re: US Millionaires

quote:

---

Just read an article from last March stating that 12.7% of the US adult population are millionaires. Does anyone else find this number lower than you would have guessed? I would have thought easily in the mid teens to mid 20’s percentage wise. I would have thought the percentage of wealthy adults (net worth of 2.4 mill) would have been well under 10%. I’m in my early 50’s and grew up poor to lower middle class and remember being wowed when someone was referred to as a millionaire. Doesn’t take a lot of assets to be valued at over a million (home, land, retirement accts, savings accts, checking accts, mattress and sofa funds LOL, businesses etc) these days. I am sure only assets that are outright owned (no mortgage/loan/lien assets) were considered but still would have thought it would have been higher.

---

If you are talking "net" worth, then yes, the assets would be reduced by the mortgages, liens, credit card debts, etc. That is what the "net" means. Where did the $2.4 million net worth designation as "wealthy" come from? Was that in the article?

They are still millionaires are they not? Please look up the definition of a millionaire. If you have a million in cash plus a million in assets you are by definition a multi-millionaire.

What would you rather have? A million dollars in cash and a modest house or a million dollar house and very little in savings. By definition both people are millionaires, but the one with cash and a modest house has a far less stressful lifestyle. I have several colleagues who have the mansion and high dollar cars and won’t be able to ever leave their practices. Technically they are millionaires, but they are essentially living paycheck to paycheck.

quote:

---

ave several colleagues who have the mansion and high dollar cars and won’t be able to ever leave their practices.

---

My wife is a retired physician, she has several former colleagues 60 -65 years old with little to no retirement savings, large homes with multiple mortgages, and a couple of them still paying student loans.

quote:

---

I have several colleagues who have the mansion and high dollar cars and won’t be able to ever leave their practices. Technically they are millionaires, but they are essentially living paycheck to paycheck.

---

Are they really millionaires? If they’re living paycheck to paycheck, then their mortgage is through the roof and their net worth isn’t near what you think it is.

I.e. - Someone that has a $2mil home with a $1.6mil mortgage, $100k car loans, and $250k in student loans isn’t a millionaire. Their net worth, assuming they don’t have other savings, is around $50k.

Just checked. In the 99th percentile.

A few things to remember when using this website:
- based on household net worth (not individuals)
- data is outdated (2016 data), probably a large change in those numbers due to the market performance in 2019 alone
- Compare the chart to see the shape of the distribution (1% change from 98% to 99% takes a huge $ jump but going from 49% to 50% does not take a lot of $)
- this does not take into considerations cost of living advantages (I would fully expect a household in NYC, San Fran, etc. to have a higher net worth than in rural Kansas)

All that being said, I like my %.

quote:

---

It’s all about your perspective. On my street it’s mostly married, professional couples in their 30s. Dual incomes, earning probably $200/$250 on average. I would bet at least 1/2 of those have $1mm a net worth if you count home equity. That’s not the national reality though.

---

Based on my experience from once working as a bank loan officer there is little correlation between high household income and high net worth. The percentage of people that cannot manage money is just as bad at incomes of $200k as it is st $40k,

My point is it’s not crazy rich so I thought the percentage of those with a net worth of 1 mill would be higher than 12.7%, based on that. I am not in the 2.5 neighborhood but can see 2 from my house.