According to a study, 89% of Americans don’t consider themselves wealthy. Click here to find out what is stopping them!
Although inflation is slowing down and wages are increasing, many Americans still don’t feel financially secure. According to Fidelity Investments’ State of Wealth Mobility study, which surveyed 1,900 adults in August, 89% of Americans do not consider themselves wealthy.
“Only one-tenth of Americans consider themselves wealthy today — despite many having considerable wealth”, said Rich Compson, head of wealth solutions at Fidelity Investments.
71% of respondents said that being wealthy simply means not living paycheck to paycheck. While 57% consider that being wealth means traveling and vacations and 49% being able to own a home.
Among high-net-worth individuals – those with at least $1 million in savings and investable assets (excluding real estate or retirement accounts) – traveling was even more strongly associated with wealth than any other options.
Why Are Americans Unable to Feel Wealthy?
The high cost of housing has made homeownership a distant goal for many. Elevated home prices, rising mortgage rates, and limited inventory have created significant barriers, with affordability having a pressing concern for households.
Although vacations have become more expensive, Americans continue to prioritize travel. Still, high prices have caused some to stay home, while others have adjusted their budgets to accommodate rising costs. Travelers are spending about 10% more on average compared to 2023, according to Deloitte.
On top of that, rising consumer debt is weighing on household finances. A report from Edelman Financial Engines revealed that 44% of Americans see credit card debt as the biggest obstacle to building wealth.
“High interest rate credit card debt, more than other sorts of debt, is a savings killer, because when you have it, you have to feed the beast. You can’t save, you can’t invest. That stands in the way of people building actual wealth and therefore feeling wealthier”, said Jean Chatzky, personal finance expert and CEO of HerMoney.com.
What It Takes to Feel Wealthy
According to Edelman Financial Engines’s report, to feel wealthy, 65% of respondents said they would need $1 million in savings, while 28% said they’d need at least $2 million, and 19% set the bar at $5 million or more.
Experts emphasized that financial security depends more on habits than income. Saving more than you spend, building a diversified portfolio, and consulting a financial advisor can have a greater impact on wealth-building.
“Having confidence in being able to invest strategically is what often separates those who feel they are wealthy from those who don’t. Improved confidence starts with education and planning”, said Fidelity’s Compson.