What does it take to be considered rich in 2010? The old million-dollar standard seems defunct now that this amount is often touted as a minimum that should be saved for a comfortable retirement. Let's look at some recent attempts to pinpoint the new standard of wealth. (For related reading, also check out 7 Millionaire Myths.)
IN PICTURES: 6 Simple Steps To $1 Million
In the movie "Austin Powers," Dr. Evil, the villain frozen in the 60s and thawed in modern times, tries to extort the world's leaders. He demands $1 million, and they all laugh at him. Dr. Evil later figures out that he needs to ask for much more money - $1 million just isn't a significant sum. The bad doctor later ups his demand to a suitably sinister $100 billion.
Another popular reference to our changing standards of wealth occurs in "The Social Network," a 2010 movie about the founding of Facebook. A conversation between Justin Timberlake's Sean Parker character and Andrew Garfield's Eduardo Saverin character goes like this:
Sean Parker: You know what's cooler than a million dollars?
Eduardo Saverin: You?
Sean Parker: A billion dollars.
The exchange occurs at a pivotal point in the movie when Facebook has proven successful but has not yet hit it big and the protagonists are considering the website's future. Parker's remarks seem to reflect the changing standard of wealth - no longer is it enough to become a millionaire. Now it takes a billion dollars to truly impress the masses.
A billion dollars has also become the standard of great success at the box office. The highest-grossing movies of all time, "Avatar" and "Titanic" each made significantly more than $1 billion in worldwide box office receipts. So did "Lord of the Rings: Return of the King," "Pirates of the Caribbean: Dead Man's Chest," "Toy Story 3," "Alice in Wonderland" and "The Dark Knight." (To see a related movie list, check out The Actual Top Grossing U.S. Movies)
When Forbes first began compiling its lists of the 400 richest Americans back in 1982, just 13 of those people were billionaires. In 2010, every person on the list was worth at least a billion dollars, and the highest-ranked person, Bill Gates, was worth $54 billion.
Forbes' 2010 list of the world's billionaires includes a whopping 1,011 entries. Of those, 75 people are tied for last place with a net worth of $1 billion. These people come not just from the United States, but also from India, Turkey, China, Romania, Italy, Poland, Malaysia, Pakistan and other countries. And while a few familiar names grace the bottom of the list, like J. K. Rowling and James Dyson, many of these mere billionaires - and even some of the richest people on the list - are relatively obscure. You don't have to be a Warren Buffett or a Sergey Brin to find yourself at the top.
A 2008 book titled "The Middle Class Millionaire" states that 8.4 million Americans have a net worth between $1 million and $10 million, including home equity. We can assume that many people have fallen out of this category with the decline in home values since the time the book was written, but the idea that you can be a millionaire, or even a multimillionaire, and still be middle class shows how times have changed.
There are numerous books for sale with "billionaire" in the title. Claiming to teach ordinary readers how to achieve ultra riches are these popular titles (to name a few) in the business and investing category: "Trump Strategies for Real Estate: Billionaire Lessons for the Small Investor," "Think Like a Billionaire," "Become a Billionaire" and "Blueprint to a Billion: 7 Essentials to Achieve Exponential Growth." Even top-selling children's books like "The Billionaire's Curse," "Mr. Gum and the Biscuit Billionaire" and "Billionaire Boy" make a billion dollars the new standard to aspire to.
IN PICTURES: 7 Millionaires By Marriage
Travie McCoy's hit song, "Billionaire," describes what the singer would do if he had a billion dollars - adopt lots of children, give away several Mercedes, revitalize New Orleans, and fix the recession, among other feats. The song spent 20 weeks on Billboard's Hot 100 chart, peaking at No.4. Setting aside the fact that a billion dollars wouldn't come close to cleaning up after a natural disaster or ending a recession, the song sends the message that it takes a billion dollars if you really want to make a big difference.
A million dollars might not even buy you a house in one of America's top 10 most expensive cities for real estate, according to a September 22, 2010, MarketWatch article. The most expensive city on the list, Newport Beach, Calif., had an average list price of $1.83 million, while the least expensive on the list, Santa Barbara, Calif., had an average list price of $1.02 million for the period February to August 2010. And some surveys of wealth don't even include home equity in assessing people's net worth. The annual World Wealth Report defines high net worth individuals as "those having investable assets of U.S. $1 million or more, excluding primary residence, collectibles, consumables and consumer durables."
A 2009 Forbes article, "The Most Valuable Teams in Sports," reported that as recently as 2003, not a single professional sports team was valued at $1 billion. But 2008 saw 24 teams worth $1 billion or more. Soccer's Manchester United topped the list at $1.8 billion. Despite the recession, Forbes' most recent list has 25 entries: joining Man-U are 19 NFL teams, MLB's New York Yankees, and four other soccer teams. (For more, take a look at America's Richest Sports Team Owners.)
The Bottom Line
For many people, having a net worth of $1 million or even $100,000 still seems unattainable, yet these days neither of these figures is likely to impress anyone unless you attain them at a young age. Of course, even then, you'll be competing with the legacies of Bill Gates, Michael Dell and Mark Zuckerberg, all of whom were multimillionaires or billionaires before they turned 30.
Find out what happened in financial news this week. Read Water Cooler Finance: GM's Dramatic Return.
Personal FinanceA 4% or 5% annual jump in pay may not sound huge, but in today’s environment, it actually means you’re faring better than most.
Personal FinanceThe best time to look for a new job is when you already have one.
Personal FinanceCleats, pads and profits: we take a look at the top 10 most valuable sports teams in the world.
SavingsWhether you're leaving the Windy City or arriving with a stack of foreign cash, these are your best bets for currency exchange.
ProfessionalsGlobal wealth is rising and expected to continue. Advisors should know that the wealthy value fee transparency, performance.
InvestingMillennial investors are different from those in previous generations. Here are four Gen Y needs which are instrumental to understanding them.
Credit & LoansHow to avoid the most common issues and hassles raised by exchange rates while traveling abroad.
Fundamental AnalysisPart of fantasy sports’ success lies in one-day and week-long contests serving as an alternative to season-long games. FanDuel, a leader in this space, has recently surpassed a $1 billion valuation.
Personal FinanceThe popularity of golf peaked in 2003. To regain popularity and survive, the industry is adapting to appeal to a younger generation of players.
InvestingThe advisor managing your assets has the potential to change your retirement fate. Here are some tips to get you started on finding the right one.
A product that offers financial protection to golf tournament ...
Merchandising is any act of promoting goods or services for retail ...
A trading magnate also referred to as the Hedge Fund King and ...
A legendary investor who specializes in distressed debt and manages ...
Known for his short selling strategy, activist investor David ...
One of the most successful activist investors in the financial ...
An investor who is a high-net-worth individual (HNWI) may require private wealth management services. HNWIs have unique financial ... Read Full Answer >>
The takeover of Manchester United by the Glazer family beginning in 2005 saddled the historic club with substantial amounts ... Read Full Answer >>
Manchester United is one of the most popular U.K. soccer teams. Its principal stadium is Old Trafford, located in the heart ... Read Full Answer >>
Old Trafford Stadium was built for and is currently still owned by Manchester United Football Club (Man Utd.). This means ... Read Full Answer >>
According to Forbes, basketball player Derrick Rose holds the largest endorsement deal as of 2014; the deal is for more than ... Read Full Answer >>
The top three stadium naming rights deals of all time were all for stadiums hosting New York City teams. The largest was ... Read Full Answer >>