in NYC” — it required a budget so strict that I sometimes had to bring a raw potato to work to nuke with a slice of American cheese. I knew going to law school would bring me “more money,” but I had no real expectation of how much — I went because I was actually interested in legal things. As it turned out, getting a job at a Top 100 firm (and being a single girl) allowed me to bank my entire second paycheck and still spend what I wanted without really thinking about it. That was nice. I'm somewhere in the middle of those two incomes right now, but my situation has also changed — I'm married, the hubs has a bit of student loan debt, and we have a mortgage to worry about. Debt isn't fun, but I know we're lucky that our net worth is in the black.

So readers, I guess what I'm curious about is — what is “comfortable” to you, money-wise? When will you feel like you've “arrived”? Is it the ability to drive a luxury car and take an international vacation once a year? A closet full of Manolos? Or is it simpler — freedom from worrying about money? A positive net worth? Will you feel like you've hit the jackpot if you can pay for your kids' private college education? And — how much is your current job and current career motivated by those desires? How much do you measure your personal “success” if you can meet those desires? And to what extent will future choices re: kids and retirement be influenced by those thoughts?

Another nagging question that I'd love people's thoughts on — is it different for men? I've known people who've said they wanted to be billionaires, as well as people who treated the number on their bank statement like a game (how much higher could it go)? — but to be honest, most of those people were guys. It always seemed like the women I've known who aspired to be wealthy and have truly comfortable lives have preferred to marry well rather than pursue their own careers.

253 Comments

    1. I was going to have the same sentiment. To some it sounds contrite – but I don’t measure my life based upon my income, I measure it on the people I surround myself with and the joy those relationships bring.

      I’m neither wealthy or poor, I’m content.

        1. Very true. Alas, is it a weekend yet. Hahaha – my brain is dysfunctional and needs a rest. Thank you.

  1. I 25% like my job and 75% am here for the money. Well, maybe today isn’t the best indicator of my overall satisfaction, but you get the idea.

  2. Not rich but not poor and doing better than my mother who raised me did, so I consider it a success. A load of “good debt” but no bad so that balances and after a career change for hubby, a much happier hubby as well. We may never live Silver Spoons, but I can pay the bills and not cry at night about expenses.

  3. Rich is a pretty general term, but I knew I was comfortable when I was able to hire a housekeeper to come every other week. I’m single, my student loan debt is minute, my mortgage is there, and it fits in with my salary. Obviously salary is a major consideration when I look for a job/make career decisions, but it’s not the only one.

  4. I’ve always been motivated by money, and I’m ok with that. I can’t imagine I’d ever take a job I “love” if I was going to have to worry about money as a result. There are too many jobs out there that pay well that also bring me enjoyment. I also have an upper-middle class background. I’ve never struggled with money, and never had to worry about money. I can imagine that worrying about money would be extremely stressful and somthing I’d like to avoid at all costs. As long as I’m not stressing about how to pay my morgage, bills, save for retirement, invest and have some money for play time, I feel rich.

  5. I just graduated law school and am lucky to have a Biglaw job lined up. I can say almost without question that I took the job for the money. I hate that that’s true, and I worry a lot about how I’ll function in the job knowing that it’s not even close to what I would do if both me and my husband didn’t have so much debt. As for what constitutes wealth, right now, a couple months out from my first pay check, the salary seems HUGE and I feel like I’m going to be rich. But I’ll let you know how I feel after sending very LARGE checks to Sallie Mae each month :)

    1. L – I highly recommend that you pay down your law school loans as quickly as you can. I did not do this (I paid every month, and sometimes a bit extra when I got my bonuses, but I definitely enjoyed my big paycheck more than I should have!). I regret not having paid them down more quickly, especially as I am now 4 years out of school and in an in-house job I LOVE but it is approx 2/3rds the salary – which is still a lot of money, but many would I be happy not to have loan debt right now :)

      Just a suggestion – take, leave, whatever! And congrats on the job.

      1. That should have been “man would I be happy” not many. Man I hate my own typos :)

  6. I make more as a single woman than most American families – a salary in the 60s for a public sector job that I love. But with my student loan debt and expenses related to chronic health problems, I barely get by. I can do fine with my monthly fixed expenses, but every non-regular expense (bar dues, medical bills, annual insurance premiums, CLE, replacement of worn-out clothing, etc) requires the use of a credit card or dipping into my savings. As soon as I pay down debt or build up some savings, something comes up to deplete it.

    My parents were working class and worked hard to prepare me to go to college and law school – what they thought was the American dream. But because they were unable to finance it, I started my adult life 200K in debt. I don’t see how I’m ever going to get ahead. If my income goes up, my income-contingent loan payments go up. I’ll be in my late 30s by the time I pay off my student loans, assuming I get loan forgiveness; I feel like I’ve been forced to delay adulthood until then. I’m terrified of what might happen if I lost my job with so little savings in the bank, and of course if I lost my job my health expenses would spiral out of control as I’d lose my insurance too.

    I’m no socialist, but it seems absurd to me that so many people who work hard and are extremely smart, who want to work in public service, and whose only mistake was being born to working or middle-class parents are unable to get ahead due to educational and healthcare expenses.

    Sorry this didn’t really answer your questions, Kat, I just needed to vent. I’ll close by saying that I’ll feel like I’ve “arrived” when I can make a $20 purchase the day before payday without having to first check to make sure I have $20 in the bank.

    1. So true, everything you said–middle class, $60K a year, public sector and especially your last sentence, I check my acct almost everytime I go to make a purchase, just in case! Whoever said money doesn’t equal happiness must have had a lot. I mean, aside from a career I resent, I love every aspect of my life–just wish I didn’t struggle to get by… or have to short the electric co. $30 this month because I spent too much money on gas for my car this month!

    2. I’m a deferred associate working at a nonprofit for a year. My first week, a grumpy coworker (long-term employee of nonprofit) advised me to stick with Biglaw and not to go to a nonprofit (something I could see myself doing). She hates her life and her job, and, in retrospect, she wishes she had gone for the money. It was pretty depressing to hear….

      1. There are a lot of dysfunctional, crappy nonprofits out there (as there are law firms). Wherever you end up, find out as much as you can about the work culture and the workings of the organization before you accept the offer.

  7. A mortgage, my enormous amount of student loans, DH’s student loans, some credit card debt from law school, and trying to help DH start his own business… I don’t see “rich” happening for a long time, despite having a decent job at a law firm. Do I love my job? No. But it doesn’t make me cry on Monday morning. Would I quit my job and go work somewhere that would make me happier? Only if it became clear, within the next two years, that I am not making a dent in the “get rich” goal anytime soon. Because, right now, I’m NOT getting paid what BigLaw associates are getting paid, and I could take a government job for about the same amount. Hopefully, those raises are just a little while down the road.
    Rich, to me, means not worrying about paying bills, which would include paying off my student loans in the next ten years, since my generation of grad students is blessed with 8% interest rates.
    But honestly, if I didn’t have my credit cards to pay off, I would be feeling alright for a 25 year old.

  8. I suppose most people would consider me “rich” (2 person family, bring in combined ~$350k, no debt, nice size savings, ages 26 and 28) but I am NOT a spender and I am constantly looking for deals on things. In order to feel rich, I think I’d need savings upwards of $5 million and a combined income over $500k because it wouldn’t be until I got to that point (and perhaps even beyond) that I’d let myself spend freely – which to me, rightly or wrongly, is what I associate with being “rich.” I’m still at the point where I look at a nice sweater for $100 and don’t even CONSIDER buying it. Of course, I’m not saying I’m not thankful for what I have – I absolutely am – but “rich” is still just an aspiration.

    1. This was the sentiment I was aiming for. To me, “rich” are people who can truly afford to buy big houses, take trips when they want, buy whatever they want (within reason), and not have to consider how it affects the bottom line, retirement savings, or sending kids to college. Maybe that is an unrealistic expectation of “rich” — I have no illusions that there are few people in this category, but that’s what “rich” means to me.

      My husband and I, with two BigLaw jobs, are “comfortable.” That means we don’t have to worry about money and we can afford to pay down my student loans, save for retirement and kids’ education, and buy a house. But we don’t own a big house, take lavish vacations, or spend much at all on clothes. We bargain hunt and gladly and regularly shop at Target, WalMart, Filene’s Basement, etc. And another key distinction between “comfortable” and “rich” to me is stability — what is the likelihood we’ll always be this carefree? Very low. Our incomes are not sustainable for the long-term, so we have to save extra now to make up for the future. Being in that position, I couldn’t call myself “rich.”

      All that said, I will NEVER complain about being “merely” “comfortable.” I’m very, very lucky. Way luckier than my parents were. I have a wonderful life and feel blessed every day to be in the financial situation I’m in.

      1. Not sure we have the same definition of “comfortable” and “rich”. I would consider myself “comfortable”. I make $100K and pay all my bills, easily. I have considerable student loan debt. I am 29.

        From what you are describing, you have NO debt (HUGE!), are VERY YOUNG and make a ton of money. “Rich” doesn’t mean how you decide to spend it, but rather that, if you wanted something, you could pretty much have it. And on $350k per year with no debt, I bet you could buy a nice -even what many would consider lavish- house, probably go a few nice -lavish- vacations every year, and have the power to buy things that many could not even hope to obtain.

        I mean, if you aren’t buying a house, paying down debt, buying clothes or going on vacation, what exactly are you doing with $350k per year? Are you putting it all in retirement and a house down payment?!

        1. Well, I’m not sure my definition is everyone’s, or the right one, but I do think there is a distinction between “comfortable” and “rich” that not everyone sees when they have these conversations, and that I think is a useful distinction.

          And, to be clear, you’ve assumed some things incorrectly about me. I do have debt. I make sizable payments on my sizable student loans every month (as does my husband). We also have a mortgage and probably have a positive net worth of ~$100k. And we’re not “YOUNG” — not sure why you think that. And what I didn’t make clear I guess is that my husband and I own a condo, not a house.

          Sure, part of this is our being conservative spenders — we could have bought a townhouse or perhaps a small SFH in a less desirable school district — and perhaps maybe more of it is conservatism than I give credit for. I’m not sure.

          But I guess my key point is the stability one. We do save a LOT … because we cannot both continue working BigLaw jobs and still have a healthy marriage and family life (not to insult those couples who do this — but it wouldn’t work for us). So we need to save for our children’s college education NOW (before they are born). And we can’t count on our money working for itself in the near future as far as retirement savings go, so we’re losing prime investment years working and trying to save in this economy. I don’t see how I can be “rich” when the proper (properly conservative, and therefore proper) choice for us (given debt load and future income) is to live in a two-bedroom condo.

          Again, I say none of this to belittle the amazing life and financial security that I have. I am fortunate and blessed and … again … I am not complaining and will NEVER complain about my financial circumstances. But “rich” does not seem to be the right word for my life.

          1. I think “M” was responding to me. :-)

            As for where the money is going, yes, primarily into savings for when we decide to buy a house or apartment and for retirement, and as a cushion in case one or both incomes fall off (and potentially for supporting parents in old age). We take vacations to nice places but keep our accommodations very “budget.”

