How Much Money Is “Enough”?

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13 Jan 2024
41

Greetings to everyone.

I saw two surveys on X today. In the first survey, I asked a question about how much money you need to have to feel "wealthy". The options were 250 thousand usd, 500 thousand usd, 1 million usd and 10 million usd. The overwhelming majority of respondents (over 75%) stated that they would consider themselves wealthy if they had a portfolio or assets of 1 million USD or more. There were also people in the comments who stated a lower amount. This survey showed that portfolio size is very important in the financial community and everyone has portfolio size targets that are much higher than what they have.

In the second survey, the question was how much money do you need to feel "financially comfortable"? This time, the overwhelming majority agreed that they need 1 million USD or more, although it decreased slightly. So how much money can we really say is enough for us? Is there a way to give such a number? Let's talk about this a little bit.

Based on Charles Schwab's 2022 Modern Wealth Survey, it was stated that the average US citizen participating in the survey should have 2.2 million USD to feel wealthy. Individuals who participated in the same survey stated that they needed 774,000 USD to be "financially comfortable". When we compare these two surveys, we conclude that the concept of wealth and financial comfort are perceived differently by the US public. When we say wealth, we mean people who spend all their time traveling around the world on their private yachts or who eat caviar and pop champagne every day.

However, in the same survey, "What does money mean to you?" The majority of participants answered the question: freedom and flexibility. Here, both temporal and spatial freedom come to the fore. Individuals who feel trapped in the shackles of 8-5 work and workplace want to reach this 2.4 million or 774 thousand USD with the dream of being free and flexible. No one wants to live like rich people or billionaires.

Concepts such as freedom and flexibility mentioned above are subjective concepts that can vary from person to person. Maybe we have concretized financial freedom to some extent with the 4% rule. When we reach a portfolio that is 25 times our annual expenses, we can stop working for money, saying "it is enough". So how do we measure concepts such as flexibility and opportunity with money? Maybe that's why people always tend to give high figures about how much money they need. What if it's not enough? What if an unexpected situation arises in the future? What if the stock market crashes and our companies go bankrupt? Examples can be multiplied. What I mean here is that it is not easy to say "it is enough for me", but we must be aware that our life is limited.

So what do I think?


When I opened this blog and started my journey to financial freedom, my goal was to reach a portfolio of 500,000 USD and retire early.Frankly, it is difficult to say, but as I mentioned in my end-of-year article, we set a new goal for ourselves. This figure, which is a 120% financial freedom level, corresponds to 600,000 USD. So, did we do this because 500,000 USD was not enough? Answer is no. The reason we set this new number is because I believe the dollar is not currently worth its true value and I think there will be a lot of up and down movements during turbulent times. It is very important to be able to say "enough" in some situations in life. Our most valuable asset in this limited life is our time, and the last thing we want to do is spend it working 8-5 and waiting for the salary to be given by an employer. That's why I think everyone should set achieving financial freedom as a goal. You don't have to quit your job when you reach the number you set. Just having the option to quit when the day comes is worth it. I wish success and ease to all financial freedom travelers.

Thank you for reading.

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