Where the Millionaires Are

Look to the states won by Hillary Clinton in the 2016 presidential election.

Proportion of “millionaire households” by state (darker shades equals higher proportion of millionaires).

Over the past few years, we’ve heard a good deal about income inequality in the United States. One persistent narrative is that the wealthiest and highest-income households continue to do well – and indeed are improving their relative standing – while many other families struggle financially.

The most recent statistical reporting seems to bears this out.

According to the annual Wealth & Affluent Monitor released by research and insights firm Phoenix Marketing International, the total tally of U.S. millionaire households is up more than 800,000 over the past years.

And if we go back to 2006, before the financial crisis and subsequent Great Recession, the number of millionaire households has increased by ~1.3 million since that time.

[For purposes of the Phoenix report, “millionaire households” are defined as those that have $1 million or more in investable assets. Collectively, these households possess approximately $20 billion in liquid wealth, which is nearly 60% of the entire liquid wealth in America.]

Even with a growing tally, so-called “millionaire households” still represent around 5% of all U.S. households, or approximately 6.8 million in total. That percentage is nearly flat (up only slightly to 5.1% from 4.8% in 2006).

Tellingly, there is a direct correlation between the states with the largest proportion of millionaire households and how those states voted in the most recent presidential election. Every one of the top millionaire states is located on the east or west coasts – and all but one of them was won by Hillary Clinton:

  • #1  Maryland
  • #2  Connecticut
  • #3  New Jersey
  • #4  Hawaii
  • #5  Alaska
  • #6  Massachusetts
  • #7  New Hampshire
  • #8  Virginia
  • #9  DC
  • #10  Delaware

Looking at the geographic makeup of the states with the highest share of millionaires helps explain how “elitist” political arguments had a degree resonance in the 2016 campaign that may have surprised some observers.

Nearly half of the jurisdictions Hillary Clinton won are part of the “Top 10” millionaire grouping, whereas just one of Donald Trump’s states can be found there.

But it’s when we look at the tiers below the “millionaire households” category that things come into even greater focus. The Phoenix report shows that “near-affluent” households in the United States – the approximately 14 million households having investable assets ranging from $100,000 to $250,000 – actually saw their total investable assets decline in the past year.

“Affluent” households, which occupy the space in between the “near-affluents” and the “millionaires,” have been essentially treading water. So it’s quite clear that things are not only stratified, but also aren’t improving, either.

The reality is that the concentration of wealth continues to deepen, as the Top 1% wealthiest U.S. households possess nearly one quarter of the total liquid wealth.

In stark contrast, the ~70% of non-affluent households own less than 10% of the country’s liquid wealth.

Simply put, the past decade hasn’t been kind to the majority of Americans’ family finances. In my view, that dynamic alone explains more of 2016’s political repercussions than any other single factor.  It’s hardly monolithic, but often “elitism” and “status quo” go hand-in-hand. In 2016 they were lashed together; one candidate was perceived as both “elitist” and “status quo,” and the result was almost preordained.

The most recent Wealth & Affluent Monitor from Phoenix Marketing International can be downloaded here.

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