Who wants to be a millionaire? 1 in 10 Americans already is but the status loses its lustre

National Post

5 days ago

NEW YORK (AP) — As a child, Heidi Barley watched her family pay for groceries with food stamps. As a college student, she dropped out because she couldn't afford tuition. In her twenties, already scraping by, she was forced to take a pay cut that shrunk her salary to just $34,000 a year.
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But this summer, the 41-year-old hit a milestone that long felt out of reach: She became a millionaire.
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A surging number of everyday Americans now boast a seven-figure net worth once the domain of celebrities and CEOs. But as the ranks of millionaires grow fatter, the significance of the status is shifting alongside perceptions of what it takes to be truly rich.
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'Millionaire used to sound like Rich Uncle Pennybags in a top hat,' says Michael Ashley Schulman, chief investment officer at Running Point Capital Advisors, a wealth management firm in El Segundo, California. 'It's no longer a backstage pass to palatial estates and caviar bumps. It's the new mass-affluent middleweight class, financially secure but two zeros short of private-jet territory.'
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Inflation, ballooning home values and a decades-long push into stock markets by average investors have lifted millions into millionairehood. A June report from Swiss bank UBS found about one-tenth of American adults are members of the seven-digit club, with 1,000 freshly minted millionaires added daily last year.
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Thirty years ago, the IRS counted 1.6 million Americans with a net worth of $1 million or more. UBS — using data from the United Nations, World Bank, International Monetary Fund and central banks of countries around the globe — put the number at 23.8 million in the U.S. last year, a nearly 15-fold increase.
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The expanding ranks of millionaires come as the gulf between rich and poor widens. The richest 10% of Americans hold two-thirds of household wealth, according to the Federal Reserve, averaging $8.1 million each. The bottom 50% hold 3% of wealth, with an average of just $60,000 to their names.
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Federal Reserve data also shows there are differences by race. Asian people outpace white people in the U.S. in median wealth, while Black and Hispanic people trail in their net worth.
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Barley was working as a journalist when her newspaper ended its pension program and she got a lump-sum payout of about $5,000. A colleague convinced her to invest it in a retirement account, and ever since, she's stashed away whatever she could. The investments dipped at first during the Great Recession but eventually started growing. In time, she came to find catharsis in amassing savings, going home and checking her account balances when she had a tough day at work.