I went with 500k, a level that I believe a regular household would be able to live reasonably free and easy given they don't go subprime and take out massive loans or anything like that. If my household earned 500k (so we pulled ~7k per week after tax), we would be very comfortable and be able to build up a Chinese-size warchest of savings and investments.
My household is at 110k right now, and living comfortably but by no means extravagently or excessively (have private health insurance, two cars, go out regularly - only middle class staple we don't have is Foxtel). We don't need to borrow any more to fund things like houses or cars, so the plan from here is essentially to start building the empire. Our debt levels are probably around 35% of our income, so not huge but on the larger side I would think. Its a deliberate move, in my line of work its highly unlikely that I will lose income moving jobs, and my wife is in an industry that can reward handsomely if you are committed. And so, assuming things don't turn to shit (you can never really plan any other way, IMO) our living standards will only go up from here.
A doubling of our income would just go to paying down debt and investing, but a five-fold increase...I would consider ourselves rich.
A few broader observations:
- Rich is a very subjective term. 500k for someone with a propensity to binge spend or be irresponsbile is probably not much, but 500k for someone who is a squirrel would probably be rich.
- The way I see it, people's marginal propsensity to consume (percentage of additional dollar of income earned that is spent) is very high up until really high income levels. I would say, with little basis, that most households would spend 80% or more of additional income earned right up until you hit the million plus income mark (I'm counting debt repayments as spending here, btw, but not investments or savings). There is always more stuff to buy, and so earning more income doesn't necesserally equate to being "rich".