How Being ‘Rich’ Varies by Generation

Five people at different ages standing agains a wall seperately.
Todor Tsvetkov / Getty Images

Everyone wants to be rich, but what does it take to earn that title when Jeff Bezos and Elon Musk alone have a combined net worth close to a half-trillion dollars? The truth is, a lot of it has to do with when you were born. Different generations have different ideas on what it takes to be rich — and even on the concept of wealth, in general.

Read More: Gen Z Begins to Emerge from Pandemic Wiser About Money — Here’s What They’re LearningHelpful: 6 Ways To Start Building Generational Wealth for Your Family

Are Millionaires Still Automatically Rich?

For generations, landing that second comma in your net worth meant you had made it — but do a million bucks still make you rich? Nicole Miller, owner of the site Finance + Freedom, thinks not.

“While many people would agree that getting to a million dollars would be considered wealthy and living comfortably, recently, many who have passed the million-dollar mark have realized that a million isn’t what it once was,” Miller said. “Today, $5 million is the moment people feel they don’t have to always worry about money anymore.”

Find: Millennials and Gen Z Want To Retire by 60 — One Expert Points Out Major Obstacles to Their Plans

Margaret J. King, Ph.D., and director of the Center for Cultural Studies and Analysis, believes that the million-dollar benchmark comes from the Greatest Generation — and that the parents of the baby boomers got in their own way to reaching it simply by manufacturing so many hungry mouths.

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“It was their own creation by having four, five, and six children to a family between 1946 and 1964,” King said. “At the time, millionaire was the goal, and it seemed distant. Now $2 million is the minimum to guarantee a comfortable retirement for any generation.”

See: Surprising Ways Gen Z and Millennials Are Worlds Apart Financially

It’s a Bit More Nuanced Than a Single Dollar Figure

Lana Hinds, an accredited financial counselor, is hesitant to name a specific number and instead cites a range based on a slew of variables.

“The answer depends on the definition of rich, one’s location, cost of living, standard of living, and a host of other factors,” Hinds said. “Today, it would take $1.5 million on the low end of the spectrum and at least $3.5 million on the higher end to be rich.”

There are so many variables, in fact, that the term “rich” itself varies by generation.

“According to Schwab’s 2021 Modern Wealth Survey, to be considered wealthy among millennials, one needs to have a net worth of $1.4 million,” said Michelle Ebbin, founder of the clothing brand JettProof. “For Gen Xers, it’s $1.9 million and for the baby boomers, it’s $2.5 million.”

Find Out: What Gen Z Can Learn From Millennials’ Money Mistakes

Carter Seuthe, CEO of Credit Summit, thinks it has more to do with income than net worth. Six-figures, he points out, used to mean you had made it. Not anymore.

“Households making $100,000 a year struggle in many major cities,” Seuthe said. “The perception now is closer to $400,000 a year being truly rich, with a retirement account in the millions.”

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In the end, however, “rich” has always been and will always be a relative term.

“There is no absolute definition of wealth,” King said. “It is relative to family, community, profession, and expectations.”

See: Gen Xers Share Their Biggest Money Regrets for Gen Z To Learn From

Philosophically, the Concept of Wealth Has Changed Over the Generations

Many experts feel that examining assets, income and net worth is a one-dimensional approach to determining wealth.

“Wealth is not limited to dollars and cents,” Hinds said. “Millennials and Gen Y value connection, life experiences, and happiness. This is evident in the demand for work/life balance, prioritizing purpose and passion, and pushing back on traditional norms. Previous generations viewed homeownership as the holy grail of the American Dream and pursued it as early as possible. Millennials are taking the scenic route to homeownership.”

Find: Collaborative Investing and How It Could Improve Gen Z’s Wealth

The concept of being “rich” has never stopped evolving.

“Baby boomers have a ‘traditional view of wealth,'” said Richelle C. Delia, Ph.D. and co-founder of Housing Joint Venture. “Many of them are still shaking off the career norms they grew up with of being able to have a long, stable career at a single company. They do tend to value tangible assets like land, real estate, and gold, and believe in the overall longevity of government-backed assets and fiat currency.”

They passed those ideas onto their children in Gen X.

“I’ve come from a generation where wealth is measured by numbers and assets,” said Gen Xer Jay Whitacre, chief scientist and founder of Aquion Energy. “Unlike today where ‘wealth’ has become a much more philosophical term that includes contentment in life, emotional investments, etc.”

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Lessons: What Millennials Can Learn From Gen X’s Money Mistakes

The New School Philosophy on Wealth Began With Gen X

The transition from boomer to Gen X is where the philosophical divide seems to be starkest.

“Gen Xers were the first generation where playing by the rules did not necessarily lead to the desired outcome,” Delia said. “Many of them were coming of age during the Savings and Loan Crisis, the Gulf War, and the dot-com bust, so they place value on being able to provide for themselves. They may have lost property in the Great Recession and tend to be more hesitant to enter into fixed assets like land and real estate because they know firsthand the dangers of not being properly prepared.”

Their younger counterparts have one foot in both the old and new schools of thought.

“Millennials are experiencing a hybrid of optimistic youth with the pragmatic realities of adulthood,” Delia said. “This generation birthed social media giants like Facebook but also witnessed the devastation of the Great Recession and unprecedented student loans.”

For the youngest Americans, however, the old rules are ancient history.

“People in Gen Z are now coming of age and value social assets almost more than traditional asset classes,” Delia said. “They see social influence and having an audience that can be monetized as equally as valuable as dollars and income-producing property. Because they have seen so many people rise from obscurity to the public eye, Gen Z can sometimes feel that wealth is easy to gain as long as they have a smartphone.”

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See: Why Gen Xers Are Feeling the ‘Financial Squeeze’ — and What To Do About It

So, Is It Easier or Harder To Get Rich Today?

As always, older people tend to think that today’s youth have it easy — and in terms of getting rich, they might just be right.

“It’s actually easier to become rich today than in previous generations,” said Marcos Martinez, owner of the black gay lifestyle blog Men Who Brunch. “In this Information Age, people have more access to information about financial literacy and wealth accumulation. There are fewer job barriers for minorities and disadvantaged groups like those with special needs and the elderly.”

Read: Baby Boomers, Gen X or Millennials — Who Really Had It Worst Financially?

Jake Hill, CEO of DebtHammer, thinks just the opposite — that it’s much harder for today’s young people to acquire real wealth.

“If you talk to Gen Z or Millennials, they will tell you that buying a home right now either makes a person rich or on the way to becoming rich,” Hill said. “But, for baby boomers, buying a home around age 20 was completely normal and pretty accessible.”

One thing is certain — a mountain of riches is about to change generational hands.

“The great wealth transfer is now upon us,” said Stephanie Brobbey, founder of wealth advisory service the Good Ancestor Movement. “Anywhere between $59 trillion and $70 trillion will move from baby boomers to the next generation over the coming 10 to 20 years. How they treat that wealth and what purpose it serves will define the future of our society and planet alike.”

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