Here’s a quick way to create your own affluent definition.

Conscious earning and spending by definition require thinking, lots of thinking. They also require feeling - as in accessing your intuition. The classic definition of “having a lot of money” is too vague to be useful in constructing an affluent definition.

The common synonymous, rich, wealthy, well off, well-to-do, prosperous, are only vaguely useful in helping you develop a plan for becoming and staying affluent.

All of the best selling books on personal finance include some sort of dictate for you to create your own affluent definition. But they don’t always offer guidance on how to proceed. Most are about investing. Telling you that being affluent truly is a state of mind is true, but you’ve got to eat. So let’s put the philosophical musings aside for a minute and devise an affluent definition that is about cold hard cash and is reality based.

What is the median income in the city where you live?

According to The U.S. Census Bureau, “median income is the amount which divides the income distribution into two equal groups, half having income above that amount, and half having income below that amount.”

Basically, if you earn more than the median income for the city you are living in then you are relatively affluent. It’s a good place to start when defining what it means to be well off. Check the list of median income by city (see excel doc below) to see what you need to earn to be to the right of the “have not | HAVE” line.

Now that you have a baseline what do you do? Well, that depends on a few things. The first being if you are currently living below or above the median income. If you are on the line - count yourself as above. If you are below and you want to be considered wealthy then you simply have to increase your income. Is it worth it to you? If you are already in the black, as far as median income goes, the question to ask is “do I feel comfortable?”

If the answer is yes AND comfortable is enough, then you rock on! If you are comfortable but you want more then you have some thinking to do.

What about the cost of living?

Skip the online cost of living calculators. While a cost of living comparison by city is useful to people contemplating a move it’s not that useful for those of us who are staying put. It’s interesting that the median income for a city has nothing to do with how much it costs to live comfortably there. Use this Living Wage calculator to determine if your income is sufficient for where you live.

Knowing the median income and the living wage for your city can give you a reality check. A lot of us are better off than we realize. Acknowledging this is a necessary step to creating an affluent definition that will help us acquire and maintain a level of prosperity that is both about good for us personally and good for the world-at-large.

Conscious earning and conscious spending are ways of thinking that take into account the fact that our actions (and non-actions) affect the communities in which we live and those beyond. What’s an affluent definition you can live with and work toward? 

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