According to a new survey from Phoenix Marketing International’s Affluent Market Practice, the number of American households with investible assets of $1 million or more rose 8% in the 12 months ended in June. The survey says there now are 5.55 million U.S. households with investible assets of $1 million or more:
Despite enormous volatility in the economy and stock markets, the broad affluent market in the U.S. has managed to register small gains in numbers over the past three years, and now number nearly 25 million households. As the Total Affluent market is defined in part by income, it is likely that income growth at the higher end of the spectrum, rather than portfolio growth, has been the key factor in the continued increase in this market. Phoenix defines Total Affluent as $250,000 or more in investable, or liquid assets, or $150,000+ in household income. Current gains in the number of affluent households can be largely attributed to income growth. Investors with $150k+ in income saw an average of a seven percent gain in numbers from 2008-09 and from 2009-10 In contrast, when measured by investable assets only, the size of the market declined by one percent from 2008-09 and grew only two percent from 2009-10. Income gains, coupled with households that have fallen out of the Mass Affluent segment, have also contributed to steady gains in the number of Emerging Affluent. Gaining seven percent in numbers over the past two yearly tracking period, Emerging Affluent now number 3.3 million U.S. households. While they have the income to potentially grow into higher wealth categories, many Emerging Affluent are saddled with enormous levels of debt, and cash flow needs constrain their ability to invest. After downsizing in number through the market turmoil of mid-year 2007 to mid-year 2009, Wealth Market households rebounded at mid-year 2010. Recording an eight percent growth rate from 2009 to 2010 from the strength of increases in the equity markets, Wealth households now number nearly 5.6 million in the U.S.