When a million's not enough

By THIS IS MONEY
Updated: 06:09 EST, 18 October 2005

A MILLION pounds is not worth what it used to be, with people now needing nearly £3m to lead a millionaire's lifestyle, research claimed today.

Private bank Coutts & Co said the value of £1m had eroded so much over the past 25 years that the term millionaire was now less meaningful than it once was.

Instead it said people would need nearly £2.6m to fund a lifestyle that included a luxury five-bedroom house with two staff, two luxury cars, an apartment and yacht in the South of France and enough money to dine out twice a week and take two luxury holidays a year.

It said it was time to coin a new phrase 'thrillionaire' to reflect the fact that people now needed nearly £3m to finance a this kind of lifestyle.

Rising property prices are the main reason why £1 million no longer stretches as far as it used to, with the cost of a home jumping by more than 575% during the past 25 years.

Sarah Deaves, chief executive of Coutts, said: 'A millionaire used to be someone who was seen as super-wealthy, a person who didn't have to work if they chose not to, and who was able to live a life of luxury simply by having £1m in cash or assets.

'One million pounds is obviously still a sizeable amount of money, which, if invested correctly, can afford a high standard of living and provide financial security in later life.

'However, while 25 years ago £1m would have been more than enough to comfortably live the millionaire's lifestyle a few times over, today it will only afford a small portion of the trappings.'

But despite this the group found that 65% of people still said they would give up their job immediately if they won £1m.

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The group found that the number of millionaires in the UK had soared by more than 80% between 2001 and 2004 to reach 425,000, largely due to a 64% jump in house prices during the period, and just over half of those questioned think they might become millionaires during their lifetime.

People living in London would need the most cash to support a millionaire's lifestyle at £3.47m, although in 1980 they would have needed just £451,000 to support the same lifestyle.

The cheapest region to live a luxury lifestyle in is Wales at £2.2m.