Millionaires and their worries
July 23, 2012 § Leave a comment
You’re a ‘regular’ income earner. You aren’t particularly rich or poor. Maybe you are middle class or upper middle class. And maybe you think if you had a million dollars, you’d have no worries. Not so, according to a Fidelity survey of millionaires and their worries.
How much is enough? – Retiring at age 65, with potentially thirty years of inflation and health care costs, millionaires used to think that $3 – $4 million would be a good goal and an adequate amount for their savings account. But it turns out that the $3 – $4 million dollar level isn’t enough. They don’t feel wealthy. To ‘feel rich,’ they’d need about $7.5 million. You can understand. The longer you live and the more experience you have in life and it’s calamities, we’ve all seen things go wrong and lives upended by unexpected events. Millionaires feel the same. It seems that even if you have what seems like a lot to some, you always feel more cozy with more money.
How do they invest?– Millionaires are fairly conservative in their investing, according to this survey. A majority of the survey respondents said their investment goal was ‘preservation of capital.’ Preservation of capital means you don’t want to lose what you have. You are not willing to risk, even for the possibility of potential growth, as you are very much interested in avoiding all loss. This is not the usual growth objective of investors saving for retirement.
Charitable giving– Millionaires were increasing their charitable giving, according to this survey. Not by a large amount. But it was up from $36,000 annually to $38,000.
People are people, as you can see from this survey. We think more money than what we have will make us feel rich. We are worried about losing when we have saved some money. And we try to be charitable, even more charitable. Millionaires may be different than us in that the numbers in their accounts are bigger. But, really? Wehave a lot in common.