Best Places to Become a Millionaire
One manufacturing job that clearly hasn't been offshored is producing millionaires. A new survey reports that among 25 developed and emerging market countries, the United States has the highest number of households with at least $1 million in total assets. And come 2020 we're still expected to be sitting in the top slot. That said, in terms of the fastest growth rate in millionaire households, the place to be is South Korea, which is forecast to have a 233 percent increase compared to a 95 percent rise in the United States.
Where in the World Are the Millionaires?
Granted, $1 million apparently isn't the iconic signal of rich it once was, but it's not exactly chump change, either. Especially in countries where $1 million (U.S.) buys you a whole lot more than it does in say, the U.S. or Japan. It's also a nice round number that makes wealth managers take note. So to that end, the Deloitte Center for Financial Services, with an assist from Oxford Economics, took a look at total household wealth, including the value of a primary residence and business equity, to see where wealth managers should focus their marketing efforts in the coming years. All local values were converted to U.S. dollars for comparison's sake.
Here are the 2011 and projected 2020 rankings of countries with the most millionaire households:
Note: Green denotes emerging market country
Source: Deloitte Center for Financial Services
South Korea, which ranks 15th this year (520,000 millionaire households), is pegged to have the most impressive growth over the next 10 years. An estimated 1.73 million millionaire households in 2020 will push it all the way up to 9th, according to Deloitte.
The total number of millionaire households in the 25 countries is expected to grow by 72.5 percent between 2011 and 2020 among the 25 countries in the study. But in a sign that the rich do indeed keep getting richer, the total assets among those households is expected to rise by an even higher 120 percent.
In terms of total wealth, it's the large developed nations that have had decades, if not centuries, to accumulate wealth that are expected to still dominate 10 years out:
Among the millionaire households, the wealthiest per household by 2020 are expected to be in Switzerland, Singapore, and the U.S.:
While these sorts of studies are interesting -- OK, they are more fun/depressing cocktail chatter -- one shortcoming of these rankings are that they don't account for variance in the cost of living across borders. For example, Deloitte noted in its footnotes that $1 million here in the U.S. feels more like $1.8 million in China in terms of its purchasing power. (One more shortcoming of note: inflation is not part of the calculations, either.)
Breaking it Down in the United States
Looking just at the United States, Deloitte expects total assets among millionaire households to grow from $39 trillion today to $87 trillion in 2020, a not too shabby 8.3 percent annualized growth rate (not factoring in inflation).
One more table for you: here's a breakdown of the states (or district) with the largest number of millionaire households as a percentage of total population. These are the top six:
Before you get too excited about the fact that roughly 14 percent of households in Connecticut, Massachusetts, and New Jersey currently have $1 million or more in wealth, it's worth noting that these three states also have some of the highest state and local income tax rates in the country. Connecticut has the 3rd highest tax burden among all 50 states according to the Tax Foundation. Massachusetts has the 11th highest, and New Jersey has the worst tax burden of all 50 states. The fact that so many of the wealthy aren't exactly fleeing high-tax states suggests that maybe they aren't as sensitive to potentially rising rates as some in Washington insist.