            I completely agree that I’m in a good position and I do think I appreciate my situation. At the same time, the fact that I *could* afford a luxury item if I want it doesn’t mean it would be inconsequential if I were to actually buy it, the way it would be if I had assets in excess of what it would take to support a comfortable lifestyle through retirement (which, more than my $5m threshold above, is probably how I’d define “rich”).

      2. If you can do all those things, you are not comfortable; you are rich. Nothing wrong with that.

      3. I agree with E Anon and Anon for this One on this issue. Let me first say, I am perfectly aware that I am in a much better financial situation than many (most) people. I don’t have to worry about buying food, for instance, and for that I am grateful. However, the current public dialougue on this issue conflates “income” with “wealth”, and I find that very frustrating.

        We have 275ish in income, and three kids. Of the salary total, take $32K off the top for 401Ks. Then, in an average year, all taxes fed/state/local combined take 40+% of our income. Because of the incredible hrs/travel we have to work to earn those salaries, I pay a nanny $60K +(inclusive of taxes, car, and payroll costs) of after tax dollars. I have a decent sized mortgage, not jumbo, but still. Take that all together, and I too am shopping at Target, coupon clipping, not going on vacations other than to visit family, etc. We have savings, which is great, but which have lost a lot of their former ‘value’. So has my house, which is nice but by no means ginormous or fancy, or even fully furnished. We both drive 10 yr old cars, and I watch our cash budget every week. I am definitely not buying the great bags and suits I see on this site and swilling champagne…

        IMHO, we have a good income, currently, but we are not “rich” or “wealthy”. This artificial $250K magic “rich” threshold that seems to have been accepted in the public domain is laughable. The fact of the matter is that if my taxes go much higher, me working for my lower salary, and paying my nanny/commute costs, will no longer make sense, and I will let her go. She is older, with no retirement savings, and definitely, not rich. She will be worse off. And of course, the govt will get less $$ from me too.

        To answer the Q, to me, “rich” is about a good, high net worth (including some liquid, vs tied up in a house or inaccessible retirement assets) of several million $$; the ability to spend without worring (not paris hilton style, but not worry about a $100 sweater or dinner out); and freedom from risk/fear of losing it through loss of a job etc.

        1. Of course, the tax increases we’re talking about are only on the income made above $250k, so for someone like you, you’re not talking about much of an increase. So whether we’re defining you as “rich” or not seems slightly pointless in this debate.

          1. Right, but she seems to be right on the cusp of whether it even makes sense to keep working, so an extra couple thousand in taxes could be the final straw. And while I generally agree with your post below that these are “unimaginable luxuries” for many people, taxing this family at a higher rate and motivating them to eliminate some of these “luxuries” is not going to help anyone – particularly not the nanny or the government. Declines in employment are not good for the economy.

          2. I’m sure there are economists on this site who can handle this one better than I can, E Anon, but I believe that’s a fairly inaccurate way to frame the tax debate. Everything I’ve read indicates that when taxes rise, consumption is lowered (it’d have to be); it’s not a linear relationship though, especially when you’re talking about upper income folks. Those folks tend to save slightly less instead for the most part. Meanwhile, the tax money is being put to work in different ways. So it’s not really accurate to say that we all benefit by taxing the highest earners less so they’ll hire more servants – in reality, it doesn’t work out that way.

            Now granted, it may work out that way in her particular case. Though personally, if I was only realizing like $2,000 from working I’d probably not bother to begin with. You could probably save that much on not buying lunch out or work clothes or worrying about commuting. So call me skeptical.

          3. I think, based on reading the comments to some of the links in the original post, that for Anon IB, if she has $25K in taxable income over $250K, that would amount to $1K in increased taxes under Obama. Since she already said, though, that she and her husband are contributing $32K to retirement (and I assume this is primarily pre-tax), then she is already below the $250K cut off and not subject to the pre-Bush tax rates on the highest marginal rate at all.

            I think it’s important to keep this in mind. I know that my husband and I are “rich” by any reasonable standard, and the only time I ever don’t feel that way is when friends who earn more than we do or my family shrug off doing things that we have to think hard about. Somewhat by choice, I earn just more than half of what my husband earns (which is about $140K incl. bonus). I often feel that if I earned similar to my husband (this is not at all unreasonable, I just chose differently), then I’d really feel “rich” instead of just knowing that we are. What I find interesting is that Timothy Noah over on Slate just wrapped up a series on income inequality. His 8th entry talked about a way to divvy up the top 10% of income earners so that $100K+ is “sort of rich” (top 10%), $368K+ is “rich” (top 1%), and $1million+ is “stinking rich” (top .1%).

            The link to his post is here:
            http://www.slate.com/id/2266025/entry/2266513/

        2. Also, I don’t mean to belittle the decisions your own family has to make, but I do think it’s worth pointing out that the decision between having a full time employee vs. not working and living off your husband’s income is a dilemma, but it’s a high class dilemma. For most of the people in this country the choice is one unideal form of child care or another – patching together a variety of unaffordable options, shift work, and relying on family members who may or may not have time to help – because there’s no choice and money has to be made. Combining that with fully funding your retirement, owning a house that is presumably not in danger of being foreclosed upon, and having two cars and we’re looking at a very different picture than most people in this country, most of whom still consider themselves “middle class.”

          I don’t think it’s so much that people are offended by high income earners not characterizing themselves as rich. It’s the characterization of nanny salaries and fully funded 401ks as hardships rather than the unimaginable luxuries they are for most people that is difficult to swallow.

          1. But the question was not “are you comfortable?”, which is what you are describing, but “are you rich?” Presumably, the rich can afford a nanny and work or not work, and invest in their 401k. They don’t have to choose.

        3. Is it average to pay a full time Nanny $60k? That sounds incredibly high. I don’t have kids but my friends that were nannies used to make about $30k.

          1. The employer also has to pay medicare tax, social security tax, and workers’ compensation insurance for the nanny. In some parts of the country, it’s customary for the family to pay 100% of these taxes for the nanny.

          2. Oh yeah, the first 100k I make goes to paying the nanny (cash, my share, all that and all that)….never mind the Zoe Baird type issues….yes, it is ‘average’ to pay a really good, full time, drives the kids where they need to go, knows the pediatricians phone #, can make decisions on the spot, feed ’em ezmac or pizza delivery a couple nites a week, keep the place from falling in on itself (ie, direct handyman and lawn man), nanny: DEFINITELY costs $60k year. Hate to break it to ya…that’s starters. Let’s discuss serious laundry management (three kids = machines never stop), medical appts, tutors, late nite client dinner coverage on a random Tuesday, and oh yeah, wanna Saturday night dinner date with DH (or just a few hours on Sat. afternoon to pay bills, etc) – gonna cost more…

    2. I think no matter how much money I have I will never consider buying a $100 sweater. I just can’t do it. It’s in my psyche. And I will probably always wash and re-use ziplock bags, for which my husband teases me. But as I remind him, it is habits like this that make the rich rich, eh?

      1. Ha, I do the same thing with the Ziplocks, and get the same teasing! (I think he’s gotten used to it by now, but he used to grumble like crazy over having to dry them).

      2. I completely agree with Midori, even down to the ziplocks. I could not allow myself spend $100 on a sweater, but that means I have money when emergencies arise and I don’t have to think twice about spending it then. Being “rich” to me is being able to spend without thinking. Being financially “secure” is not having to worry when it comes to unavoidable expenses I could never have planned for. I have a lot of security, and my friends with expensive (beautiful!) wardrobes usually are scrambling when an unforeseen doctor’s bill arrives. I coudn’t live with that stress.

        1. I will spend $100 on a sweater if I like it, but I definitely wash and reuse ziploc bags :)

    3. I’d consider you rich but not wealthy. But you’re well on the way to being wealthy, and I’d guess you got some help on the way since you have no debt. Congratulations on the great job success at such a young age.

      1. This is going to be an interesting conversation as it seems – already – that everyone’s definitions are very different. There are lots of people who spend freely, go on vacation, buy $200 sweaters, and don’t worry about saving for their kids’ education who are nowhere close to rich, just irresponsible with their money & on their way to being in debt.
        For my two cents, I agree that there is a difference between rich & wealthy; and, I think that what feels “comfortable” is going to vary for people based on their personal needs, expectations and standards.
        And, fair or not, whether you feel rich/comfortable/whatever also has a lot to do with how you grew up, where you live, and what the people around you do. But $350K for 2 with no student loans does sound pretty sweet, esp. at 26 & 28!

      2. Yes, I should have acknowledged the help – we both had parents (plus some scholarship money) that paid for school.

    4. OMG, at your age I was living with roommates in an apartment and making a few dollars an hour.

      You are rich indeed.

    5. I agree – comfortable is when you can have most of what you want with some juggling, wealthy is when you can spend without recourse… which I realize means that very few people really are.

      1. I think comfortable is when you have everything you need, rich is when you have most of what you want, and wealthy is when you can spend things without recourse

  9. I am – in all seriousness – completely unfamiliar with the female demographic who “aspired to be wealthy and have truly comfortable lives have preferred to marry well rather than pursue their own careers.” It has never for a moment occurred to me that anyone else would ever be paying my way. Ever. So, I guess my husband married well.

    I make a reasonable living as a lawyer, and we have everything we need and most things we want. Then again, my wants are pretty simple, and I’ve never really been motivated by money. The best things in life aren’t things.

    1. hmm interestingly, I took Kat saying “marrying well” to mean marrying a nice man and cultivating a relationship which can sometimes mean the expense 80-90 weeks. I guess that shows how unfamiliar I am with the idea of a woman marrying a man to be comfortable economically! Now that I read your comment I realize she probably did mean marrying as a way to achieve financial stability and am feeling vaguely offended for women, even though I don’t doubt that women like that exist somewhere. I guess I have very successful hardworking friends!

    2. Sadly, I know several women who fit this demographic – attended law school solely to find a husband – no intention of taking exam/working – one finally took/passed exam 3 years after graduation when husband still hadn’t shown up – makes me sad.

      1. I also have a friend who is in law school for her dual JD-MRS degree…and it makes me sad too…

        1. Going to law school to marry well is a pretty bad idea for beyond even the obvious since most of my male colleagues have married far less-educated women.

      2. My law school roommate had the goal of marrying well, working just long enough to pay off her debts, and then becoming a stay-at-home mom. She aimed to be on the boards of various charitable/housewifey organizations. Oddly, she wanted her husband to make enough money to send her kids to a private religious school through high school, but she felt no obligation to save for her children’s college educations because her parents’ hadn’t paid for her BA or JD, so she didn’t think she had any obligation toward her kids.

    3. Yep, I know some whose ultimate career goal is “trophy wife.” To each her own, I guess. But maybe that’s a touch different from hoping to have a husband who make enough to allow you to take off some time to be home with young children?

      1. I think nowadays most women do not think, “my career plan is to marry a man who has a career plan”
        But that said . . . a lot of women do end up pursuing said plan, whether consciously or not.

