The Rise of the Middle Class Millionaire
I am interested in comments on this article from Market Watch. Text in bold is my emphasis.
Those with a net worth of between $1 million and $10 million -- that they have earned rather than inherited -- are being dubbed "middle-class millionaires," a group that has grown on the heels of the economic boom over the past couple decades.
Middle-class millionaires now account for 10% of the U.S. population, according Russ Alan Prince and Lewis Schiff, who coined the term for research purposes and a new book by that name. They studied almost 4,000 households to better understand attitudes, values and purchasing patterns.
Their findings include:
7.6% of American households, or 8.4 million households are middle-class millionaires
The average middle-class millionaire works 70 hours per week
Middle-class millionaires are five times more likely than the average worker to say they are always available for work
89% believes that anyone can attain wealth through hard work
62% believes that networking, or knowing many people, is the key to financial success
Nine out of 10 middle-class millionaires say they made a bad career or business move, but almost three-fourths say that was crucial to their business success
They are five times more likely than the average middle-class person to continue on in the same business course in spite an earlier failure
65% of middle-class millionaires characterize their approach to negotiating as "doing whatever you need to do to win"
They say they need a net worth of $24 million to feel wealthy, and $13.4 million to be considered rich.
Prince and Schiff also found that almost half of middle-class millionaires believe a child's academic achievements reflect one's success as a parent. Seventy-five percent of this group chose their home because of its school system. And only 14% of them trust the government.
This separates middle-class millionaires from the middle class in general: Only 16% of middle-class households were ready to put their own reputation on the lines when it comes to their kids' academic record, according to Prince and Schiff. More than half of middle-class households chose their homes because it was close to work. And an almost equal amount believes the government has their back, Prince and Schiff say.
The differences may be stark, but Prince and Schiff see that changing. They describe middle-class millionaires as "the rise of the new rich and how they are changing America." The changes they see are evident in four areas: hard work, networking, persistence and financial self-interest.
These traits may differ from those in the middle class but their offspring, in the form of goods and services, are making their way "downstream."
"From life coaches to luxury vacation rentals, concierge medical care to high dollar prep course into the Ivy League [these things] are making their way downstream, steadily becoming available to a much broader population," Prince and Schiff say. "What was once the province of only the super rich is now being created and packaged for the 'downline' population or for those with fewer zeros in their net worth, but similar aspirations."
Collectively, the authors say, middle-class millionaires are influencing, advocating and reshaping the social, cultural and commercial landscape of our world.
It's a whole new level of keeping up with the Joneses.
Take the OnStar navigation system. It began as an emergency road service for high-end luxury vehicles. Now it's even offered on midrange trucks. Similar trends are occurring in real estate, vacations, airline travel and other services.
We may have to begin adding some new class structures in America. Otherwise we may all soon belong to the same one.