“The reward would be…”
“Well, more wealth than you can imagine.”
“I don’t know — I can imagine quite a bit.”
—Star Wars: Episode IV – A New Hope
Let’s say you’ve done very well and you have a six-figure income and, say, four million bucks in the bank. And you start to feel guilty: Should I really have this much money when so many people are struggling to feed themselves?
You could give it all away. Let’s assume there are four billion poor people on the planet, so divide that into your four million dollars, and each of them receives … excuse me while I whip out my calculator … [*click-click-click*] … one tenth of a penny per person.
Well, that’s not gonna help.
Wait, I know! What if, somehow, everyone could be rich? Could everyone have four million dollars?
Let’s find out. Take America as an example. In 2015, the total assets of U.S. citizens (real estate, stocks and bonds, cars, smartphones, PlayStation consoles) minus debt (mortgages, credit card balances, and the amount you still owe your bookie) was about $85 trillion dollars. Divide that by the 2015 U.S. population and you get a bit more than $265,000 per person.
So if you divvy it all up, every adult and child in America would be worth about a quarter mil. Not bad, but certainly not four million dollars apiece. So that won’t work.
Oh, wait, I got it! Maybe “rich” can be redefined so that more people fit the definition. Maybe $265,000 is rich by anyone’s standards.
Well, first off, you can’t live on it forever. It’ll run out after several years, even if you invest it. You’d need a cool million earning 8 percent just to have an income, after taxes and inflation, of around $30,000 per year. (Give or take. Your mileage may vary.) And thirty grand doesn’t get you anything fancy these days. But at least one person could survive on it indefinitely.
So every American would need at least four times as much money as is available today to be able to retire.
Of course, if everyone suddenly retired at this point in history, all the factories and gas stations and restaurants and bars would close, and nothing would be produced. We’d starve. Dang.
Okay, let’s start over. What, exactly, is “rich”? Dictionary.com defines it as: “having wealth or great possessions; abundantly supplied with resources, means, or funds . . . ” “Great possessions” and “abundantly supplied”: these suggest much more than is owned by the typical schmo. But if everyone got the same amount — say, one million dollars — that would become the new “average”, not “rich”. Hmm.
On the other hand, four million dollars? Now, that’s getting somewhere. Thus if you’re worth millions, you’re still not off the guilt hook. But I have one more idea that might help.
It involves purchasing power. The average American — and the average European, Japanese, South Korean, Taiwanese, Chilean, etc etc — has more wealth than nearly every other human who has ever walked the Earth. Compared to those others, today’s middle-class groups are fabulously rich, abundantly wealthy with great possessions.
A citizen in today’s industrialized countries can own things never dreamt of by the kings of yore. What seem normal to us — quick cheap flights to weekend vacation spots, streaming movies on high-def stereo TVs, instant chats with people in other countries — would have been impossible a century ago. Our average income thus has enormous purchasing power compared with the past.
That purchasing power keeps growing, year after year, as technology improves. In the future, a mere $30,000 below-average income could have several times its current purchasing power. In effect, a future $30,000 would afford what a six-figure income buys today.
Eventually each of us will have so many resources available from our lil’ ol’ average incomes that we’ll find ourselves possessed of the luxury and leisure and ease that the wealthy have always enjoyed. Like the idle rich of old, we won’t even have to work anymore — not if we don’t want to. The machines we’re building today will do that work for us tomorrow.
So if you’re still feeling guilty about having more than others, you can do two things: (1) invest your wealth in businesses that hire workers to produce the wealthy future that’s looming just over the horizon; and (2) dedicate your own work efforts to building that future, one in which everyone will have more than they know what to do with, to the point where money will no longer be an issue — a future where people will be judged more on their creativity than their bank accounts.
If, on the other hand, you’re wishing you had enough money to feel guilty about, please note that nowadays the quickest way to obtain filthy lucre is much the same: work to build a wealthy future for everyone.