What is a Millionaire? The Levels of Being a Millionaire

What is a Millionaire?

Ask anyone if they wished they were a millionaire and you will get a resounding  “Yes!”On the other hand, ask those same people what it is that actually makes a millionaire and your answers are going to be quite different. I love asking people “What is a millionaire?”

Here are some of the answers:

“When you have a ton of money”

“When you don’t have to work any more”

  “When you are rich”

These answers prompted me to dig a little deeper on what actually makes someone a millionaire. Over the years the term millionaire and rich have always been synonyms.

The actual definition of “What is a millionaire?” is this:

millionaire |ˌmilyəˈne(ə)rˈmilyəˌne(ə)r|nouna person whose assets are worth one million dollars or more.

I found this to be a fairly light definition and the more thought I gave on the topic the more I realized there are several levels of being a millionaire.

Let’s face it, the definition of a millionaire is outdated.


So to clear up any confusion allow me to introduce the…

Levels of Millionaire

(Note: This refers to Net worth, if you need a primer on net worth you can find it here)

Level 1 – Millionaire Light

A millionaire is someone whose assets are equal or greater than $1,000,000.

This is what I call “Millionaire Light”, by the standard definition you are a millionaire but it takes very little to get there. Going back to our Net Worth Statement we can see that anyone who buys a million dollar house would qualify as a millionaire even if they owed more than a million dollars on the house. By their own definition you could be a millionaire with a negative net worth (owing more than you own).

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What is a Millionaire?

What is a Millionaire?

This may be the common definition, but it’s not the one I tend to think of when I think “Millionaire!” Mostly because it’s relatively easy to attain, and doesn’t indicate any level of financial awareness. I would imagine that in the first half of the 2000’s when there were more millionaires being made every month in the US it was largely attributed to people buying expensive houses that they couldn’t afford.


Yes you are a millionaire but you also can’t make the payments. This is NOT what I would call rich. Still if you are growing your Net Worth incrementally you will most likely hit this point and by definition you can call yourself a millionaire. Another example that I like is at one point Donald Trump was bankrupt but he would have still been a millionaire because his assets were in the millions, even though what he owed on those assets was far above the value of those assets.


Level 2 – Millionaire

This is the level that I commonly think of when I think of a millionaire. It’s when your net worth is a million dollars or more.

This demonstrates that you have been able to acquire assets while maintaining or decreasing your level of debt. Thus raising your net worth beyond the million dollar mark. With the working age increasing it will be very common that most people will earn over a million dollars in total over their working lives.

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How much of that million is kept and how much of it is grown beyond that point is up to you.

Level 3 – Millionaire Plus

This is when your net worth is over a million dollars when you EXCLUDE the value of your home.

This is probably a better representation of your overall wealth since you will always need to live somewhere. It should be a logical next step in your millionaire progression.


Level 4 – Millionaire Pro

Millionaire Pro is when you have enough money that you can write a check for $1,000,000 without hindering your life.


This is the next stage of millionaire and it’s where you want to be. Just to be clear, you never have to actually write that check but you have the ability to do so. Either through investments, businesses, cash, or other holdings you have chosen.


Level 5 – Millionaire Extreme


What is a Millionaire

What is a Millionaire ?

This is when you have a Net Worth in excess of $5,000,000 and can easily (though not necessarily ever done) write a check for an amount for anything you could possibly want.

There is more to life than money and most wealthy individuals will tell you that money is more of a way of keeping score once you have enough of it.


Therein lives the issue, until you have enough of it , until that happens it will take up at least part of your thinking. The emotional part of money is outside the scope of this post.


Of course this is just my humble way of looking at things. I like to know where I am at and it’s always good to have something to shoot for. When you are climbing the Net Worth Ladder you need to know what the next step will be so that you have something to aim for.  Before you can get to the various levels of millionaire you will need to climb the Net Worth Ladder.

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4 thoughts on “What is a Millionaire? The Levels of Being a Millionaire

  • Good observations. We have fortunately move through each of these benchmarks. I am currently counting down my last few months in the office. Over the last year, we have banked every one of our paychecks to give away for philanthropic purposes in early retirement. It is our way of giving back at the end of our careers.

  • I’m aiming for Millionaire PLUS.. lol, not sure if I’ll get there. So much of my net worth is tied up in the house, but I agree that “millionaire” doesn’t mean much these days. Our city has seen some rampant house price inflation, anyone who owns their own home is almost millionaire by the old definition.

    • That’s just it! With a “standard definition” you can be a millionaire with a million dollar home and 2 million dollar mortgage. So a negative net worth and still considered a millionaire. It’s crazy! Good goal aiming for Millionaire Plus! Keep me posted on the progress.

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