What is “Almost Rich” Anyway?
There’s an article at Toronto Life magazine which alternates between interesting and obnoxious. Called “Almost Rich“, it’s written by “one-percenter” Jonathon Kay, who hopes to dispel what he sees as a mistaken belief that he and people like him never worry about money.
It’s valuable insofar as the top one percent in Canada isn’t necessarily obscenely rich. That’s more like our top 0.1 percent. Getting into the top one percent requires an annual household income of not quite $200,000, which is certainly a lot of money, though it’s not such a mind-blowing sum one can’t imagine ever spending it all.
And that’s worth noting. There’s the lower echelons of the one percent, who are very comfortable. And then there are the real high-rollers, whose money is, for all intents and purposes, infinite. There is a practical difference between these groups. I acknowledge that first point. Then the argument starts to go off the rails.
Kay argues that he feels like he is essentially middle class. By his own admission, he has more money than 99 percent of the people around him. Yet, as he tells us, he and many of his friends find themselves living month to month, often even in heavy debt. He also complains how difficult it is to compete with your friends by having the right kind of furniture, car, etc. That’s a very middle class problem, isn’t it?
Let’s make this simple. What does it tell you when somebody who has four times as much income as you ends up just as broke at the end of the month? Give up? It means they’re spending four times as much.
I don’t actually begrudge any of the people profiled in that article for making as much money as they make. It’s more than a little disappointing that six of the seven earmark no money at all for charity. It bespeaks a certain “me” attitude to spend $800 a month on wine and not a red cent for a worthy cause. (It’s almost as self-indulgent as writing an article about it and expecting, apparently, sympathy.) Still, it’s not the income itself that is the problem. It’s the woe-is-me attitude.
Kay is pulling a fast one: he’s focusing on the surface similarity of this “hand-to-mouth” financial behavior, while glossing over the fact that almost all this spending is for luxury items. And that makes for a very big practical difference between Kay and his ilk and the rest of us.
A person who buys a new Mercedes every three years, or lives in a million (or multi-million) dollar home, or† any of a laundry list of other indulgences, has options. If money’s tight, they can live in a smaller house, a less exclusive neighborhood, send their kids to public schools, drive a less expensive car — any of these small sacrifices would immediately take them out of the red.
What options are available to a person whose monthly expenses instead go to food, affordable shelter and non-designer clothing? Eat less? Go naked? “Mo’ money, mo’ problems” sounds disingenuous coming from someone in this income bracket. Spending your money as fast as you make it does not qualify you as middle class. It qualifies you as either bad at math or incapable of delayed gratification. That may be true of many middle class individuals as well, but it’s not a defining characteristic of the group.
I do want to note that I don’t consider Kay and others in his income bracket as the enemy. They’re not the Wall Street tycoons that have screwed over the rest of us. Half of the people profiled haven’t even contributed to their RRSPs. It’s worth pointing out that, despite its effectiveness as a slogan, the one percent isn’t a homogeneous group, and certainly not all of them are financial movers and shakers, pulling all the strings behind the scenes.
The people in this article make more money than most of us, but, again, I don’t hold that against them. I wouldn’t mind being in that income bracket myself, but I also understand that I really don’t have anything to complain about. Kay, who makes more than four times what I do, might do well to recognize he doesn’t either.
Photo credit: United States government