      2. If it’s OK for a woman to hope to have a husband who can make enough to allow you to take some time off to be with the kids, is it OK for a man (hopefully a different one from the husband in my first sentenece, I guess) to want to have a wife who would make enough to allow him to take time off to be with the kids?

        I’m not snarking, I’m genuinely curious about reactions to that. To me, it’s not only reasonable, but my (and my husband’s) plan (although I doubt that was his “plan” before we met, but we met young). But I get the impression that a lot of women don’t see it that way, and seem to think that the man should always be able and willing to be the provider, while, for the woman, it’s optional. (I got a lot of weird looks in law school, from women, when I mentioned this plan.)

        1. I think its a great plan and that there is nothing wrong with it at all! This was our plan too, but at this point, as we are starting to get serious about the babies, my husband is enjoying his career enough that we’ve decided to pursue a 2 career plan.

        2. I think it’s absolutely okay. So long as “hope” does not equal “unspoken expectation.” Both partners need to talk about their goals and hopes (preferable before matrimony, but do what you can), and keep talking about them as they change over time. Both my husband and me are totally willing to sacrifice/put on hold our professional goals for the sake of the family if needed, and I think both of us would be willing to cut back expenditures if the other really wanted to stay home with our son. As it is, we love are jobs and feel that daycare is a great place for our son, but we do try to keep the communication open in case that changes.

        3. My fiance and I are discussing a similar plan if/when we have children. I’m not sure that I would want to stay home with them, and he has a much more flexible career that he can do from home/part-time/on a consulting basis.

          While nothing is set in stone yet, he’s ok with the idea because 1) he supports my decision to stay in workforce (and would be equally ok if I changed my mind, so long as we had the money to support our family) and 2) he thinks he would be able to maintain his skill set even working on a part-time basis.

          So, it’s not exactly like he’s going to stay home with the kids full-time, but maybe when they’re really young.

          A lot of people think this is weird. I think it’s tied directly to gender stereotypes and perceptions of women as nurturers and men as providers. *How could a mother NOT want to stay home with her kids?! Doesn’t it make the dad less of a man if HE stays home?!* Oh the horror!

        4. That’s exactly what a few colleagues are doing. Unfortunately I’ve seen too many instances of the trophy wife or the rich/bratty expat wife (work? what on earth is that, dahling?) where I live, to be surprised by the ‘plan to marry up’ syndrome.

          I would probably be considered rich by most posters…dual careers, 1 kid, no debt except manageable mortgage, lovely condo and >$1m annually thanks to DH’s banker pay (but then we’re always living on the knife edge of hiring &firing that most people won’t understand unless they’re married to bankers or are bankers themselves!).

          That said, it’s probably my surroundings (super wealthy country) or my 3rd world background that won’t let me ever consider myself rich.

    4. Oh man. I totally knew those girls in college/law school. My friends and I always said they were there looking for their “MRS” degree. I even had a female law school classmate look at me another classmate and say “If it wasn’t for you damn feminists, I’d be happy to stay home and make babies.” In the back of my mind I was secretly asking her, “What the heck’s stopping you?” Sigh.
      So yes, those types do exist. But I like to think that in circles of “overachieving chicks”, they’re kind of rare.

    5. I don’t really see what’s wrong with women who want to marry “well” going after what they want. It’s a different form of ambition, but to each her own.

      1. I tend to, sort of, agree. I would certainly not respect a woman who said that her main criteria in a man was wealth, or who pursued/married a man that she was not interested in but for his wealth. But, at the same time, I would not respect a woman who married someone who could not support a family, unless she planned to be the supporter without complaint, nor would I respect a woman who married/made babies with a man who couldn’t get his stuff together (deeply in debt, couldn’t hold a job, never knew where the next meal was coming from, etc- which is different from just being poor or having a low income) (wouldn’t respect a man in those situations reversed either).

        I think that, when you think about creating a long-term commitment with someone, you do have to think about the big picture of the type of life that you would have together, is what I mean.

        1. Former BigLaw lawyer here — interesting that you say you would not “respect a woman who married someone who could not support a family.” I married a man who certainly, could not support a family — income of $60K and school debt (for a master’s degree that, at this point, is worthless) to the tune of $44K. On the plus side – he lived within his means ($600 for a room in an apartment shared with friends in Brooklyn) and had the savings to buy me my engagement ring. I had about $400K in the bank when we met and an income of close to $300K. I fell in love and said to myself, LOOK, what is the point of all this goddamned money if I can’t marry who I want? Wasn’t that one of the points of women’s lib? So we married. (And I feel like I hit the jackpot — he is the best. guy. Seriously. Compared to those douchebags I dated who were threatened that I might make more than them?)

          Do you respect me less that I didn’t pass him by?
          I

          1. You should re-read what I wrote- I wouldn’t respect someone who married a man who couldn’t support a family, unless she planned to be the supporter without complaint. (It was right there in the same sentence, I don’t understand how you missed it.) Sounds like you did plan to, so, no problem there. (For what it’s worth, as I’ve said in comments above, I plan to support my husband when we have kids.)

            That being said, I don’t see someone who makes 60K, even with school debt and an expensive area to live in, as “unable to support a family.” When I say support, I mean support, as in, provide necessities (food, reasonably safe dwelling, healthcare), not fancies.

      2. I, too, don’t see much wrong with it. If someone’s goal in life is to not work and to spend their time with the kid(s), going to yoga, and shopping, who am I to judge? Not my cup of tea, or that of most of my friends, but those girls probably feel the same way about our choices.

    6. UGH – I was at a networking event tonight that had some of these ladies trolling around. When everyone’s name tag says where they work, their has nothing below their name except “member.” You know they are not just looking for jobs b/c they are there in short short skirts, low cut shirts, and sky high heels. Gotta love it. I’ll give them credit, great way to meet professional people.

      1. But didn’t you still want to spill a drink on them, just a little bit?

        I seriously can’t stand that, the potential trophy wives trolling the professional event. I want to tell them to leave the professional associations alone (because inevitably, the hooker-bots draw attention of men that would actually be useful to talk to if they weren’t staring into some chick’s overexposed cleavage) and get jobs as a pole dancers. They’d make some of their own money, meet men who have money, and at least they’d be honest about what their goals are: trading sex for money. And that would leave the rest of us free to actually get some professional networking done.

    7. I’d say up to 1/3 of the women in my class went to find a wealthy husband. When I got to law school I just couldn’t believe how my female classmates were just so obsessed with finding the right husband and having kids ASAP.

      1. Forgive me if this is a dumb question. But isn’t law school pretty hard, and pretty expensive? Wouldn’t there be a cheaper and easier way to meet the “right kind” of guy, than going through law school to do it? That’s puzzling, and I am sure infuriating as hell :)

        1. It was infuriating being that I was an older student who was perfectly happy to be single while everyone else acted like people my age who weren’t married were total lepers. I felt like I was in some far earlier decade. What was interesting to me was that the really overt husband hunters didn’t come out of law school married or in a serious relationship. Their desperation was so well known that their male classmates really weren’t interested.

        2. I think a lot of these women want to be well-educated and may even work for a year or two, just not long-term.

  10. Sweet Hot Justice is discussing the same thing: http://bit.ly/9PQg0k about how a person can feel poor on $120k in Manhattan. I’m going to ponder my own situation a while and respond later with a more anonymous handle.

  11. I am very motivated by money because my parents were poor. I witnessed and lived it firsthand – the constant worry about whether they’d be able to feed, clothe and house us. I never want my children to feel that way so I work hard, and I have worked harder than many of my friends from more affluent backgrounds because I have experienced that particular fear. It’s nice to say money doesn’t matter, but I think most people who say that have never had to truly worry about it.

    To the original point of whether a certain number is “rich,” it really does matter where you live. I live in San Francisco and my sister lives in Austin and she and I agree that my husband and I would be “rich” in Austin if we had the same salaries there, but we’re basically just middle class here.

    1. Agree about people who haven’t worried about money. I think it’s crazy to look down on someone for taking a job for the money when they’ve struggled for money their whole lives, just as their parents before them did. Especially when the same people criticizing are from comfortable backgrounds.

      1. I think it is crazy to look down on ANYONE for taking a job for money, regardless of their background. To want to earn wealth honestly to support themselves and their families is a noble endeavor for anyone. Period.

        1. Agreed. I still vividly remember a guy in my law school class who would just go on a tirade about people who were just “in it for the money.” I thought it was crazy then, and I still do – who is he to judge anyone else for taking a $160K job that they worked for years to achieve, regardless of what their motivation is?

          1. there was a guy in our law school who was intent on doing public interest work — great for him. but at one year’s EJF auction he was talking about why it was so important that we support the cause so that feelow students didn’t have to be whores to law firms.

    2. Yes, I absolutely agree that people who say money doesn’t matter have never had to really worry about it. My mother made a lot of poor decisions leading to barely living above the poverty line, I remember what it felt like to have our house foreclosed on and not know what was going to happen to us, and I never, ever, want to be in that situation again. Some of my friends look at me like I’m crazy when I say that a guy’s salary matters to me or that I’d never have kids until I have a good chunk of money in the bank, but they don’t have any idea what it feels like to come home from school to an empty fridge.

    3. I agree in reference to where you live. I live in DC and grew up in Ohio. What I make here would squarely place me in the “doing well for my age” category if I made the same amount in Ohio. For DC, it’s just average. I mean, my cousin just bought a house for like $45,000. It’s small, but it’s nice and cute and in a cute little neighborhood. My mom and I joke that $45,000 would buy you a parking spot in DC.

      1. This. True story:
        Recently my dad and were talking about the differences in costs of living/property values in different areas (thrilling, I know). He told me how when we moved to FL back in 1985, he and my mom bought our house (which he still lives in) for about $80,000. Around the same time, an AF buddy of his bought a house about the same size. But in San Francisco. For 4x the cost.
        Eeep. I’ll stay right here, thank you.

        1. Except that $280k house in SF has probably doubled in value since 1985. My parents bought a small house in an area real estate agents like to call “in transition” in 1985 for about $400k and it’s worth about $700k now in the still-transitioning area, even after the real estate crash.

          1. I totally agree (and apologies if I came across as knocking SanFran, my dad grew up there!). My parents’ house is in a community that, at the time was relatively small, underdeveloped, and largely nothing more than a bedroom community to a larger near-by city. Since then, it’s expanded quite a bit – as too have property values.
            I was just pointing out the differences in cost of living in different regions. I could see how $100K a year might not get as far in places such as SanFran, Chicago, and NYC, as compared to central FL.

          2. Not at all JessC – SF has crazy real estate prices, as does Manhattan and a few other cities, to a degree that I think people not in these areas may not understand. I have such a skewed view of real estate from where I grew up.

            I know I’m going to need at least $150k for a down payment on a house, and until I get to that, years from now, I can’t even begin to consider the possibility that my biglaw salary makes “rich.”

  12. I think I will feel rich when we (hubby and I) have about $2M in liquid assets. Right now we are at about $450K including retirement assets.

