Do you still want to be a millionaire?
I read an article about Canada’s wealth recently and it got me thinking – is a million bucks really that much money anymore? Do you still want to be a millionaire?
According to the article I read, one latest study revealed Canada now ranks #5 in terms of millionaire households from countries around the world. Here are the top-10 countries from the list/article:
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The article goes on to say that millionaire households in Canada now account for 3.5% of all families and they comprise more than 30% of the entire country’s wealth.
(The study qualified millionaires are those with more than $1-million in U.S. dollars in financial assets but those assets exclude real estate.)
Given that qualifier I would say absolutely $1 million owned or vested (including pensions, life insurance, stocks, bonds, cash, other) is still a very healthy chunk of change. A few years ago I wrote if you’re a Gen Xer I think you’ll need at least $1 million saved for retirement, and likely more if you’re a millennial, to retire well. For further context, that $1 million saved and invested for your retirement should exclude government pensions and programs like Canada Pension Plan (CPP) and Old Age Security (OAS). Count on yourself before you count on government policy.
When it comes to our financial plan, one of our aspirations remains to own a $1 million personal portfolio (excluding our real estate and pension assets) in order to “live off dividends” to some degree. We feel such an approach will be valuable for these key reasons:
- There are simply too many unknowns about our future. Keeping our capital intact will be an enabler for some “what ifs” in life and flexible financial decision making.
- It doesn’t really matter whether our passive income comes from stock dividends or ETF distributions or both; this income will help replace part of our salaried income.
Do we still want to be a millionaire?
Heck ya. We’re only “there” if you include our home equity today. We’ve got some distance to go to semi-retire within the decade.
Back to you, I still believe a million dollars is a big bucket of money to own. This is especially true if you have saved and grown this money without the help of any workplace pension plan or you’ve been largely shut-out of the real estate boom in major cities like Toronto and Vancouver.
$1 million in financial assets is a sizable sum of money most Canadians will never own.
What’s your take on the millionaire club? Do you aspire to be in it? Are you working towards it? If so how?