Americans Need $5.3 Million Net Worth to Be Considered Financially Successful: Survey

U.S. dollar bills in Washington on Oct. 4, 2024. Madalina Vasiliu/The Epoch Times

Americans have high expectations of what it means to be financially successful, but many of them do not expect to meet their desired level of success, according to a survey by financial planning company Empower.

An annual salary in excess of $270,000 is needed for a person to be considered successful in the United States, the Nov. 22 survey found.

In terms of net worth, the threshold is at $5.3 million.

According to the Social Security Administration, the national average wage last year was $66,621. Meanwhile, the average net worth of a family in 2022 was $1.06 million, according to data from the U.S. Federal Reserve.

Amid high expectations, almost half of the respondents said they will never achieve the success level set for themselves. Currently, just above one-third consider themselves to be financially successful. Half the respondents said they are not better off than their parents, and will never be.

The state of the economy and insufficient or irregular incomes were cited by respondents as major challenges to achieving their desired level of success.

Other factors include not knowing how to manage finances, not having clear financial goals, overspending, debts, and delaying financial planning.

In May a report from the U.S. Federal Reserve revealed that the share of Americans doing “at least okay financially” fell from 78 percent in 2021 to 72 percent last year. Even though inflation declined in 2023, it continued to be cited as a key financial concern.

The financial situation for a majority of adults worsened compared to the previous year because of changes in the prices of goods and services, the report said.

A Gallup survey from earlier this year found that inflation was cited by all income groups as a key financial problem, with more than 40 percent of households on annual incomes of more than $100,000 worried about the issue.

Inflation Weighing on Lifestyle

An October report from Bank of America found that around 20 percent of households with annual incomes higher than $150,000 appear to be living paycheck to paycheck. Bank of America speculated that the reason could be tied to home purchases.

“Higher-income households may have bought larger, more expensive, homes and consequently have bigger mortgages. And often along with bigger homes come bigger insurance costs, property taxes, and utility bills,” the report said.

According to an April report from financial service company PYMNTS, one-third of high earners were living paycheck to paycheck. Among those earning $100,000, this figure was 48 percent.

More than 20 percent of individuals making over $200,000 and fully dependent on monthly salaries to make ends meet said they were living with tight budgets because of insufficient income.

During his election campaign, former President Donald Trump vowed to tackle inflation.

The Republican Party has proposed broad measures to lower inflation, one of which involves boosting American energy production.

“Republicans will unleash energy production from all sources, including nuclear, to immediately slash Inflation and power American homes, cars, and factories with reliable, abundant, and affordable energy,” states the GOP 2024 platform document.

Other proposals include reining in wasteful federal spending and cutting down costly and burdensome regulations. Republicans also aim to stop illegal border crossings into the United States and deport illegal immigrants.

Open border policies have resulted in driving up the cost of housing, health care, and education for Americans, the document states, suggesting that tackling the immigration crisis would contribute to lowering inflation as well.

However, Ralph McLaughlin, senior economist at real estate listings website Realtor, says president-elect Trump’s proposed crackdown on illegal immigration could end up having “large and negative consequences on the U.S. housing market in both the short and long run.”

McLaughlin said deporting illegal immigrants could “severely hurt the labor supply needed for new homebuilding since up to a third of residential construction employment consists of foreign-born workers.”

In the long run, the “broader economy” could end up being negatively affected, he said.