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The article has nothing whatsoever to do with the notion of coming up with $400 in hard currency on-demand.

• PeterisP 7y ago
  If a millionaire has a $400 unexpected expense, then they'd most likely pull out a credit card to pay it. Which is additional debt, and according to the article's definition it'd mean that they're "living paycheck-to-paycheck" since they'd take up additional debt for that expense. Heck, I have reasonable savings but I'd not touch them for an unexpected large expense because it's a hassle to touch any long term savings and using short-term credit for that is simpler, faster and cheaper than breaking a deposit or selling stock or whatever. It has everything to do with that notion - the definition used in this research is ridiculous; having $2000 of unused, readily available credit limit is the functional equivalent of having $2000 cash under your mattress. A $400 expense is going to reduce your net wealth/increase debt by definition, so if the answer to "what would you do for a $400 expense" is "duh, I'd borrow 400 because for me being able to borrow 400 on a short notice is simple and certain to succeed" then that's a quite reasonable answer that doesn't imply any financial problems whatsoever.
  • deleted 7y ago
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