The new class consists of millionaires - approximately 8.4 million households, constituting about 7.6 percent of all American households - who did not inherit their money from a previous generation, still work hard at the office every week, are aggressive networkers, rank high on the persistence scale, accumulate financial savvy and can spend money freely on necessities and on some luxuries. They possess what the authors call "millionaire intelligence."
But, they caution:
the middle-class millionaires are not Bill Gates wealthy or Rockefeller cousin wealthy. Their net worth, as set by Prince and Schiff, ranges from $1 million to $10 million, including the equity in their home (and in some cases, presumably, second and third homes).
Rings true enough to us. Brings to mind the NYT piece a few months back about the insecure millionaire of the
As I say, I haven’t read the book (“not personally, no”), but I’m usually frustrated with this kind of data: the presenters almost never make clear what they are doing with “benefits”: are they including 401ks? Employer contributions to health care? Numbers liked this matter, and you don’t know what you’ve got until you know how they figure.
But just as a generalization, I’d say that wealth figures from a generation ago probably underreport, as compared with today. The reason is that I suspect the average worker had much more by way of “off the books” benefits then than now. Take pensions. In the old days, a fair number of employees had employer –sponsored, defined-benefit pensions. My take is that the value of the employer pension almost never shows up in accounting for wealth. These days the employer pension is mostly gone, to be replaced, if at all, by 401ks and such. These often don’t show up in the presentation either, but they do sometimes, certainly more often than their predecessor.
So also with health care: used to be a lot of this was covered before we ever got to the paycheck; less so now (perhaps I am just summarizing the argument of this guy)
On the other side of the equation, consider education. Thirty years ago, my students paid about 50 bucks a semester to go to this public law school. These days, it’s getting close to $20,000. For good or ill, it’s not a datum you catch in standard balance-sheet accounting.
Over the breakfast table, we indulged ourselves with a few minutes of mean-spirited gossip as to which among our nearest and dearest fit into this new category, and how well. From there, we moved on to the more depressing question of how they (we) will all feel when the great unraveling turns all our money into confetti.