    I was very lucky not to have any loans – my parents paid for both my college and my law school – plus I worked in biglaw for 5 years. So we have been able to save for retirement, buy a house (with a gigantor mortgage), and have 2 kids. We are comfortable but certainly don’t feel rich yet. Are we in the top 5 or 6% of income earners? Yes. Do we have a large net worth? Not yet (at least not to me).

    I read the original post that the UChicago guy wrote, and he struck me as a little whiny, or entitled – eg he NEEDED to pay for private school for his kids, etc. I think that is a lot of what has people up in arms.

    Re: what Kat said about women wanting to make lots of money – I am certainly one of those people who doesn’t love my job and would quit right away if I won the lottery. I would be happy to become a SAHM if my hubby started making more, which is quite possible. I also picked a job without a ton of upside potential (at a small firm, etc), in order to be able to spend more time with my kids while they are little. I don’t need the $1M/yr paycheck as much as I need to be home in time to feed the little ones and put them to bed.

    1. Speaking as a Chicagoan, he’s saving on huge amounts of commuting time (and associated expenses) by living in Hyde Park, but the tradeoff is that it’s an area that can get pretty dicey block by block and has terrible public schools. Anyone with the means to live on a nice block in that area and send their kids to private school will do so. The people who are up in arms are clueless about the realities of city life.

      He could move to the suburbs or a nicer neighborhood, but then he’d have to spend more on babysitting, gas, car maintenance, etc, plus he’d have a couple of hours less time per day spent with his wife and children; depending what area of medicine his wife practices, they might actually need to live within a few minutes of the hospital.

  13. I’m an attorney for a non-profit. My salary is quite low compared to private attorneys, but I also live in an area with a low cost of living. And I’m single, no kids. I really like my job, though it requires some sacrifices. (i.e. I clean my own house and only eat out once per week, limit impulse purchases, etc.)

    I budget carefully and buy groceries/household cleaning items/toiletries on sale and with coupons so that I can have money to buy nice(ish) clothes, travel, etc. I drive an older car that is paid for and will continue to do so until it requires a repair that doesn’t make financial sense. I have no consumer debt. My student debt is largely payed through an LRAP. I’m certainly not rich, but I’m very content. Probably a huge part of that financial contentment is the result of serving clients close to or below the poverty line, so I realize how lucky I am to have plenty of food, a nice place to live, good insurance, and a healthy savings and retirement account.

    Summary: I can provide for all my needs and enough reasonable wants to feel satisfied, my debt is low, I don’t have to worry about whether I can afford the bills, I love my job, and I realize how lucky I am to be financially stable. Life is good.

  14. This is such a complicated question. One of my first thoughts is that, in my experience, the grass is greener: when I was in grad school I was always worried about money, and so were all of my friends, and I constantly thought “give me whatever soulless job, I am just so sick of being anxious about paying the bills.” Now that I’m out and gainfully employed, I often find myself thinking I would trade this kind of comfort for the fulfillment (and awesome company) that I had during those meager times. I think to some extent both mindsets are B.S….but I am still trying to find the golden mean.

  15. I work on the administration side in a small consulting firm for a salary in the mid 50s. I’m a trained librarian, which means I have a graduate degree and the associated student loan debt, and additionally I live in New York, so rent isn’t cheap, and neither is anything else.

    So I don’t feel rich, but more importantly for me personally is that I don’t feel poor. I can’t buy whatever I want, but most of the time, if I want something, I can make it work. I can’t shop at Saks, but I can afford to stock up on cardigans when Loft has a sale. If I need a new pair of flats for work, I can actually buy them instead of making the ones that don’t work anymore function until the next paycheck. I can go out to dinner if I want to.

    These all sound like tiny things, but a year ago I was dealing with four day work weeks and a month of furlough in the summer. I was functioning with a reduced salary supplemented with a small unemployment check, eating a lot of beans and rice, and staying up late into the night budgeting every last dime.
    So not feeling poor kind of feels like a victory right now.

  16. Positive net worth in your early 30s is amazing, Kat. That means you have more in savings than you owe on your mortgage… thats’s a beautiful (and unimaginable) thing to me!

      1. Because in the upper tax brackets, mortgage interest may be the only tax deduction you can get.

        1. unless you are AMT’ing out of the deduction anyway. We paid off our mortgage when we realized this was happening and wasn’t likely to stop.

          1. Then you should really talk to a financial consultant who can explain to you why that’s foolish.

          2. Wow. I’m sorry you feel the need to tell other people that they are foolish for making decisions that differ from yours. I guess I’m also foolish for paying off my student loans early? What does it matter as long as I’m happy with my decision? I was simply asking a question and offering a different perspective, not telling anyone they are foolish for their choices.

          3. Having zero consumer debt is a good decision. However, depleting one’s savings (a liquid asset) to pay of a mortgage (non-liquid and not always easy to turn into a liquid asset, as the housing bubble burst has shown) is not a smart idea, especially when one also takes into account the tax benefits associated with a mortgage and the fact that mortgage interest rates are currently quite low.

          4. ah, you’ve obviously never had a mortgage. Do you think no one should ever have a credit card, or do you think that establishing credit is important

          5. Not sure why you assume I’ve never had a mortgage. I do think establishing credit is important, and I do have credit cards (which I pay in full every month).

          6. But what if your assets are earning a higher return than your mortgage interest costs (remember, it’s a tax deduction which further lowers the cost of the interest) ?

            Then you’re an idiot to pay off the mortgage since you’ll be making less money by doing so.

          7. Well, technically, you shouldn’t pay off debt if you could make more investing the money. If you’ve got an interest rate lower than (in this market) say 4%, then you should invest your savings where you’ll likely get a better return. An interest rate of 2% (which many olders school loans are) is almost free money and really (if you can stomach it) shouldn’t be paid off any earlier than necessary.

        1. http://www.daveramsey.com

          He has an entire philosophy of why debt is not good, and why the tax deduction you receive from mortgage interest is not always beneficial.

          Besides, once you pay off debt, you can quickly take the money you were using to pay off debt and sock it away in savings. I cannot wait til my student loans are paid off and I can put all of those payments towards savings.

          1. Part of that “no debt” thing is based on Dave Ramsey’s religious value system, which not everyone agrees with. I don’t think going into more debt than one can afford for a house is a good idea. However, as long as equity is being created, not destroyed, I don’t think mortgage debt is “bad debt.”

            And, to the point someone made above, mortgage paid off 0r no, someone can still take your house if you have no money. If you fail to pay your property taxes, guess what? The local government will put a lien on your house and then can sue to take it from you for nonpayment of taxes. You can also have your house condemned if the property falls into serious disrepair because you don’t have the money to fix things. Not to mention what happens to people living in areas where they sign a homeowner’s agreement. Having a paid-for house is not an automatic “well, at least I have somewhere to live if I run out of money.” You still have to have money to live in a house, even without a mortgage.

      2. Tax benefits. We could have paid off our mortgage with an inheritance a few years ago and our accountant strongly advised against it. Especially if someone doesn’t have kids, having that mortgage-interest deduction really helps.

      3. Because if the interest rate is low enough on the mortgage, you can use that money that would have paid it off on other things that might earn you more. It all depends on your threshold for debt (I would rather have no debt and pay it all off now with our savings, while my husband would rather have a large, easily accessible savings account and the manageable debt we do have) and what interest rates you have.

        1. If you refinanced or obtained your mortgage at the right time, your mortgage interest rate may be lower than the interest you could make by investing that money. Also, cash flow is as important as assets, as any business knows. Not having enough cash on hand can be very, very expensive. Sometimes it’s a better idea to have a little debt in order to have some liquid resources available.

          1. This is what I was trying to say, only you phrased it much more artfully. I think I need more coffee.

          2. No, you said it well, Anon1. :-) I was just too impatient to read it carefully. My comment should have said, “Yeah, that.”

    1. Just had to think about that a second — my definition of “net worth” is coming from Mint.com, which tells it to you at the bottom. But net worth is assets and liabilities — and assets includes the estimated cost of our apartment.

      Also, re: paying off the mortgage — keep in mind that a lot of people who have assets have them in their 401k, so you can’t touch it until a certain point. And there is that whole “rainy day” theory, also — when unexpected bills come ’round everyone seems to prefer being paid in money versus being paid in apartments. ;)

      1. Very, very true :) I doubt you can pay a bill in lamps and coffee table books!

        Having been out of work once at a point when I still had rent payments to make monthly, though, and knowing someone who is currently out of work with a mortgage payment to make every month, I do think there is some security to be found in knowing that, if the sh*t hits the fan, no one can come after the roof over my head b/c I own it outright.

        1. Not to be Debbie Downer, but even if you pay off the mortgage you’ve still got property tax and condo fees/maintenance to pay, so if you went broke you could still end up with a lien against your condo if you couldn’t pay those bills. It’s necessary to have a good chunk of savings, no matter what.

    2. To Lawgirl: Positive net worth means that one’s total assets exceed one’s total liabilities. It doesn’t necessarily mean one’s “savings” exceed the mortgage amount. The assets include the home’s value, which in these times may be lower than one thinks. As several posters have pointed out, assets like home equity are not liquid, while debts must be paid every month. Even if someone does have savings enough to pay off a mortgage, converting liquid assets to illiquid ones like home equity wouldn’t make me sleep better at night. Finally,”savings” may include retirement accounts which have tax deferral benefits and probably shouldn’t be liquidated if they can appreciate while deferring income taxes.

      1. @Anon in Mpls – I see your point re: net worth as relates to the value of your home. For 99% of folks, if you net it out (home value vs. mortgage owed), there’s likely to be a negative net worth, all things being equal. Beyond that distinction, I think Kat acknowledged that she could pay off her mortgage if she cashed out her “assets,” (401k’s, savings, letc) but she has chosen not to. Either way, an enviable position!

  17. It’s interesting about starting salaries vs. current situation. I was offered $38K at my first job and as a college student living on $5.50 an hour (and I paid almost all my own bills; I was about 80% self supporting in college and incurred no debt), it seemed a fortune and I couldn’t imagine how I would ever spend that kind of money. Now, of course, I have a hard time visualizing how I would live on that kind of money. I could certainly do it; it’s not like we couldn’t make ends meet, but it would be a significant lifestyle adjustment.

    I don’t feel rich because we don’t have a lot of what I would call truly discretionary income (read: money to play with), but I realize that we are well off, especially compared to most of the population. We have little actual play money because we pay extra on our mortgage and we tithe 10% of our gross income to the church (which comes to ~17-18% of take-home pay). But we have no debt aside from the mortgage and a good start on a retirement nest egg, so I have no complaints. We don’t lead an extravagant lifestyle but we do have 4 bedrooms (for 2 people), every other week housekeeper, and other things we could easily downsize if the need arose.

    I strongly believe that wealth is tied to net worth, not income. Someone with an income well into six figures who spends more than they make , with significant debt, is not rich, in my opinion. One layoff notice and they’d be filing bankruptcy. On the other hand, someone with a small income but plenty in the bank is rich to me. They are well prepared for any eventuality.

