How much money you need to be in the wealthiest 10% of Americans

Despite the short-term recession caused by the pandemic, high inflation and rising borrowing costs since 2020, the rich have become significantly richer.

According to a recent study, the threshold for being among the top 10% of U.S. households in terms of net worth has increased from about $1.3 million to roughly $1.8 million over the past five years, largely due to rising stock and home values. Visa analysis 2024 U.S. Census Bureau survey data. This figure reflects the value of what a household owns (homes, vehicles, savings, retirement accounts, investments and other assets), net of debt.

In absolute terms, the wealth of households currently in the top 10% of net worth has increased more than any other generation in the past five years, according to the Federal Reserve report. distribution of wealth data.

Visa’s analysis shows that the income required to rank in the top 10% has also increased, rising from about $170,000 to roughly $210,000 over the same period. For comparison, the US median income is $83,730 as of 2024. According to US Census Bureau data.

Visa defines “affluent” households as those who either earn at least $210,000 or have a net worth of about $1.8 million; this puts them above 90% of U.S. households.

The analysis shows that approximately 12.2 million households in the U.S. fall under this definition, with Gen Xers making up 57% and Boomers making up 12%. Millennials and Generation Z together make up the remaining 31%.

Considering that many generations are retired and in their peak earnings years, it may not be surprising that Generation X leads the affluent group.

The last five years have been unusually good for households that already own a home or have money in the market. Despite the Covid-19 pandemic and the rise in inflation, the job market remained strong and consumers continued to spend. kept the economy on solid foundations.

House prices have increased since 2020 tight supply and cheaper mortgage rates remain close historic lows Until the Federal Reserve raises its benchmark interest rate in 2022, the first increase since December 2018.

Major stock indexes also rebounded quickly after the crash in early 2020 and continued to reach new highs. big federal stimulus and a rapid economic recovery, as measured relative to gross domestic product.

These trends increased wealth much faster than incomes. Paychecks have increased, but at roughly half the pace. Between 2020 and 2024, the threshold for the top 10% of net worth increased by nearly 40%, while the threshold for income increased by approximately 23%, according to Visa’s analysis.

Broader indicators tell the same story: The median home price in the US has risen nearly 25% in the past five years, According to US Census dataand the S&P 500 gained roughly 109%.

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