A millionaire member

Here are some interesting stats regarding millionaires in the US.

https://www.ramseysolutions.com/retirement/how-many-millionaires-actually-inherited-their-wealth

We recently released the findings of the largest study of millionaires ever conducted, with 10,000 people participating. We also surveyed the general population, and we found out that 74% of millennials believe millionaires inherited their money. So do 52% of Baby Boomers.

Our study of millionaires blows that theory out of the water. Only 21% of millionaires received any inheritance at all. Just 16% inherited more than $100,000. And get this: Only 3% received an inheritance at or above $1 million!

Think about that: 74% of millennials believe millionaires inherited their money, but the vast majority of millionaires didn’t get any inheritance at all—and those who did certainly didn’t get enough to make them millionaires!

Still need to define what a millionaire is.

Greenhorn wrote:

Here are some interesting stats regarding millionaires in the US.

More food for thought:

Nearly 70% of millionaires are worried about leaving ‘too much’ money to their kids, survey finds

Published Sun, Sep 19 20219:00 AM EDT
Nicolas Vega

Wealthy celebrities like Daniel Craig and entrepreneurs like Warren Buffett and Kevin O’Leary aren’t the only ones concerned about leaving too much money to their children: Millionaires are increasingly worried about how much of their fortunes to give to their kids.

That’s according to a survey conducted by The Motley Fool, which asked 2,000 high net worth individuals — classified as people with a net worth over $1 million — about their attitudes toward inheritances.

Among the top concerns the individuals surveyed had was the possibility of leaving too much money for their heirs, something that 67% of respondents mentioned.

The respondents had numerous concerns about the effects of leaving too much money to their heirs, including that the wealth would be “used irresponsibly” or that it “would cause beneficiaries to be lazy.”

“What’s clear is that high net worth individuals are concerned about the effects of leaving too large an inheritance,” Motley Fool research analyst Jack Caporal tells CNBC Make It. “They are aware of and actively considering leaving inheritances with conditions that incentivize their heirs to pick up on values that they think are important, such as hard work, doing well in school and finding a good career track.”

The survey found that 85% of high net worth individuals who had to meet certain conditions to receive their own inheritance agree that it is possible to leave too much money to an heir. Among respondents who received an inheritance worth between $500,000 and $1 million, 84% agreed.

“The results and their responses were definitely guided by their own experiences, which is interesting because you get a sense from them that these were not unfounded concerns, but that they relate to their own experiences having inherited a lot of wealth,” Caporal says.

However, only 78.5% of those who received inheritances between $100,000 and $500,000 agreed and 69% of those who received less than $100,000 did.

But despite their concerns over what size inheritance they should leave, 60% of survey respondents said they found it “very important” to leave an inheritance and roughly 34% said they planned to leave over 50% of their assets to their heirs.

biggill wrote:

Still need to define what a millionaire is.

Having a million or more locked up in a 401k would not count in my eyes. You are going to lose a substantial amount to taxes. And the government can change those tax rules whenever they want.

Cash in the bank. Liquid assets.

-J.

I guess the thought of passing off my land, money, and assets to anyone/thing else besides my family has never crossed my mind.

I’ve got 99 problems …being rich ain’t one.

Jon Jordan wrote:

Cash in the bank. Liquid assets.

If that’s the definition, then I probably don’t know any millionaires, or maybe only a handful. Assets less liabilities (a future tax bill is a liability in my eyes) is how I would define it.

Deuces wrote:

I’ve got 99 problems …being rich ain’t one.

Now that’s funny right there.

BigWerm wrote:

Assets less liabilities (a future tax bill is a liability in my eyes) is how I would define it.

You can go out this afternoon and buy a term life insurance policy for $1m. Probably will cost less that $200 for the first month. Boom, you have a $1m asset.

Not going to help much if you have to come up with $1m in cash by Friday.

It’s all how you want to look at it I guess.

-J.

Jon Jordan wrote:

<div class=”d4p-bbt-quote-title”>Matt Wodziak wrote:</div>
Still need to define what a millionaire is.

Having a million or more locked up in a 401k would not count in my eyes. You are going to lose a substantial amount to taxes. And the government can change those tax rules whenever they want.

Cash in the bank. Liquid assets.

-J.

