Why It Matters How You Define Wealth

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In the age of social media where we scroll through endless posts of people flossing in front of luxury homes, fancy cars and private jets, it’s no wonder that the concept of wealth is diverse.

Even if many of those photos are faked in some way, the way people show off wealth is pretty indicative of how they perceive being wealthy.

How Much Money Do You Need to Be Wealthy?

According to Charles Schwab’s 2019 Modern Wealth Survey, which asked 1,000 American adults between age 21 and 75 what personal net worth they would need in order to be wealthy, the average answer was $2.4 million. Yet, to place among the top one percent of earners in the U.S., you need an annual salary of $400,000.

This definition of wealth may resonate with those who think having as much money as possible means you are successful. To many others, wealth is defined by their ability to maintain a livable income, control their own time, keep in good health, and have an abundance of good friends and family, memorable experiences and more.

However you define wealth, ideally it is based on what you value to bring you authentic happiness. As noted entrepreneur Gary Vaynerchuk often says, “Many of us are buying things we don’t even want to impress people we don’t even like.”

Everyone Sees Wealth Differently

Defining happiness is as subjective as defining wealth. But if you can honestly identify what either one means to you, the other will usually follow. Perhaps wealth is more abstract and should be connected to a philosophy, and not tangible items such as money.

Time Is Money, Money Is Time

For example, time is the most precious of all assets, as it is something that you can never get back no matter how much money you have.

However, with wealth comes the ability to buy more of your own time, meaning you can have more control over what you do with your 24 hours each day.

No one wants to grow old and regret the things they wish they had done differently. So, would wealth allow you to live your life to the fullest and make the most of your time? If so, don’t just earn your money. Make sure you’re using that money to live your life the way you want to live it.

Or perhaps you measure wealth through prestige or influence. Some people feel that earning a respected degree, like going on to become a doctor or teacher, brings a meaningful direction to their life. Maybe you believe your legacy is your wealth, and your goal is to have a positive impact on people’s lives, leaving this world a better place when you are no longer here. 

Whether you define wealth in terms of an abundance of money, an abundance of time, an abundance of good actions, or something else, the goal is to form your own personal definition based on what truly will make you happy. Because once you find happiness, you will truly be wealthy.