Americans Set "Rich" Threshold at $150,000 in Annual Income

PRINCETON, NJ -- Americans say they would need to earn a median of $150,000 a year to consider themselves rich. However, 30% say less than $100,000 would be enough, including 18% who would consider themselves rich if they made less than $60,000 a year. On the other hand, 15% say they would need to earn at least $1 million per year before thinking of themselves as rich.

The results are based on a Nov. 28-Dec. 1 Gallup poll. The question of who is "rich" in the United States has been frequently discussed during the past few years as the nation's policymakers debate income-tax and deficit-reduction policies. Additionally, the Occupy Wall Street protests have focused their attention on the wealthiest 1% of Americans. The poll results suggest Americans would need quite a bit less than what the wealthiest 1% of Americans earn to consider themselves rich.

Americans' perceptions of the annual income they need to be rich are a bit higher than in 2003, when Gallup last asked the question. Then, $120,000 a year was the median amount Americans said they would need to make in order to think of themselves as rich.

According to the U.S. Census Bureau, the median annual household income in the United States is roughly $50,000 per year. The Gallup poll finds those below that level typically saying they would need to earn $100,000 or more in annual income to be rich. Those at or above that level typically report they would need to earn $200,000 a year to be rich, which expands to $250,000 among those well above the U.S. median income ($75,000 or more in annual household income).

The poll also finds higher estimates of the annual income needed to be rich among men than among women; estimates are also higher for younger vs. older Americans, and college graduates vs. college nongraduates. The typical parent of minor children believes he or she would need to make more money to be rich than does the typical American without minor children. Additionally, urban and suburban residents believe they would need more to be rich than do those residing in towns or rural areas.

Americans Believe $1 Million Net Worth Would Make Them Rich

A separate question in the poll asked Americans how much net worth, or savings in cash, stocks, real estate, and other investments, they would need to consider themselves rich. The median figure Americans give is $1 million, the same as in Gallup's 2003 poll asking the same question.

Currently, 26% of Americans say they would need in excess of $1 million in savings in order to consider themselves rich, including 14% who say $5 million or more. At the other end of the spectrum, 13% would consider themselves rich with less than $100,000 in savings.

Estimates of the amount of savings a person needs to be rich are generally similar by subgroup, though college graduates report a median of $1 million and college nongraduates of $500,000.

Implications

Americans generally would consider themselves rich if they made $150,000 per year or had $1 million in net worth. That seems to differ a bit from the federal government's definition of rich. For example, the federal government's top tax bracket of 35% begins with individuals and married couples earning $379,000 or more annually. Also, when Congress debated extending the 2001-2003 federal income tax cuts, the debate centered around whether to extend those for single Americans earning $200,000 and couples earning $250,000 or more per year.

The question of the point at which someone becomes rich certainly has policy implications in the United States. Gallup finds Americans now about evenly divided on whether the rich, broadly speaking, should be heavily taxed. At the same time, Americans usually show widespread support for higher taxes on upper-income Americans to pay for specific programs such as those designed to create jobs, reduce the deficit, and pay for the healthcare legislation.