45% of Americans say this is the best way to build wealth—but only a fraction are doing it

Your personal definition of wealth may have little to do with how much money is in the bank. You might feel wealthy because you’re able to spend a lot of time with your kids or because you’re pursuing a career you’re passionate about.

But however they’re defining it, the majority of Americans — nearly 60% — believe they’ll never be wealthy, according to a recent LendingTree survey. 

The online lending marketplace asked 2,000 adults how they feel about their wealth prospects and found a fair amount of pessimism. Just 20% of adults said they currently feel wealthy. 

The majority of adults say wealth is more about having financial security and comfort than hitting a milestone, such as earning a six-figure salary or having a million-dollar net worth, LendingTree found.

Here’s what people think could help them build wealth and what they’re doing to get there.

While there may currently be a shortage of homes to buy, there’s no shortage of examples of people who have built significant wealth through investing in real estate, from big names like Barbara Corcoran to smaller-time investors like a couple in Michigan earning $11,000 a month from their properties.

And when asked the best ways to build wealth, real estate was the most popular response, LendingTree found:

• Real estate: 45%
• Stock market: 32%
• Savings bonds: 21%
• Cash: 21%
• Tax-advantaged retirement account: 16%

Not only was it most popular overall, but each generation also said real estate was the key to building wealth. Baby boomers — defined as adults ages 59 to 77 — were slightly more likely than other generations and the general population to name investing in real estate as most crucial for building wealth. They’re also the generation most likely to actually be doing it. 

Overall, just 22% of respondents say they currently own a home, but that jumps to 37% of baby boomers, according to LendingTree. Only 14% of all consumers surveyed report investing in real estate outside of their primary residence.

The data seems to show an interesting contradiction: Americans think real estate is the key to building wealth, but the fact of owning property itself isn’t what makes people consider themselves wealthy.

When it comes to what actually makes you wealthy, Americans tend to agree that it’s more of a feeling than a certain asset. Over half — 56% — of survey respondents say being able to live comfortably without financial concerns is what defines wealth. Another 45% say financial security is what wealth is all about.

Just 33% say owning a home makes you wealthy and only 14% say owning real estate outside of your primary residence does the trick.

When asked to put a number to it, nearly 1 in 3 Americans say you have to make at least $100,000 a year to be considered wealthy, the LendingTree survey found.

What’s more, among those currently earning $100,00 a year or more, 31% say you need to make at least five times that to be considered wealthy.

Though just 41% of Americans think they’ll ever be wealthy, younger people are significantly more optimistic. Nearly 70% of Gen Z and 54% of millennials believe they will be wealthy in their lifetimes. 

Additionally, the younger generations are slightly more likely than their older peers to have faith in the stock market. While 38% of Gen Z and 37% of millennials say the stock market is the best route to wealth, only 30% of Gen X and 24% of baby boomers do. 

Younger people possibly understand they have more time than their elders to see market returns, Matt Schulz, chief credit analyst at LendingTree, tells CNBC Make It. “That’s a big, big deal.”

“There is no greater wealth-building asset than time,” he says. “While younger Americans may not have the income or the financial experience that older Americans do, they have the distinct advantage of having many more years in which their investments and savings can grow.”

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