How do you measure wealth? Financial success to many Americans doesn’t mean living a luxurious lifestyle but living beyond milestones that show they are financially secure and independent. The term ‘middle class’ encompasses a wide range of incomes and lifestyles; according to the Pew Research Center, middle-income households are defined as having two-thirds to double the national median income.
In 2021, that would be $52,000 to $156,000 annually for a three-person household. If you’re wondering if perhaps you’ve crossed the line from middle class to rich, there are clues that go deeper than a flashy purchase—habits of mind, financial habits, and choices that contribute to lifelong wealth.
You Have Multiple Income Streams
The wealthy aren’t reliant on a single job or income. They make extra earnings beyond their primary profession by investing, real estate, side businesses or dividends.
For example, a Nasdaq study found that affluent people have diversified sources of income. Such a financial safety net ensures they become wealthier even in bad times. Invest in something, and start a small side hustle to diversify your portfolio.
You Employ a Financial Advisor
Often wealthy people hire professional wealth managers to manage their sprawling portfolios. This isn’t the routine middle-class planning it is about getting the best out of your investments, minimizing your taxes and making educated financial decisions.
If you can no longer keep your financial assets under control, it might be a good idea to consult an advisor.
You Max Out Retirement Accounts
An average 401(k) balance among Americans ages 45 to 54 is $161,079, according to Vanguard’s 2023 How America Saves report. If you typically max out your 401 (k) or IRA contributions ($22,500 for 2023 and an additional $7,500 if you’re 50 or older), you’re likely growing wealth faster than most.
Generosity Comes Without Financial Stress
Giving generously is one of the liberating benefits of wealth —whether that’s supporting charities, friends in need, or community initiatives without impacting your lifestyle. The wealthy make contributing to disaster relief or local fundraisers seem like an easy habit. According to the 2023 Bank of America Study of Philanthropy, eighty-five percent of affluent households gave to charity in 2022, with the value of their average gifts rising 19% above pre-pandemic levels.
High-End Experiences Are the Norm
The wealthy prefer luxurious experiences – from dining at Michelin-star restaurants to attending exclusive galas to high-end art auctions. Here, what might otherwise be an occasional splurge for the middle class is a lifestyle standard.
Indulge occasionally, start small with luxury experiences as you celebrate milestones — you don’t have to go crazy spending all the time.
Travel Isn’t Just a Treat—It’s a Lifestyle
Vacations are an annual occurrence for most middle-class families, and you have to plan them and budget for them well. But the wealthy mostly make frequent trips, and they travel in the most style, skipping coach seats and budget hotels and opting for first-class tickets and five-star suites.
You Belong to Exclusive Networks
Elite clubs and societies membership or access — whether it’s golf resorts, business organizations, or cultural circles — is an obvious sign of wealth. And often, these networks open doors to awesome relationships and once-in-a-lifetime opportunities.
For example, clubs like Soho House provide exclusive access to creatives and thought leaders in the most high-profile industries.
Funding Your Children’s Education is Stress-Free
Education is too expensive for most middle-class families, but for people with money, it’s often already paid for. Whether it’s private schooling or Ivy League tuition, these costs don’t pull them out of their own financial comfort.
You Own Multiple Properties
For many people, owning just one home is important, but owning several properties — investment real estate or a vacation home in an exotic place — is a hallmark of affluence. For example, Forbes indicates that one of the ways in which the wealthy preserve (and grow) their wealth is via property portfolios.
Your Children Have Trust Funds
One of the marks of long-term wealth planning is building up trust funds for future generations. This means your family will remain financially secure and stable the rest of your lifetime, and long after you are gone.
You Plan Retirement with Legacy in Mind
Most middle-class retirement planning logistics are focused on day-to-day expenses. However, rich people think that in the future, they will write retirement plans that create lasting wealth for their families.
You Maintain a Substantial Savings Buffer
The wealthy often can set aside six months (and up) in living expenses, and middle-class families struggle to save for an emergency. Having that solid emergency fund not only proves that you are financially secure but also proves that you can weather a big unexpected cost.
According to a 2023 Bankrate survey, 57 percent of Americans wouldn’t be able to pay for a $1,000 emergency expense, making savings a true marker of affluence.
Investing is a Daily Practice, Not an Afterthought
Investing is not a one-time thing for the rich – it’s a well-structured process. For those who are financially successful, it’s second nature to actively grow wealth in stocks, in mutual funds, or even in new (startup) ventures.
The point is proven by people like Warren Buffett: smart investments compounded over time will generate truly immeasurable amounts of income.
Managing Debt is Effortless
Being rich doesn’t mean being debt-free. But unlike middle class struggling with credit cards bills, car loans or college loans, the wealthy tackle debt strategically. Instead of having high-interest consumer debt, they rely on a lot of “good debt” (mortgages, business loans, etc.) that helps them increase their wealth.
Time is More Valuable Than Money
As the financial needs of the wealthy decrease, time becomes more precious. These people don’t want to hustle for extra money; they want to focus on personal growth, relationships, and meaningful experiences.
Delegate the routine, prioritise the moments that are value adding for your life – be they hobbies or spending time with family.
Disclaimer – This list is solely the author’s opinion based on research and publicly available information.
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