George Kamel - Why Do Rich People Say They Feel Poor?

Starting point is 00:00:05 I'm going to assume most of us would agree that $175,000 is a pretty decent income. Think about it. If you're chronically hyperactive nephew grew up and started making $175 grand, you'd be impressed with the little guy. But you know what happens when you assume you'd become an assumptive person? That's not how that goes. Because research shows that $175,000 income earners don't quite feel that it's up to snuff. So today, we're talking why so many wealthy people feel poor,

Starting point is 00:00:31 plus one simple rule that will help you feel like you have more than enough, guaranteed. But before we tackle this hard-hitting content, tackle that like your little nephew tackles you. It hurts so much because he loves so much, and I expect the same from you. Does someone need a hug? So all this started when the data nerds at Bloomberg surveyed objectively wealthy Americans making 175,000 bucks a year, which by the way is basically the top 10% of U.S. tax filers. These people, who some call, quote, regular rich, were asked the suggestive question, do you feel rich? Not to be confused with the other suggestive question that's frequently asked, are those on cloud? Yes, they are, Darren, and we've already talked about the arch support.

Starting point is 00:01:13 Okay, I like them much better than my Hokas. That's how you know rich people are talking to each other, by the way. It's Hoka on cloud conversation. Of the survey respondents, about a quarter of them said, yes, I feel rich or very rich, which makes me happy or very happy for their fortune. But what doesn't make me happy is how the other three quarters or so of people respond. About half of these high earners describe themselves as, quote, comfortable, which translated to modern speak is pretty much this meme in real life. A little uncomfortable, it's fine, everything's fine. And that brings us to the remaining quarter or so of respondents

Starting point is 00:01:47 who identified themselves as very poor, poor, or, quote, getting by but things are tight. Think about that for a second. One out of four people earning $175,000 feels poor. And sure, you could post hypotheticals all day, like, well, maybe they have nine kids, or maybe they live in San Francisco, or maybe it's Taylor Swift's brother. But regardless of those crazy outliers, what is actually happening here? I am so confused. Well, to be fair, things are costing more these days.

Starting point is 00:02:14 And even though inflation has been down from the wild highs of 2022, that doesn't mean that prices are down. That's because inflation is technically the rate of price increases over a period of time. So even inflation being down year over year just means that the rate at which prices are increasing has slowed. But the actual prices themselves for good and services, Still high. Another reason these people could feel poor is if they have a kid or two or three in childcare, since those costs are higher than Seth Rogan on the King de Kock coaster at Six Flags Great Adventure. Not to mention the unfortunate phenomenon of lifestyle creep, which, much to my disappointment,

Starting point is 00:02:48 is not an emo ban from 2007. Because tonight will be the night that I will fall for you. Lifestyle creep is when your income increases and you're spending creeps right up to meet it, so you're not actually gaining any more margin in your monthly finances. it's a possibility that the reason these people don't feel rich is not because they don't make enough money, it's because they spend everything they make on stuff they don't need. And listen, this isn't a theory. I talk to people all the time as I co-host the Ramsey show, and they call in, and they're making six figures, and they are broke because they're spending more than they make, and they've got huge debt payments, huge mortgages, huge car loans,

Starting point is 00:03:24 thousands in credit card debt, the HELOC, the pool loan, you get the picture. But even with all of that and a million other theories that are probably valid, I don't think that quite gets to the heart of why rich people don't feel rich right now. Now, we'll talk about my hypothesis in a second, but first, it's time for our regularly scheduled security check. I know, I know, security isn't exactly fun. But you know, it's even less fun, getting your identity stolen and having your info all over the web. It happened to me, and let me tell you, it's no picnic.

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Starting point is 00:05:03 Okay, back to the heart behind why rich people feel poor. Disclaimer, things are about to get slightly meta, so just stay with me here. I think the reason for this is because wealth is relative. And here's a story I found in the Wall Street Journal that helps explain what I mean. There's a 41-year-old executive at a healthcare staffing company in Tampa, whose pay has fluctuated around $400,000. I imagine on weekends he cleanses it. and goes to the Salvador Dolly Museum down the road with an annual pass.

Starting point is 00:05:28 But that's neither here nor there. Here's what he had to say about his income and wealth. Quote, I don't think of myself as rich. I think of myself as having worked really hard." End quote. He and his wife do things like make coffee at home to avoid Starbucks and buy fruit based on what's on sale. But let me tell you, even if honeydew is on sale, I'm not buying it. Alright, I'm not falling for your low-tier filler fruit.

Starting point is 00:05:49 Nobody ever wants honeydew, but it's always there. Do better. He goes on to say, quote, we're not extravagant people with high-end country club memberships or a private jet or anything like that, end quote. Now, on one hand, I respect this guy for valuing hard work and being smart with the spending, and clearly, he's very smart, he's very successful. On the other hand, this is kind of what I hear him saying. Sure, we make a lot of money and we're comfortable, but some people are richer than we are,

Starting point is 00:06:11 with way more stuff like private planes. What I'm trying to get out with this story is that the goalposts begin to move when you make more money and increase your wealth. Because the more money you make, the more wealth and wealthy people you're exposed to. And the more people you're exposed to, the more you start comparing yourself. And the thought of, if I could just make that much money, I would feel wealthy, could quickly turn into, sure, I've built some wealth, but I don't have nearly as much money as those people. Because you see other people who are more successful or earn more and have more, suddenly

Starting point is 00:06:43 they're the rich people, not you. So the solution to all of this, for starters, say no to debt, avoid lifestyle creep, and this should go without saying, but avoid real life creeps. Because you can't control prices, but you can control how you spend and how you manage your money. I'm the boss. So some things you can do, you can switch to generic brands. You can change where you shop. You can buy a used car and cash instead of taking out a loan for some status symbol that will plummet and value the minute you drive it off the lot. Next, you got to stop the comparison game.

Starting point is 00:07:13 I mean, guys, if you like games, there's a ton of other fun games you can play out there. Head to your local cracker barrel, the peg game is totally free and way more fun. Now, lastly, as your income increases throughout your career, your goal should be to have more expendable income and margin to build wealth with. Not a country club membership and a C-Doo. In fact, this is the key to feeling like you have more than enough, whether you make 175K or not. So how do you get this magical thing called margin? You have to create an intentional spending plan with a budget. And listen, budgets aren't for broke people, and they're not for rich people, and they're not for Excel accountant nerds.

Starting point is 00:07:47 They're for anyone who wants to win with money and create some margins. And my favorite app to budget with is called Every Dollar. So check it out for free with my link below in the description. Because regardless of your income, the rule to remember here is if you can create 40, 50, even 60% margin with your income to do whatever you want with, invest, save, spend, and give, you will never feel poor. So lesson learned, the more margin and contentment you have, the richer you will feel. Now, if you can relate to the people in this video who make a solid income but still feel like they don't have enough, you may be suffering from something experts are calling money dysmorphia. Not to be confused with dyspepsia,

Starting point is 00:08:23 which can be equally upsetting but solvable with a shot of pepto and a boycott on Bubly. So to find out if there's something deeper lurking beneath the surface that's informing how you feel about your wealth status, be sure to check out this next video on money dysmorphia or just click the link in the description below. In the meantime, share this video with a friend who you'd love to ride King to Caugh with. And as always, thanks for watching. We'll see you next time.

George Kamel - Why Do Rich People Say They Feel Poor?

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