The Untold Truth About the Millionaire Lifestyle
When you think of a millionaire, what is the first that comes to your mind? Luxury cars, Expensive homes in exclusive areas, Designer clothes, and Vacations that most of us can only dream of. That’s totally understandable, it’s the image that society has fed us about the millionaire lifestyle from an early age through movies in the last century, and social media nowadays.
The unfortunate reality of this image that we’ve been fed is simply to set unhealthy and unrealistic expectations for those that are trying to reach financial freedom. It inflates the image of what financial independence really looks like. And it downplays the amount of work that it takes to actually accomplish it.
Becoming a self-made millionaire requires an incredible amount of dedication, discipline, financial education, and even some luck. But this materialistic image of the average millionaire is really at odds with the lifestyle required to reach the level of wealth that these images portray.
In simple terms, you do not get that rich spending your money on the things that make you look that rich.
So, if the societal image of the average millionaire is wrong and if the supercar driving, world traveler, and all the fancy stuff is not the average millionaire. What does the average millionaire actually look like?
Well, let’s paint a new more accurate picture for you.
millionaire’s Real lifestyle According To Data
According to the Global Wealth Report there are just over 20 million millionaires in the United States. That’s around 8.5% of the U.S population. Just to put that into perspective that’s one in every 12 adults in the U.S.
That’s a lot that’s a lot of millionaires, that’s certainly more than what you guessed? What’s more fascinating is that 80% of them are first-generation millionaires. Which means they didn’t inherit the money.
The average millionaire is 49 years old, and 60% of millionaires live in a home that’s valued at less than $500,000. 15% live in neighborhoods where the average household income is less than $75,000 annually. And their income is only slightly higher than that with the average millionaire household income being just under $78,000.
86% of American millionaires are married, while 65% are still in their first marriage. 66% own a business, only 20% consider themselves retired which means the other 80% still go to work every day.
67% spend less than one hour a day watching television or online videos. 76% exercise at least three days a week. 33% percent of millionaires claim they only purchase used vehicles. With the most popular millionaire rides being Toyota’s and Honda’s, reliability and resale value are noted as the main reason. 90% of millionaires own real estate but that includes their residence.
This profile is a far cry from the Lamborghini and mansion lifestyle that most of us have in our heads. In fact, the profile of the average millionaire doesn’t sound all that different from your average co-worker.
That’s because they’re everyday people just like you, and started their adult lives with very little money but they’ve been smart every step of the way. All it takes is small steps and little wins over a long period of time to get you there.
They spend less than they earn, saving, and investing on average 24% of their bring-home income. They invest in boring dependable investments with the help of a financial advisor.
That’s the real image of financial freedom in America, that is the real millionaire life.
The image that society most often portrays as the millionaire life is really more in line with the Deca-millionaire life. To those who don’t know what a Deca-millionaire person means, that’s someone with a net worth between 10 million and 100 million. That’s a whole different level of wealth. If that’s your goal, it’s going to require a whole lot more than just working your regular job, saving, and investing.
So the big question is:
Do you really need the deca-millionaire lifestyle to be happy?
Purdue Research found that personal well-being and life happiness steadily increase up to an annual income of $75,000. With only marginal improvements in life happiness from $75,000 up to $95 000. With $95k being determined as the ideal income for life satisfaction.
This is interesting, once that threshold of $95,000 is reached they found that life happiness and satisfaction actually go down as income goes up. They theorize that once your basic needs are met up to that $95,000 the stress associated with managing all of the excesses beyond that begins to decrease well-being and happiness. We know that a lot of you people would like to test that theory!
They also found that we’re more satisfied by the perceived trajectory of our life than we are with our actual income. For example, a person that works hard and raises their income from $50,000 annually up to $80,000 annually may feel more satisfied in life than a person that actually has a decrease from $250,000 to $225,000. Even though the latter earns far more than the former.
So it seems that once the necessities are covered, the satisfaction is in the pursuit and the personal growth not in the money.
We would like to suggest what we believe is a better definition of being rich: The ability to live the life you choose without the worry of money. This means you have enough passive income from your investments that you never have to work another day in your life again. (if you don’t want to)
By this definition being rich may not really require all that much money, the more frugal your lifestyle is the easier it would be to consider yourself rich.
For some wealth may mean living in an off-grid cabin and reading books all day, while for others it may be the Lamborghinis and the mansions. Just as our desires in life differ so will our requirements for our lifestyle choices. Define what wealth looks like to you and determine how much money you need to live that lifestyle. Build a plan to get there and then get to work implementing it that’s how simple it is to be rich.
We hope you found some good value in this article.