    I don’t love my job, although I like it well enough. Some days I find myself dreaming of early retirement, so I feel quite sure if I found myself with some sort of windfall, I’d be making my exit. I’d love to have the time to volunteer regularly, spend time with friends during the day, work out more, and other personal things. If I could do those things and maintain my current lifestyle without having my current job, I suppose I’d feel quite rich then. :)

  18. I don’t know how many of you read the article about this on Above the Law by Elie Mystal, but I’d suggest you do so. He manages to convincingly make the case that $250k a year is hardly even middle class, by describing how he can barely manage to barely cover the expenses of two people in New York with that sum of money. I find that pretty amazing.

    I work now so that eventually I won’t have to. As my dad says (in a bad Scottish accent imitating my grandfather), “If it weren’t for the money, I just don’t think I’d be doing the jaahb.” I will be sparklingly happy on the day I can finally spend my “office” hours puttering around in my garden and with my (future, hopefully) children. I’d rather have that, after working hard and saving everything I can, than a closet full of beautiful clothes and shoes.

    1. I read that article and the thing is, I feel like no matter how convincingly one makes that case, it’s hard to do so when you look at what the actual average incomes are, even in New York. I know student loan debt is a huge burden, but even when you subtract the monthly payments on $200k of student loan debt from a $250k income, you end up with a total several times higher than what the average family makes. How can that not be upper middle class at the very least?

      1. I completely agree. It blows me away. I’m trying not to be too judgmental but it just seems irresponsible. (Coming from a small town girl who grew up in a family of 5 on less than 20k/year, but still.)

      2. What I was trying to say (but didn’t) is that I can’t believe he made it a convincing argument. :)

      3. Again, it depends on how you define rich. I think Elie and his $250k are a lot closer to “average” than he is to what I think of as the truly rich, like his example of Michael Bloomberg. Taken another way, I as a Biglaw associate have a salary that has far more in common with my public interest/government friends’ salaries than it does with the salaries of the partners at my firm, who make an order of magnitude more than I do. If you define rich as being able to buy whatever you want whenever you want it, I’m not rich and neither is Elie. If all rich means is that I don’t have to worry about where my next meal is coming from, fine, I’m “rich,” but I think rich means more than that.

        1. Yeah, for that reason I don’t think it’s particularly productive to try and pin down “rich.” Just, the idea that 250k is barely middle class or hard to get by on or not upper middle class or anything like that I think is hard to justify.

          1. I agree that, as a practical measure, we are probably never going to reach consensus on what constitutes “rich.” It’s yet another example of how she who defines the terms wins the debate. I mean, if rich means “I can afford to do or buy whatever I want whenever I want it,” then sure, virtually no one is rich. And that seems to be the definition that lots of people (like the U Chicago law professor whose blog post set off this furor in the first place) subscribe to.

            I do think, though, as a general rule, that that definition’s biggest problem is that it defines the term by looking *up* the income/wealth ladder, and not *down.* As long as a person is comparing herself to Warren Buffet and Bill Gates, up there on the top of the heap, of course she is going to feel, at most, upper middle class. And she is going to miss the fact that she’s better off than 80% or more (or whatever percent) of everyone else in her city, state, country, and world.

            Words mean something. What is the word for expressing someone’s financial situation in comparison to that 80% (as opposed to the top 1% or even 10%) if not “rich”? And isn’t the difference between the top and bottom quintile just as significant (if not more so) from a social perspective than the difference within the top quintile? Maybe we need a different word for the likes of Bugget, Gates, etc… Like “capitalist nobility”? Just thinking out loud here. Then maybe we can resume using the word “rich” in a way that actually has some practical utility and doesn’t merely exist in the realm of unicorns and leprechauns. (that’s a joke, not a slam, btw).

          2. Kristen I completely agree. I’m actually kind of shocked that people don’t consider themselves rich with huge salaries. Bill Gates is something else completely. You summed up my feelings perfectly.

      4. Just a PSA for those who have not had the full load of law school debt, but my husband’s minimum payment for his public and private loans were around $1,300 a month. That’s a full rent payment for a lot of people in this country! That being said, the big law salary allowed him to pay off $3K a month and pay down the private debt in 3 years.

        1. Yeah, I was factoring that in and I definitely think that should be included – I pay more in student loans than in rent myself and it makes a huge difference in my quality of life. But even if we subtract, say, $20k in loan payments a year from a $250k income we’re talking a very high income relative to the median.

          1. And then there are those of us that make $20K in loan payments a year on a $55K income… thank God for public interest loan assistance programs! My private loan payment alone exceeds my monthly rent.

        2. I rent a lovely 1500 sq ft townhouse w/ a garage that is less than 5 years old, and your husband’s loan payment = 2.1 months of my rent! The differences in cost of living are so amazing.

  19. Well, they just came out with a study that says you only need to make about $75,ooo a year (household) to be happy. Any more money than that and your happiness does not go up, and at certain levels it goes down. Currently, we’re about $50,000 over the “income happiness threshold” in an inexpensive part of the country and I think we’re doing fine.

    We have a fairly large older house in a decent neighborhood that is worth more than we owe on it. We have two cars that are paid off – they are 4 and 6 years old and still running fine so we’ll hang on to them for awhile longer. I never worry about where the money’s going to come from to pay bills, buy food, or buy clothes (necessary clothes – “fun” clothes are another story). We do wear nicer clothes and have nice accessories and some fun toys like iPods, touchscreen phones, an oversized flatscreen TV, etc. We can afford to send my kid to a reasonably-priced private school, not the best ones in town, but still good. We can take a fairly nice vacation once a year. We have money in retirement and college accounts and more money going in every month. We have liquid savings in the five figures. We have a little bit of debt, mostly student-loan. We have health and life and homeowner and car insurance with ample coverage for emergencies.

    By most standards, are we rich? Probably. To someone making ends meet on $40,000 a year with two kids to feed, I’m sure we seem rich. Do I think we are rich? No, I think we are comfortable. And I’d rather be comfortable than rich, because from what I’ve seen, a lot of “rich” people are actually leveraged to the hilt, living on credit and waiting for the other shoe to drop. We have great credit because we pay every bill on time, every month. We could live more lavishly than we do but what’s the point? The only hedge, these days, against disaster is having a financial cushion between you and complete and utter ruin. Who wants to live on margin? Who wants to constantly worry that one unexpected hospital visit or job loss is going to end up throwing the family out on the street?

    If I was making a wish list, far down after I had listed my wishes that all my family members and friends stay healthy and don’t get cancer, I would wish for a bit more liquid cash to travel. But that also involves time, which we seem short on a lot. We traveled a lot before my kiddo came along and hope to get back to it when he’s older. But one thing we have realized, in the recession, is that the idea of someone working until they’re 70 – or even 65 – is a pipe dream. 50-year-olds are having trouble getting hired. By the time my husband is 55, he either needs to be running his own business or we need to have cash sufficient to cover us if he suddenly gets laid off and can’t find work. And that means forgoing some of the nicer extras, like annual vacations to Hawaii or Europe. And ultimately, I am fine with that.

    So there you go. Am I rich? I don’t think by the media’s standards I am. But I feel rich. And grateful. Every day.

    1. I realized I didn’t really answer Kat’s questions.

      – I do what I do because I love it, not for the money. I’m not really money-motivated although I do like nice things (but I like it even more when I can get them at a discount!). My husband likes what he does, but he’s in it primarily for the money. Money does seem to matter more to him because he grew up very poor, but it translates more into wanting to spend than to save. My parents were big savers and so I picked up that ethic from them. It’s been a struggle to reconcile the two things and it still is.
      – As far as “what makes me feel rich” one reason I stopped a relentless push upwards in my career a few years ago is because I realized that in order to get to what I considered at that time to be “rich” I’d probably have to make over a million dollars a year, and if I was working in a job paying me that much I would have to be at work all the time, probably doing things I didn’t love doing. There are tradeoffs in everything. Ass, grass or cash, no one rides for free. I didn’t want the kind of lifestyle we would have to have to make the kind of money I thought I wanted to make. We aren’t rich but we have time together, and time is more valuable.
      – One more note – while we’re saving some money for my son’s college, we don’t plan on paying for all of it, private or public. He’s going to have to work his butt off, get scholarships, save up some duckets of his own, and do the best he can. He may not be able to go to a private college, unless he finds a way to make it work – and if it’s important to him, he will. I think private colleges are ridiculously overpriced anyway, to an almost stupid level. We’ll give him what I think is a common option – you can live at home, go to State U in our city, and we’ll pay for it. Other than that, make your own way. I have seen a lot of people wash out of college because they had no skin in the game. When it’s your name on the promissory note for the loan, you have an investment in being successful so you can get a decent job and pay it off. Plus, I think he’d rather us save for retirement so we don’t have to mooch off him in our old age. He can borrow for school, we can’t borrow for retirement, and our ability to work until we’re 65 is by no means a given.

    2. Great point on 50 year olds having trouble getting hired. In my mind I need to be finanially ready to retire by my early 50’s because I may not have a choice if I loose my job.

  20. Interesting. I think rich is a relative term. When I was younger it probably meant a lot more because I would fantasize about big houses and fancy cars. As a 20 something biglaw associate I don’t feel rich because of my debt but when I actually think about it, I realize I am rich. I have enough money to pay my debt, take vacations, buy clothes and sustain my love for food. People who make this much money and don’t feel rich are probably thinking of all the things they want but don’t have. Rich doesn’t mean a bottomless pit of money. To me it means being able to live within your means and still have something stashed for a rainy day.

  21. Regarding the last question –
    it different for men?
    YES! At least for most men I know – their egos are SO tied to their money, whether they need it for goods or not. for example, my husband doesn’t want more worldly goods, but he definitely wants to make more money to feel good about himself.. .ugh! drives me crazy.

  22. I worked in Biglaw for four years before leaving for the public sector because the money just wasn’t worth it. I absolutely felt rich when both DH and I were working in Biglaw – we toasted our our glass of wine upon coming home from work (often at 9 pm or later) with “dink dink” (“Dual Income No Kids) – celebrating our financial good fortune. We could buy whatever we wanted, enjoy the many restaurants in walking distance from our downtown townhouse, and buy nice gifts for our friends and families. (We saved a lot and purchased a home that made good financial sense, and thought we were living pretty frugally – one old car, one vacation a year.)

    DH and I both left Biglaw within 8 months of each other, cutting our household takehome to a third of what it was. We’re at 170 before taxes right now in the urban Northeast. We cut a LOT – cable (yay Netflix, Roku, and free over-the air HD!), data plans on cell phones, restaurant budgets, gifts, gym memberships, and of course clothes. We scaled back the “luxury” aspect of our travel – but still go on weekend getaways and are looking forward to driving cross country next summer.

    In doing so we found that in the time in our life when we were toasting “feeling rich,” we were squandering money on gadgets, premium cable channels and DVR, going out to eat, and random crap (read: clothes) bought online to perk up an unsatisfying workday. We don’t miss what we’ve cut (okay, I miss buying clothes sometimes!). We are both home now by 6 pm every day, are loving having more time together, cooking more and entertaining in our home, and were able to adopt a dog who brings us both a lot of love and laughter. Looking back on it, our “feeling rich” (while totally private – we never flaunted it) was pretty obnoxious.

