The survey found that feeling rich requires a lot less money than it takes to be rich

It takes more than $2 million to be wealthy, according to a new survey of average Americans. But it only takes a quarter of that number to feel rich.

This is one of the takeaways from Charles Schwab’s Seventh Annual Modern Wealth Surveywhich polled 1,000 Americans about saving, spending, investing, and wealth.

When asked how much they considered wealthy, respondents returned an average of $2.2 million. However, the survey found that among the 48% of Americans who already consider themselves wealthy, their median net worth was $560,000.

The findings reveal the public’s changing perception of what it means to be rich, with many associating wealth with luxury rather than net worth. But experts said financial planning still plays a role in feeling rich, however defined.

“People define wealth differently when asked how to set a dollar amount or when asked what it means to be wealthy,” said Rob Williams, managing director of financial planning, retirement income and wealth management at Charles Schwab. Yahoo Finance. “I think the actionable point we’re making is to think carefully about what wealth means to you holistically.”

More than 3 in 5 Americans said having a healthy relationship with loved ones is a better way to describe wealth than “having a lot of money.” The survey also found that 40% of Americans mentioned “luxury” when asked about wealth, compared to 32% who answered “money” and 26% who said “assets.”

For example, when asked to describe what money means to them, 70% of Americans said “enjoying experiences” over “having nice things.” Also, 69% of Americans choose to “have a healthy work-life balance,” while less than half of that share – 31% – choose to increase their earnings. About 63% chose good health, while 37% chose success.

“I think Covid may have caused some of this,” Williams said. “[We’ve] Everyone reassessed what it means to be healthy, to be wealthy, to be confident in our financial lives, and more about our current lifestyles.”

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Some financial planners have noticed this change in perception among their clients, too.

“Customers don’t ask, ‘How do I get a million or two million in my portfolio?'” “They’re asking, ‘How do I get enough so that work is an option, or so that I can work part-time?'” “,” Kassi Fetters of Artica Financial Services, per Yahoo Finance.

“They’re asking, ‘How do I cut back on my expenses, so I can spend time with our new baby instead of working all the time?'” “Time and flexibility considerations align with the term wealth now.”

The survey also revealed that only a third of Americans have a financial plan, which Williams said is integral to cultivating the lifestyle that is most important to them.

“We all feel like we have a plan. You might say, ‘I’ve thought about it, I think, sure, I intend to retire someday.’ But it’s not very tangible. It’s not written down,” he said. “So this is like, ‘I want to run a marathon.’” Well, okay, that’s a nice ambition. What did you document? What steps will you take to get there? [It] It requires discipline and patience.”

Sean Lovegen, financial planner from WJL Financial Advisors, LLC, explained that a detailed financial plan can also make clients “feel rich” because it highlights the “long-term sustainability of their investment portfolio and shows how it can support the lifestyle they desire.”

“By showing clients how many years their portfolio can last, the plan quantifies the value of their assets in terms of their longevity and promotes a sense of financial security,” said Loveson. “This makes the value of the assets appear more ‘real’ and helps clients gain a better understanding of the true value of their portfolio, which helps foster a sense of abundance and confidence in their financial future.”

A financial planner can tailor a plan to Americans’ individual needs and desires, said Wes Patel, a financial planner who works with federal employees. For example, a financial plan can help someone balance goals they want to achieve while caring for aging parents.

“If we can talk and put together a plan to get them to maximize their retirement first, and then work on additional savings, they can find peace.” [and] A fortune in the fact that, one, they will not need to depend on someone else in the future, and two, that they are fulfilling a duty that is important to them,” Patel said.

According to the poll, 70% of Americans who came up with a detailed financial plan said they “felt more in control of their finances” and 90% said they felt confident that they would “achieve their financial goals.”

“Financial planning helps articulate what you want your current and future lives to look like and how we’re going to get there,” Fetters said. “I think pursuing financial planning is akin to pursuing an intentional life.”

Dylan Kroll Yahoo Finance Correspondent.

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