Investor's Business Daily - Want To Be A Millionaire? Here's Some Encouraging News - Paul Katzeff - April 30, 2018
Millionaire U.S. households — households with net worth of $1 million or more, not including primary residence — grew by 686,000 in 2017 to 11.5 million, according to the annual millionaire household head count by Spectrem Group.
That should be encouragement for hardworking people who want to join the ranks of the rich.
The 2017 jump in the number of millionaires in the U.S. was the largest increase since the 2009 financial crisis bounce-back year, when the ranks of millionaire households soared by 1.03 million.
The 2017 change was a 6.34% increase. That was the biggest percentage change since 2013's increase of 605,000 households, which amounted to a 6.69% gain. In 2009, the 1.03 million increase translated into a whopping 15.32% jump.
Which Millionaire Households Grew The Most
Spectrem divides rich households into three categories. At the low end (relatively speaking) are "millionaire" households, which have a net worth of $1 million to just under $5 million.
In the middle are ultra high net worth (UHNW) households, whose net worth ranges from $5 million to under $25 million. The wealthiest are the "$25 million plus," whose net worth is at least $25 million.
Growth was greatest in percentage terms at the high end. The ranks of "$25 million plus" households jumped 10.26%. UHNW households grew 7.14%, and "millionaire" households climbed 6.17%.
Mass affluent households, whose net worth ranges from $100,000 to just under $1 million, grew only 1.64%, although their raw numbers of 31 million in 2017 were the largest.
Millionaire households grew by 580,000 to 9.98 million in 2017. UHNW households grew by 90,000 to 1.35 million, and "$25 million plus" households grew by 16,000 to 172,000.
Why The Richest Grew Richer
The long bull market is the main reason for growth in the ranks of millionaire households. "We had an excellent year in 2017 and in other years, when the market was up," said Tom Wynn, Spectrem's director of affluent research. "The main reason the millionaire numbers are up is because people's investments rose in value."
Stock market gains are why the richest households — those with net worth of $25 million and up — grew the most in 2017.
"The richest households put more of their wealth to work in the stock market," Wynn said. "So they've benefited from the bull market."
Inheritances by baby boomers also play a role, Wynn says, but a much smaller one.
The biggest personal concerns of millionaires — heads of millionaire households, to be precise — include maintaining their current financial status, health of their spouse, their own health and the possibility of a family health catastrophe.