    We max out our 401k’s and IRAs every year, keep a 10k cash emergency fund, and overpay the mortgage on our home and our investment property. We had to buy another car when our job situations changed but both are paid off.

    I guess the point of all of this — sorry, stream of consciousness here — is that “feeling rich” didn’t add a lot to my day to day happiness. We cut our takehome by 2/3, but the daily experience of our current situation is much better to me than when we felt “rich” – and there aren’t many expenditures that I miss (other than strolling to get a sidewalk table at a restaurant and have a glass of wine, and the occasional Gilt yearning). I know that we are still very fortunate to not feel squeezed at the end of the month. I do wish we were able to save more, as the last year has taught me that I want to retire earlier rather than live a more spruced-up life. But we are happier than we were when we “felt rich.”

  23. I am really happy you posted on this subject! I have been following all the various discussions on the internet and am delighted to see it discussed in such a thoughtful place, with thoughtful people. My husband and I spent much of last night talking about it, and we do indeed have different conceptions of what rich means. But I think our differences come more from our different backgrounds than our genders. We are both biglaw associates and our joint salary is $400K. We are both down to our public law school loans (combined 70K), don’t have any other debts, and live a very nice life in NYC. We rent an apartment in a wonderful neighborhood and are pretty much able to do what we want in terms of vacation, clothing, gifts for our friends and family, etc. Even though I am still a bargain shopper and we don’t have fancy vacations and we don’t own a home, I consider us rich. We are aggressively saving and watching our expenses, but do indulge in things that we care about. I guess for me, rich means being comfortable, as a poster above defined comfortable. I don’t think rich means you can buy anything you want or that you do buy everything you want — my parents got rich by being the most insanely frugal people I know. That’s how they got rich! And it hasn’t changed their spending habits at all. They live in a nice house and sent me to private school, but they view taking a $10 taxi as the most ridiculous indulgence ever. My hubby grew up in a more solidly middle class background, and he does not view us as rich. He said he doesn’t think he will be “rich” until he has at least half a million dollars in the bank. It seems an arbitrary line to me, but it was interesting to talk about our different perspectives. I think if you did not grow up “rich,” it can be hard to identify as such, no matter how much money you are making or have saved.

    As for the job question, my thoughts have changed in the last year. I took the biglaw job because it was the best option for getting me to my final goal of working for the government. I thought the money would be nice, but did not view it as the reason for taking the job. Now that I’ve been here for a few years, I have started to like money more, if that makes sense. I love being able to buy gifts for my friends and take trips and treat my husband and just not think about money (and if I thought I would continue down this earning path, I am sure I would spend more money on clothes). I guess what I am saying is that I like feeling rich. Part of the change for me is that I haven’t hated it here, meaning it might be a viable option to stay at a firm, and that I want to stay in NYC and raise a family here. That is a lot easier to do, if you make the mega bucks. Then again, you might want to actually see your family! If and when we make less money, we might consider leaving NYC for that reason…we want our dollar to go further and be able to maintain a nice quality of life.

    In that respect, I agree the initial law prof’s post was whiney. Move somewhere where you can send your kids to public school! If you want to FEEL rich, then you should move out of an expensive urban area. My real issue with this discussion and the tax incraese, is the way working married couples are taxed. If I was not married, I would be below the $250K cap, but because I am, I am over. We got married last year and owed over $10,000 extra simply because we got married. I understand the argument that we are better off financially by being together, but we could have done that without signing the document! Honestly, if I thought we would continue at this earning level, I would have had the wedding, but not submitted the paperwork.

    Phew, that was long. SUCH an interesting thread!!

    1. “My hubby grew up in a more solidly middle class background, and he does not view us as rich. He said he doesn’t think he will be “rich” until he has at least half a million dollars in the bank. It seems an arbitrary line to me, but it was interesting to talk about our different perspectives.”

      This is a very interesting thought. I grew up in a family where we were never struggling, but we were solidly in the lower middle class. We never had vacations or “nice” things; my parents were not able to save for college funds. Reading through the threads above, I think I have a *higher* definition of rich than others do, which surprises me … and I think it is because I am as a result very risk-averse when it comes to money and highly value monetary stability. But then, I probably also seem to have a lower threshold for “comfort” — since, as a result of my upbringing, I can imagine being “comfortable” raising a family on less than $100,000.

      In other words, my “comfort” bracket is very wide. :)

    2. Speaking as a Chicagoan, he’s saving on huge amounts of commuting time (and associated expenses) by living in Hyde Park, but the tradeoff is that it’s an area that can get pretty dicey block by block and has terrible public schools. Anyone with the means to live on a nice block in that area and send their kids to private school will do so. The people who are up in arms are clueless about the realities of city life.

      He could move to the suburbs or a nicer neighborhood, but then he’d have to spend more on babysitting, gas, car maintenance, etc, plus he’d have a couple of hours less time per day spent with his wife and children; depending what area of medicine his wife practices, they might actually need to live within a few minutes of the hospital.

      1. “The people who are up in arms are clueless about the realities of city life.”

        I am a lifelong Chicagoan and product of the CPS public schools. Private school was well above my parents’ means. Going to public school didn’t keep me out of Professor H.’s very own classroom. His comments were ill-informed and I am *totally* up in arms about them.

        1. Your point has nothing to do with mine. If you were a parent living in Hyde Park and had the means not to do so, would you still send your kids to Hyde Park’s neighborhood public schools? I very much doubt it.

      2. Eh, that guy made a whole series of choices – to have three kids before paying off school loans (okay, I don’t know their situation and if this was a choice, but for many people it is); to live in Hyde Park; to send his kids to private school; to buy a million dollar house; to max out his retirement contributions. Some of the choices he’s made might force others (like living in Hyde Park forcing private school), but somehow I find it hard to believe that there’s no decent neighborhood or suburb in Chicago where you can’t either (a) send your kids to public school or (b) pay substantially less than a million dollars for a house. Because either one of those things could have netted him a ton of spare cash even if some of it would be spent on commuting.

    3. @NYC, check back in with us when you hit the wall of kids, work and Biglaw oversupply/layoffs (not wishing those on you or your hubby, but, statistically you should be on alert…) , Ignorance is bliss, my friend, enjoy it – and I mean that in the most positive way :). Really.

  24. “Rich” to me is being able to take multiple international vacations throughout my life, not just one. I was a history and art history major in college, so being able to see the places and art that I spent so much time studying, without putting it all on a credit card, is amazing to me.

    1. Travelling is a priority for me, so I budget for it. No cable, no eating out, I use my credit card for everything (FF miles), and I stay at youth hostels. When I get to wherever I’m going, I eat from grocery stores or street stalls. Otherwise I couldn’t afford it either.

    2. Traveling is something you have to prioritize, just like anything else. Many people also think that traveling within the United States is cheaper than going abroad, when that’s simply not the case much of the time. You can find amazing deals abroad, and if you budget properly and use rewards cards that allow you to get FF miles and hotel stays, a yearly vacation is very doable.

  25. I know exactly what Kat means (I think!)… while I have absolutely NO intention of “marrying for money” I DO have hopes of marrying someone who can help support the lifestyle that I grew up with/hope to have. Since I intend to work in public interest law, I will never be able to afford that lifestyle on my own.

    1. I posed a similar question above, but what would the reaction (yours and others’) be to a man who said that he had hopes of marrying someone who could support the lifestyle that he hoped for, because wished to work in a field where he would not earn much money?

      It seems to sound a lot weirder and less socially acceptable that way.

      1. I agree it is less socially acceptable, the closest I hear men discuss is a wife that can support herself. However, I know numerous couples where she makes more than he does.

        1. On the other hand, I’ve definitely heard men say they are uncomfortable with dating a woman who makes more money than them. I’ve also heard men say that they don’t want to have to “rely” on their wife’s salary or stat that “her money is her money” and my money is our money.

          It would be pretty outrageous for a woman to say she was uncomfortable being with a man who made more than her because it is so rare for men to make less than women of the same career status. Can you imagine a woman saying that “his money is his, and mine is ours”?

          Until women and men are equal in the work force and societally, women’s jobs aren’t the low paying ones, this difference isn’t really unreasonable.

      2. My partner says this. It worries me greatly because he actually makes a lot more money than I do right now, but he always says that because he’s public sector and I’m private sector, his income will max out at some point and mine won’t. But I don’t ever see myself wanting the kind of job that makes hundreds of thousands, or being able to get it! I won’t qualify (as an accountant) until I’m 29.

    2. If you want that lifestyle, why wouldn’t you choose a line of work to support it? I can’t imagine both expecting a given lifestyle, and choosing a line of work that I *knew* wouldn’t support it.

      I don’t get this at all.

      1. Agree, what happened to choices and consequences? If you make a choice to pursue a certain career, you need to be prepared to live with the consequences that most people in that profession only make x dollars.

        1. Third this one. Why would you think you are entitled to a certain lifestyle but shouldn’t have to work for it?

          1. I don’t think it’s necessarily that.

            I married my husband when we were both fresh out of college and he had no idea what he wanted to do for a living. He did have a bachelor’s and a master’s degree, and he was motivated to work. So I didn’t worry too much. I also had a degree, and a lot of career ambitions, and figured it would work out, one way or the other. We talked about it a lot, and figured for some time that I would be the higher earner in the family (although it didn’t work out that way).

            Now, let’s say my husband had been a completely different guy. And aftergraduating with no clear career goals, he decided he wanted to “find himself” and he parked his ass on the couch. Or he just decided to work some minimum-wage job and didn’t try to start a career, because hey, I had a good job so I could carry the family. That, I would have had a problem with. I didn’t have a minimum income requirement for my husband when I got married but I did want him to have career aspirations and want to get to at least a middle-class standard of living. I expected him to work, maybe not as hard as I did, but to be motivated and strive for something better than what we had. I didn’t care whether my husband wanted to be a plumber, a desk jockey, CEO of a company, or what. I did want him to have a certain level of drive and be able to help me push us towards a certain standard of living.

            Let’s face it. Are there really women out there who would be OK if their spouse wanted to sit on his ass and do nothing, as long as she was making the $135,000 a year she felt like she wanted as a household income? I find that hard to believe. I would be incredibly resentful if I was working my ass off and my husband did nothing, no matter how much money I was making.

            Now, I am not talking about stay-at-home dads – because staying home with kids is work, and I did it for a time, so I know. And I totally think it’s fine if a couple decides the dad should stay home, because the wife makes more money, etc. etc. And I am not sure why anyone would have a problem with a guy saying that he wants a wife that would make a certain amount of money. However, my biggest piece of advice to newly-engaged couples is to devote some serious time to discussing the idea that once kids come along, someone might want to stay home. Sometimes people have deep-seated feelings about daycare or nannies that don’t emerge until the kid is there. Sometimes someone falls in love with being at home with the baby and doesn’t want to go back. I have seen more marriages nearly fall apart over this issue than infidelity – one spouse thinks the other would never want to stay home, the other spouse wants to stay home and is totally resentful that they are being “forced” to go back to work. As much as people say “I would never stay home, daycare is fine, I can’t afford not to work, etc.” once the baby arrives, all kinds of perspectives and priorities can change.

