Jan 2, 2026
A million dollars used to be the finish line. Today, it barely feels like a milestone.
Research from Northwestern Mutual shows that only 36% of U.S. millionaires identified as “wealthy” last year (1), despite having at least $1 million in investable assets — a number that once symbolized financial freedom. In 2025, rising costs, shifting expectations and relentless comparison reshaped what “rich” meant, even for Americans who may technically qualify.
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The study suggests a psychological shift that reveals just how dramatically the economy, cost of living and social norms have evolved.
The millionaire boom
The U.S. now has nearly 24 million millionaires, the largest population of high-net-worth households in the world, according to UBS’ 2025 Global Wealth Report. (2) Wealth creation accelerated during the pandemic as home prices surged and more Americans invested in the stock market.
But even as more Americans cross the millionaire mark, there are many reasons why a million no longer feels like wealth. The location gap plays a major role: a million dollars in rural Oklahoma or Missouri can provide a spacious home, relatively low taxes and plenty of financial breathing room.
But in heavily populated coastal metros, like New York City or Los Angeles, hot real estate markets mean it might not even cover a modest condo.
Lifestyle expectations also magnify the divide. Millionaires tend to socialize with other millionaires, which means they’re constantly comparing themselves to friends, colleagues or social media influencers who may have far more — a form of financial relativity that makes even seven figures feel small.
Advisors say this “comparison trap” (3) is powerful. When everyone around you appears to be earning more, investing more or inheriting more, a million dollars stops feeling exceptional. In that context, wealth becomes relative — and for many, perpetually out of reach.
“All of my clients who are millionaires do not consider themselves wealthy, not by a long shot,” Liz Windisch, a certified financial planner in Denver, told USA Today. (4)
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If $1 million isn’t enough, what does it take to feel rich?
The Economic Policy Institute reports that the average American household income as of 2023 was $80,610. To be in the top 20% of earners, you’d have to make almost double the average, over $130,500 a year. (5) While the IRS benchmark for being a 1-percenter is income above $540,009 per year, the Institute puts that figure at $819,324 a year. (6)
Housing, childcare, medical care and education now consume far larger portions of household budgets than they did a generation ago. Inflation has steadily eroded purchasing power, creating the sense that no amount of money goes as far as it should.
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And for many affluent Americans, the pressure to save for retirement, help aging parents, fund their children’s education and still leave an inheritance creates an ongoing sense of financial insecurity.
What everyday Americans can learn from millionaire anxiety
For most people, the antidote may lie in redefining what financial comfort means. Experts increasingly recommend setting a “financial freedom number” (7) based on your expenses, not your net worth.
If you can cover your needs, most of your wants and save for the future without stress, that’s financial comfort regardless of how your net worth compares to someone else’s.
Avoiding lifestyle creep is equally important. As incomes rise, spending tends to rise with it, erasing progress and fueling the sensation of always needing more. Guardrails like capped discretionary spending or automated transfers into savings can help keep lifestyle inflation under control.
Investing early and consistently, ideally through automated contributions, is another cornerstone. Compound growth remains the great equalizer, and it matters far more than whether you ever reach the millionaire club.
Finally, long-term planning should start with realistic assumptions about retirement spending, life expectancy and health care costs. Your savings target should reflect the life you want to live, not the net worth someone else posts online.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
Northwestern Mutual (1); UBS Global Wealth Report (2); Hendershott Wealth (3); USA Today (4); Economic Policy Institute (5); Forbes (6); HonestMoney (7).
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Chris Clark is a Kansas City–based freelance contributor for Moneywise, where he writes about the real financial choices facing everyday Americans—from saving for retirement to navigating housing and debt.
