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New studies have found that there are now more Americans becoming millionaires — by a huge margin — than ever before.
The Big Account: Thanks to soaring home valuations and regular investment in index funds, the average American has been on a rocket ship of wealth, at least on paper. That means there are plenty of Americans who are millionaires but still live cash-poor. And for younger people who’ve been boxed out of owning property, that seven-figure identity may seem nearly impossible to get.
Behind the Wealth: America is the land of the millionaires — no other country in the world has as many.
- A report by Swiss bank UBS found that about one-tenth of American adults now have a seven-figure net worth, with 1,000 being added to the ranks daily last year.
- Investment banking firm UBS estimates that the number of American millionaires comes out to 23.8 million — 15x more than there were 30 years ago (1.6 million, per the IRS).
- The number of millionaires coincides with a widening income gap in the US — the Federal Reserve found that the wealthiest 10% of Americans hold two-thirds of all household wealth.
- Meanwhile, the bottom 50% of Americans hold only 3% of household wealth, with an average net worth of $60,000.
Final Investment: Unfortunately, being a millionaire (like just having a million dollars, not many millions) isn’t what it used to be. Michael Ashley Schulman, chief investment officer at Running Point Capital Advisors, called it “the new mass-affluent middleweight class.” That’s because “it takes twice as much cash today to match the buying power of 30 years ago,” per Fast Company. According to the US Bureau of Labor Statistics, $1 million in 1995 would be worth $2.1 million today — a big difference.
Projection: While the FIRE movement has taken off among millennials and Gen Zers, it’s most likely too intense for most people. Instead, expect younger Americans to chase homeownership as a primary path to wealth — even if it means renting out the place and living elsewhere.
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