            So, I am not sure what’s so wrong with saying “I want a partner that is motivated to get us to the type of lifestyle I want to live.” I don’t think there are a whole lot of us that want to do WORSE than our parents did, yes? Or wants to carry the whole weight of the household on our backs? I don’t know a lot of guys who would say “oh, sure!” to either of those things, and I think it’s fine – and very common – for men to expect their wives will work most of their lives, with a possible exception for when children are small. Does anyone know a marriage where the wife doesn’t work even if they don’t have kids, or the kids are grown? Because I don’t know any marriages like that, at all – even among my parents’ elderly friends.

          2. To Not Entitled: No one has said anything about guys who sit on their rears and do nothing. Legally Fabulous is talking about “marrying up” so that she can maintain the lifestyle to which she is accustomed/that she grew up with:

            …”while I have absolutely NO intention of “marrying for money” I DO have hopes of marrying someone who can help support the lifestyle that I grew up with/hope to have. Since I intend to work in public interest law, I will never be able to afford that lifestyle on my own.”…

            Presumably she won’t consider marrying someone who e.g. works in public interest law (as she intends to), because this would not enable her to afford the lifestyle she grew up with/hopes to have.

            Therefore, contrary to her assertion, she very much intends to marry for money.

  26. Anon was right – interesting article in the NYTimes re how after $75K a year, money doesn’t buy happiness. But – this is for a normal family – me, I have so much law school debt that I could barely afford to pay off loans with $75K.

    Also a timely topic for this piece I just saw at sweet hot justice: http://www.sweethotjustice.com/2010/09/23/poor-you/

  27. I know at least some people would say I’m rich because my husband and I make about $300K per year before taxes, but I certainly don’t feel rich. We live in an expensive city and can’t afford to buy even a condo in a decent area because I’m just out of law school and we haven’t built up our savings enough for a down payment yet. We have car payments because when we moved from NYC, neither of us had a car. We have a baby, so $1700 /month out the door to childcare expenses.
    I’m sure there are things we could cut out if we absolutely had to, but there is very little room in our budget for fun money after necessary bills are paid and money goes into savings/investments.
    It feels like we’re being punished twice for student loan debt; we have to make a lot of money to pay them off (and simultaneously survive), which pushes us into the highest tax bracket, but then we don’t qualify for the deduction on student loan interest because we “make too much money.”
    Personally, I won’t feel rich until we have no or very little debt, a funded retirement and college fund for each kid, AND THEN money to spend freely. But as long as I’m still carefully budgeting and worrying about money on some level, I’ll consider myself middle class. It’s just that middle class today is tied more to net worth or security than to income.

  28. I was a young, single mother who worked very hard to put myself through college and law school. I was poor then.

    Now I am a lawyer, married, with another baby, and while I don’t make a ton of money, I make enough to pay all the bills, I never have to worry about buying enough food at the grocery store, and we can do fun on the weekend and buy the kids whatever they need and much of what they want. Our cars are old, but paid off, and I can’t always buy the new outfit I want, but things are so, so much better now.

    I will really feel “rich” when I can afford to take a vacation somewhere far away every year.

    1. This is not directed at the poster, because it sounds like she has many expenses, but I don’t understand the far-away vacation fear. It’s not that expensive to go on vacation! My husband and I travel internationally at least once a year. The bulk of our money is spent on plane tickets–$1,000 each–and then we stay in decent but not fancy hotels and spend more or less what we do at home on food and entertainment. For $4,000, a couple can go on a great foreign vacation. We have even sublet our apartment and completely paid for our plane tickets. Maybe I am saving less and putting less in my 401K than everyone else. I do not have a nice car or iPhone or fancy TV. But I just don’t see why it is so hard to travel.

      1. On a good year, our vacation fund (for just the two of us) maxes out at $1k. On a bad year, it’s more like enough for a weekend camping trip. 4K means the 5-year anniversary trip we’ve been saving years for. This is on a combined salary of 50k, with some student loans and a husband who is still in school. Growing up, we never took vacations that didn’t involve staying with family or camping (truly camping, not in cabins). Having that much money for vacations is a concept that many of us can’t imagine.

    2. This is not directed at the poster, because it sounds like she has many expenses, but I don’t understand the far-away vacation fear. It’s not that expensive to go on vacation! My husband and I travel internationally at least once a year. The bulk of our money is spent on plane tickets–$1,000 each–and then we stay in decent but not fancy hotels and spend more or less what we do at home on food and entertainment. For $4,000, a couple can go on a great foreign vacation. We have even sublet our apartment and completely paid for our plane tickets. Maybe I am saving less and putting less in my 401K than everyone else. I do not have a nice car or iPhone or fancy TV. But I just don’t see why it is so hard to travel.

    3. This is not directed at the poster, because it sounds like she has many expenses, but I don’t understand the far-away vacation fear. It’s not that expensive to go on vacation! My husband and I travel internationally at least once a year. The bulk of our money is spent on plane tickets–$1,000 each–and then we stay in decent but not fancy hotels and spend more or less what we do at home on food and entertainment. For $4,000, a couple can go on a great foreign vacation. We have even sublet our apartment and completely paid for our plane tickets. Maybe I am saving less and putting less in my 401K than everyone else. I do not have a nice car or iPhone or fancy TV. But I just don’t see why it its so hard to travel.

      1. Your post suggests that for you, a $4,000 vacation is quite affordable. I am an attorney at a big firm and make a very good salary, but with two children and expenses for a fulltime nanny and a mortgage on a house in the city, there is no way we could afford a $4,000 vacation anywhere. This was the first year in over six years that we took a vacation that wasn’t just visiting the in-laws, and it was roadtrip. So it’s all relative, and each person’s situation depends so much on their personal set of expenses, as well as their income.

        1. Yeah. $4,000 for a vacation is out of our reach at this point as well. We have about $2,000 a year for vacations – in a good year. We road-trip it a lot too. We didn’t fully understand before we had a kid what would happen, but adding a child to the family has made most long plane trips financially out of our reach, as he is now too old to be a lap child. For us, two plane tickets were usually doable, but three is more of a stretch – usually because it gives us that much less money to spend at the destination. Vacationing with kids is also more expensive because they need stimulation and activity, which generally means money – our son gets bored and doesn’t really dig the “sit on the beach for five days” vacation.

  29. “Rich” to me is a monetary idea, but not one about buying stuff. I like nice clothes, I like to drive a nice car (seven years old, but nice) , I like living in a nice house in a nice neighborhood – don’t get me wrong. And believe me, it hasn’t always been like that. I can cook rice about 200 different ways! But in the end, the clothes, the car, the house – it’s all “stuff”. These days, even the house is likely to be “stuff”- it’s where you live, not a wealth-increasing asset.
    To me, there is a huge difference between having assets, including and especially liquid or somewhat liquid ones, and just having some big cash flow. As in, Cash Flows In, Cash Flows Out. Do that, and you’ll never be “rich”, no matter how much money you make. I’m not rich. In my chose field of law, I’ll never be rich. Having learned to pinch the pennies where I can in order to build assets, and yes, even to do some “stuff” splurging from time to time, I am more comfortable on a public service salary than many would believe possible.

  30. I really love seeing all the great answers here.
    As for myself, I grew up in a single parent working class family. My Mom worked two jobs just to feed us and I am forever grateful to her for all her hard work. She pushed my sister and me to go to college and take every opportunity we could. Now I am able to provide for my family in a way that my mother would never imagine and if she could see me now she would be beyond proud. I consider myself comfortable; some of my oldest friends say “rich.” I never ever want to forget where I came from and how I got here, hard work.

    1. I actually find myself furious with the answers here. If people with 300k think of themselves as comfortable instead of rich, I suggest spending time volunteering with those who are truly poor, to get a better idea of what comfortable is, and to understand that they are rich and on the way to wealthy.

    2. I think there is a difference between being “poor” (lack of economic opportunities AND cash) and being “broke” (little cash, low net worth, but good long-term prospects).

  31. I graduated law school last year and have been in practice for myself for around 10 months- I pay myself occasionally, but most of my earnings stay in my operating account to cover malpractice insurance, CLEs, and other overhead expenses. Essentially, I give myself a couple hundred dollars as a “paycheck” every few months, or when we have some urgent need (like new brakes for my car). Otherwise, we survive on my husband’s $38k and my father’s retirement income I received from the state now that he has passed (roughly 15,500 a year). We pay our mortgage, student loans, credit cards (which got relatively high during a period of unemployment while I was in law school) and utilities and wind up with about $100 at the end of the month. Both of our cars are paid off.

    We are poor- but we are building wealth slowly (and paying down debt as rapidly as possible- our minimum payment on the credit card is around $150 a month, but we pay $400 every two weeks on pay days). Plus, our home was the cheapest one in a relatively in demand neighborhood- both our next door neighbors and the folks across the street have sold for $95k MORE than we paid for ours, which I know is rare in this economy. I am lucky to have a husband who is employed sufficiently (and willing to make sacrifices) for me to take a stab at this whole solo practice thing. It is slow going, but it definitely makes me happy. Plus, anytime we have extra cash it goes to fund his dream of opening a fencing school, and we are near enough to our alma mater that he coaches the fencing club there two nights a week. We might be broke, but we are rich in love and potential!

      1. Having so little income that she doesn’t pay herself isn’t poor? Not sure where you’re from but in most of the US, a household living on $38K is not middle class.

        1. Admittedly I was angry at many of the posters when I wrote that, but she has well over 53k a year, and she chose to live in an in demand neighborhood. I think if you ever choose to live in an in demand neighborhood, you are not poor. I wish more people here would look down and see what the rest of the country lives like. Poor for a lawyer is not poor. My family lived in a suburb on 40k and were not poor, we never needed food stamps or worried about losing the roof over our head. We never went on a vacation other than New Hampshire, but those were great vacations for us. Its insulting to me to hear people throw around that they are “poor” when there are people who are terrified they won’t be able to feed their children next month, and people saying they are “not rich” when they are making more money than some families can dream of. I understand they feel not rich because they have a lot of expenses, such as their children’s school, cars, mortgages, clothes, law school debt, etc. These are all valid expenses and ones I pay as well, and worry about even with a similar income. But I would never dream of classifying myself as not rich. I made choices to go to law school, to acquire debt, to purchase and spend my money on certain things. The ability to make those choices, and to choose to run your own practice and to choose to save for a fencing school or choose a nice neighborhood or to save for anything takes you out of the poor category. Some people categorize wealth as the ability to have unlimited choices, well being poor is the absence of choices, and it upsets me to hear people making choices for their fulfillment (which I admire very much) call themselves poor. Broke for the time being maybe, sure. Short on income, sure. Not the same thing as poor

          1. Just as there are levels of “rich,” there are levels of “poor.” To me, someone who fears they will not have sufficient money in the bank to feed their kids decent meals is REALLY poor. To someone in a 3rd world country, the ability to adequately feed your kids most of the time (but not always) may make that person pretty well off and certainly not really poor. And some of it is how you view yourself, as well. If the OP views herself as poor, I am not going to disagree with her – paying student loans on 53K per year (before taxes!) is not easy, at least not in any part of the country where I’ve ever lived.

