A recent survey conducted by Empower shows that Americans perceive a need to earn more than $270,000 annually to achieve financial success. This amount significantly exceeds the U.S. median household income, which stands at approximately $80,000 for 2023. The findings indicate that only 37% of those surveyed view themselves as financially successful at present.
Respondents identified various obstacles to achieving financial success, including economic conditions (35%), income fluctuations (30%), and the absence of clear financial objectives (28%). Different generations hold varying views on what constitutes financial success. Members of Gen Z believe that an annual income surpassing $550,000 or a net worth exceeding $9 million is essential for success, which are the highest thresholds across all generational groups surveyed.
In contrast, older generations adopt more conservative views, often considering an annual income of around $100,000 or a net worth above $1 million as indicators of success. Notably, the survey indicated that the most significant aspect of financial success is not merely wealth but the effect that financial resources have on one’s quality of life.
Perceptions of Financial Success Among Americans
Almost 60% of participants associated financial success with the ability to spend on things that bring joy and fulfillment. “There is a clear link between money and happiness for many Americans,” stated Rebecca Rickert, communications head at Empower. Besides happiness, 35% of respondents prioritized having leisure time to engage in personal interests, while an equal proportion valued physical health as crucial metrics of success.
Financial experts advise striking a balance between saving for future needs and enjoying current life. Shaun Williams, a private wealth advisor and partner at Paragon Capital Management, recommends customizing budget allocations based on individual financial situations rather than strictly adhering to guidelines like the 50-30-20 rule. He also encourages starting with modest savings if larger contributions are not practical.
“We might find ourselves stretching our budget just to save 5% or 10%,” remarked Clifford Cornell, a certified financial planner at Bone Fide Wealth in New York City. Ultimately, grasping one’s personal financial necessities, desires, and aspirations is vital for realizing a balanced and rewarding financial life. By achieving the right equilibrium and planning according to personal circumstances, individuals can attain both current enjoyment and sustainable financial health.
