Being a millionaire may not have the same hiding place as it once did. So argues real estate magnate Grant Cardone in a recent video on his YouTube channel in which he details five steps to becoming a millionaire.
“Everybody’s like, ‘Oh my god, the iconic millionaire, you’re rich,'” he said. “You’re not rich…you’re worried.”
In the video, Cardone stands in a dark office and shouts a lot in an effort to show that being a single-digit millionaire won’t get you very far these days (which, if you take his word for it, says some long on the rest of us considering the typical net worth of a family in the United States is $121,700). He broke down some math to validate his point: If a 30-something with $1 million and zero income spent $4,000 a month, which equals $48,000 a year, he’d be broke by the time he hit 51.
“Millionaires are basically middle-class people who worry about money,” Cardone said.
The self-made millionaire, CEO of real estate investment firm Cardone Capital, author of several business books and a Scientologist, is known for his hot shots – in the past he said he would embarrassed if he only made $400,000 a year. And his polarizing comments don’t stop at financial advice – he recently came under fire for tweets to his almost 1 million followers regarding anti-trans laws. Being controversial is part of his brand: As he recently tweeted, “You don’t have to like everything I say. The feeling is mutual.”
Many people may not like his take on single-digit millionaires either (Cardone did not respond to The wealth request for comment). After all, earning $1 million doesn’t happen overnight for most people. That’s a hard net worth to achieve when you’re in the real middle class, whether the The Pew Research Center defines such as a single person earning between $30,003 and $90,010 or a family of four earning between $60,000 and $180,000.
Now hypothetical 30-year-old millionaire Cardone is talking about do fall into that middle class bracket if they live on $48,000 for the next 21 years. But the example is highly unlikely: most people don’t strive to retire at that age, unless you’re part of a small subset aiming to join the FIRE movementand those who often rely on passive incomewhich Cardone did not take into account.
A million dollars is pretty out of reach for the average Joe; THE average american household has a median savings of $5,300 (the average, which is skewed by higher incomes, is a bit better at $41,600). Although a person’s net worth also includes assets like real estate and car ownership, these two investments have become less accessible to the middle class in recent years due to a combination of rising inflation, competitive markets and high interest rates.
While the middle class has been able to raise money during the pandemic, their the golden age has since faded away as the economy rebounded and inflation, which had been high for 40 years, took over. In regards to 8 out of 10 middle-class families in the United States say they are eating into their savings to cope with a high cost of living, according to a Primary investigation. While many upper-class households got raises to keep pace with inflation, middle-class families didn’t see the same pay raises—contribute to already shrinking middle class.
Yes, the rich are worried, but that doesn’t make them middle class
Of course, even the rich have I felt a little uncomfortable thanks to inflation and a stormy stock market. Less than half (44%) of all millionaires feel “very comfortable” with their finances (although this is still twice as many as all respondents), according to a survey by Edelman Financial Engines. And 29% of millionaires say they don’t feel rich.
This is likely because today’s economy is having a negative impact on standard financial benchmarks; consider that more than half of Americans who earn more than $100,000 a year feel they live paycheck to paycheck. And $1 million ain’t always enough for comfort retirement.
“While this is still an exceptional level of achievement, it is debatable whether this amount is sustainable as a lifelong source of income, given improved longevity and high inflation” , Michele Lee Fine, Founder and CEO of Cornerstone Wealth Management Advisorysaid The wealth Alicia Adamczyk to retire with $1 million.
But it can still be done with smart budgeting. “A million dollars isn’t what it used to be, but it can still provide a comfortable retirement if done right,” Gates Little, president and CEO of Southern Bank Company, told Adamczyk. . Even if the above Cardone example were applied to a person who retired at full retirement age of 66, it would last until age 87 – perhaps not the full length of retirement for some, but again, this example does not include passive income or social security benefits.
Of course, being a single-digit millionaire means different things in different cities; it probably won’t give as much financial security to someone in high cost cities like New York City Or San Francisco as might be the case in a non-metropolitan area. While Americans think we need a $2.2 million net worth to be wealthy, their financial comfort level – which one might equate to middle class – is $774,000.
But just because the value of a million dollars has depreciated doesn’t mean it isn’t a lot of money, as Cardone suggests. A well-invested $1 million net worth is nothing to sniff at.
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