        2. Actually in much of the US, I think it might be considered middle class. The OP also has another 15k or so that’s coming in, so that bumps it up some too.

  32. I consider myself to be temporarily poor. I’ve been supporting myself and my husband on my $23k a year salary for over a year now. We’re both in school, and up until this semester we’ve paid for my classes out of pocket. We live in a low cost of living area, and our first year and a half of marriage, we had a combined income of around $60-65k… it was great. It was very comfortable. We paid off all our undergraduate student loan debt (not a whole lot, thankfully), and paid cash for everything we wanted. We had also started saving up a down payment for a house when he decided to quit his job and go back to school. Now I’m in school to become an accountant while working full time, and he’s working on an engineering degree. I’m expecting our income to increase dramatically in the next year or two. We’ve managed to live on my income, which is uncomfortable, but doable, without using up that much of our nest egg.

    We were very comfortable living on 60k a year, but I’d prefer something higher, maybe around $100k. This is mostly because I like planning my financial life way in advance and would really like to pay the mortgage off on my (hypothetical future) house as quickly as possible, while amassing savings, investments, and retirement savings. In a way, I am partially motivated by money– my husband is 100% passionate about electrical engineering in a way that I am not about accounting. I enjoy doing what I’ve done so far, and the class work is pleasant (and dare I say fun?), but my chosen career path is partially about having a stable job that pays decently enough. However, since my income sights are pretty low (compared to what some people can make in accounting), I’ll be able to pick a job at a firm that offers me a decent work/life balance. … So I think with our frugal habits, my husband and I will soon both be able to feel rich, and be rich. Fingers crossed, anyway.

  33. I make 70,000 a year. I have a ton of law school debt but I stick to a strict budget- I take public transit, prefer cooking in to eating out, don’t have cable, always take my lunch to work, etc. I used to be in a gov’t law job at $41k a year, and I haven’t changed my spending habits now that I make a little more, since I want to pay my loans totally off before having kids. My IBR loan amount is $631, but I pay around $2000 a month. I’m on track to pay off my loans by 35 (3.5 years). I max out my 401K each year and have $20,000 in savings. By the standards of many people on this board, I’m nowhere near to ‘rich,’ but I love my job, and get immense happiness from paying the bills each month as well as moving closer towards my goal of repaying my loans. My life is very fulfilling – great relationship, good friends, etc. And, after years of making less than 20 grand – and working with people who are *actually* poor in developing countries – I couldn’t imagine arguing that I can barely make ends meet. I can pay for everything I need.

    1. This is pretty incredible to me since we make about the same and I am unable to pay more than $1000/mo on my loans and have much less savings but am similarly austere about spending. Can I ask what part of the country you live in?

      1. I live in a major midwest city, but I lived on similar amounts in major west coast cities, including Seattle. $900 a month covers the absolute basics: $525 for a tiny studio, all utilities included but electric at around $15 and internet for $40, firm pays for phone and health insurance (a biggie); remaining $320 covers monthly groceries and bus fare – I otherwise walk or bike. 3800 a month minus 900 minus 2000 in loans still leaves around 900 for misc. expenses … $60 per paycheck for spending money (haircuts, etc), and the rest goes to savings.

        I built up several months of expenses in savings before I began dedicating it all to loans, which is where the $20,000 comes from. All gifts / bonuses go towards loans too. I use my credit card for everything and use the points for gift cards to buy suits with. It’s a tight budget, but I’m certainly not starving.

    2. This doesn’t sound that out-of-line to me. I make $80,000 per year, my monthly student loan payment is $1,300, and I have $50,000 in savings (non-retirement). I am very proud of what I have accomplished savings-wise, but I also live on a very strict budget like lk–I take public transportation (I don’t own a car), I often eat in instead of eating out, I turn off the A/C while I am gone during the day, I pride myself on being a bargain hunter, etc. And, fwiw, I live in a major East Coast city.

      Unlike lk, I have focused my savings on a down payment instead of putting additional money toward the student loans, as my significant other and I would like to purchase a house within the next year. As soon as I reach my down payment goal and can be sure I still have an emergency fund, I will definitely be focusing on paying down the student loans, though. Regardless of how frugal I am, I don’t think I’ll ever feel “rich” until the student loan debt is totally gone. Sigh.

  34. I have a very different point of view from most people on this thread. The theme has been I’ve made it and I do/don’t consider myself rich. Well I am just starting out. I graduated law school with $160k in debt during a horrible time in the job market. The job I found, after a significant period of searching, pays on par with my first job out of college, which I quit because the money was not enough (and I hated it). So to take the opposite approach, I consider myself poor. I am fortunate to have a significant other with a better job who fronts a lot of the bills, because I cannot afford to. I know in many ways I am still fortunate, that I have a roof over my head, a car that still runs (barely), clothes on my back, and food in my pantry. What I do not have is independence. I am reliant on someone else for my living, which gives me a feeling of being poor. Having to fill out economic hardship forms is actually very embarrassing and big hit to the ego. I’ve stayed up more than one night worrying about money.
    So what I consider as being rich will be when I fully can support myself. No parents, no boyfriends, no credit card balances. Being rich would be being free. I really dislike my current position, but I’ve yet to find another job. I hate being trapped somewhere I don’t wish to be.
    The short answer is that being rich to me is being free. Once I am independent and can make choices freely then I will be rich.

    1. This.

      I’m in a slightly different situation but totally empathize. I’m just out of grad school, making $35k in a sucky short-term job. I’m debt-free, but due to work authorization issues on my visa, I’ve never earned any “real money” until now. I’m young enough that my main source of support is my parents and not a significant other, and they are giving me a significant amount each month. They feel strongly that I should have “nice” things, and are willing to fund them for me. I’m torn about it, but I take the money. On the one hand, this is great — I have an apartment I couldn’t otherwise afford, and a more livable income than I otherwise would. On the other — I am not independent. I am very conscious of this, and I hate it. I’m economizing, can pay my credit card from my paycheck each month, and starting to establish some savings ($10k, but it’s a start).

      So I’m pretty broke, but fortunate to have supportive parents (and appreciative of them despite my concerns). I’m frankly not thinking about becoming “rich” yet, but my goal is to find a different job soon where I can be completely financially independent. That’s my first major milestone to hit.Building up significant savings will be the next step.

      1. I’m in a pretty similar position to you. I’m also dating someone who makes a lot of money (biglaw). So I feel doubly dependent/constricted, because I’m dating someone who expects me to be willing to go out for $20 dinners and buy $15 drinks, and I’m being offered money by parents who think I should live like they do (they are both making about $200,000 per year). There’s pressure to make money, pressure to spend money, and it takes a lot of effort to convince them that I need to live within my personal, hard-earned, limited means. It’s especially hard for my boyfriend because it seriously impacts the decisions we make about how to socialize with other people. And I’m not sure whether I should go back to school and take out a huge loan in the hope of “catching up” or whether I should just accept that I will be earning a low salary relative to my family and most of my friends. I’m babysitting and tutoring to supplement the income I’m making with my professional degree, and while I love the kids, I find the situation really depressing.

  35. Thomas Stanley has a few books on the idea of “rich”. He’s the author of “The Millionaire Next Door” as well as “Stop Acting Rich and Start Living Like a Real Millionaire”. He makes very interesting points about the way in which people achieved financial independence and became “rich”. Often times the people with the highest salaries do not have high net worth due to high consumption.

  36. What a very very interesting thread.

    From a slightly different perspective. I’m in Big Law in London. The same principles certainly apply here – law school is expensive, living in London is expensive and I have a lot of debt and very little disposable income.

    To put a spoke in the wheels, becoming a lawyer in the UK is quite different to the US. After law school you are looking at a two-year ‘training contract’ which is working at a firm at similar skill levels to a first year associate in the US – maybe even a bit different as law school here is very practical rather than academic – but not being an attorney in your own right in that you can’t technically give advice, you need to be supervised etc. and you work in (usually) four different departments in your firm. However, once you get to the end of your two years, you come to qualify and the world is your oyster. You pick a specialism and you salary goes up. Unfortunately, the training contract is exactly that – a contract. It’s for two years and at the end of it awaits either a job as an associate at your firm, if you’re good (and lucky) or, more likely in the current economy, directions to the nearest bread line.

    I’m nearing the end of my two years and I am terrified. I currently make about $63k. If I get a job at my firm when I qualify, I’ll make about $90k. I owe about $70k in student loans (yes, I know that isn’t very much in comparison to the US!). I am paying that off right now, but carefully, as I am trying to put a little aside every day for a rainy day. That means that I can’t afford to go shopping, I can barely afford to go out, I certainly cannot afford holidays. Right now, I have $13 in my bank account.

    This is pretty depressing as there is no guarantee of a job when I finish my two years. I’m nearly thirty and with the debt I have, I have no hope of buying a house or any other fixed asset or investment for a good few years. I have no pension and my savings are barely enough to pay my rent and bills for much more than a month or two if I end up unemployed.

    I can’t remember what the point of this was now, (other than to get myself really depressed, apparently) but certainly it is all relative. Other trainee lawyers at my firm who live at home and have no debt have pretty much saved up a down-payment for a house in the two years we have been working.

    Whoever said law was lucrative was probably from a family that could afford to subside his or her entire academic career!

  37. Although it doesn’t specifically address the definition of rich, I’ve always felt that John D. Rockefeller’s answer to the question “how much money is enough?” is incredibly telling. His response: “Just a little bit more.”

    1. along these lines, just heard this quote: “rich is the man who makes $1 more than his wife’s sister’s husband.’

  38. Great post and great discussion! I’ll echo a lot of the folks above – for me, being “rich” is about having a high net worth – high enough that what I do with my time becomes entirely my choice. Basically, until I can say with certainty that I can stop working and live comfortably (good food, occassional visits to family and friends, college education for the kids, and a modest apartment) on what is “in the bank,” I will not consider myself “rich.”

    As a complete aside, I don’t think the point of the $250,000 threshold is really about taxing the “rich.” I think it’s about taxing the folks that can actually afford it without it causing them real hardship – and when I say hardship, I mean missing a meal, not canceling a cleaning service. No offense to anyone with a cleaning service (I’ve got one myself), but it’s not the same thing. Whether this attitude is “fair” or not, I’ll leave for another day.

    1. Agreed on all points. And I wish commenters here wouldn’t (1) *accuse* people of being rich and (2) distinguish between comfortable and wealthy. It’s nice to be comfortable, certainly better than being poor. But I still think there’s a difference between earning, say, $100-$200K/year (and having a family) and earning $500K. I guess my distinction is, if you’re comfortable, you probably can’t quit your job to live your dream or fulfill your passion or whatever; if you’re wealthy, you can. (This is assuming you earn a lot of money and also save enough of it in a fairly liquid form.)

  39. I thought I was rich when my kids entered public school and I could stop paying for day care. Then I realized I’m far behind on saving for college, and I don’t want them to end up with horrendous amounts of debt. So now I feel poor again.

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