Being a millionaire isn’t what it used to be. This isn’t a lament, it’s a fact: As Bloomberg News reported last week, almost one-fifth of US households have a net worth of more than $1 million. Fully one-third of them have gained that status since 2017.
There is, however, an important caveat to this data, which is through 2023: Most of that wealth is on paper. America may be entering the Era of the Illiquid Millionaire. Compared to the alternative — the illiquid non-millionaire — it is a nice problem to have. But it also is redefining what it means to be rich, with profound implications for both society and public policy.
Americans’ wealth is the result in part of a soaring stock market (up more than sevenfold from the bottom in 2009) and increasing real estate values (up 125% since 2009). Many Americans benefited from these markets because of deliberate policy choices that encouraged investment in them. In 1989, only 32% of Americans owned any equity; by 2022, about 60% did.
Continue reading the entire piece here at Bloomberg Opinion
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Allison Schrager is a senior fellow at the Manhattan Institute and a contributing editor of City Journal.
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