Not necessarily so. It depends on how it got deposited.

Your net worth is assets minus debts. Claiming retirement accounts, property, investments etc. don’t count is a real head scratcher considering that’s how you build wealth in the first place. Unless you are extremely wealthy, no smart investor just has millions sitting in cash in a bank as some of you claim you need, your just losing money to inflation doing that.

Jon Jordan wrote:

<div class=”d4p-bbt-quote-title”>BigWerm wrote:</div>
Assets less liabilities (a future tax bill is a liability in my eyes) is how I would define it.

You can go out this afternoon and buy a term life insurance policy for $1m. Probably will cost less that $200 for the first month. Boom, you have a $1m asset.

Not going to help much if you have to come up with $1m in cash by Friday.

It’s all how you want to look at it I guess.

-J.

That’s a less than $200/mo liability to you, and maybe (if you die during the term) a $1M asset to your beneficiary. An asset is something you tangibly have and could turn into cash in a relatively short period of time. And if anyone wants Life insurance, give me a call!

The only millionaires dumb enough to have that much cash liquid are in the NFL

bfishn wrote:

no smart investor just has millions sitting in cash in a bank

Do a search on what percentage Warren Buffett currently has sitting in cash. (I consider him a “smart investor”)

And just to clarify, when I said liquid assets, that includes stocks, bonds, gold, ect. Anything you own that you can sell for cash in a reasonable amount of time. Like less than a week.

-J.

Jon Jordan wrote:

<div class=”d4p-bbt-quote-title”>bfishn wrote:</div>
no smart investor just has millions sitting in cash in a bank

Do a search on what percentage Warren Buffett currently has sitting in cash. (I consider him a “smart investor”)

Nice how you conveniently left out the beginning of my quote “unless you are extremely wealthy” which would apply to Buffett. You would make a good CNN employee, I hear they are hiring.

I do not to brag, but I am broke LOL

bigcrappie wrote:

I do not to brag, but I am broke LOL

If there are any IDO Ms.Millionaires on here I’d be happy to send out my resume for a sugar mamma. Pics included of all assets

If I have $1M+ cash in the bank, but owe $800k on my house, I’m still a millionaire correct? Not seeing the logic in the cash on hand argument.

Millionaire = Net worth is greater than or equal to $1mil.

When and if the IRS adds 87000 more agents and analyzes your transactions cash will surly become KING.
There would be no value in running it to the bank for the Government to oversee while you make pennies in interest.

Joe Jarl wrote:

Not seeing the logic in the cash on hand argument.

Guys are missing the point I was trying to make.

Simple definition of Net worth = assets – liabilities.

Many sit there looking that their 401k balance at $1m + thinking “Cool, I got a million for retirement. I’m a millionaire” Not a true asset. If you had to cash it in today you would lose half to taxes and penalties. That’s why I’m careful how those funds are looked at.

When I say cash in the bank, liquid assets I’m referring to assets where taxes and liabilities are $0.00. Have a million in assets like that, you are a millionaire.

I’ve been looking at how people and businesses make themselves look “Rich” on paper for a better part of 35 years. Most don’t have $10 in their wallet for lunch if they had to cash out and retire…..”a millionaire”.

-J.

Being rich doesn’t make you happy but it makes being unhappy a whole lot easier.

buck-slayer wrote:

Being rich doesn’t make you happy but it makes being unhappy a whole lot easier.

Marry for money. You can always buy happiness…
DT

Jon Jordan wrote:

Having a million or more locked up in a 401k would not count in my eyes. You are going to lose a substantial amount to taxes. And the government can change those tax rules whenever they want.

Jon Jordan wrote:

And just to clarify, when I said liquid assets, that includes stocks, bonds, gold, ect. Anything you own that you can sell for cash in a reasonable amount of time. Like less than a week.

These contradict each other. Why would a 401k NOT count because the owner will be taxed on the income at some point, but stocks, bonds, gold, etc count. All of these will be subject to capital gains taxes and they would also be bought with post-tax money, so essentially they have been taxed twice.

I think you will find very few millionaires who leave their money sitting in savings account essentially losing value. If you have what it takes to make it in the first place, you probably are smarter than this when it comes to keeping and growing your money.

Greenhorn wrote:

Millionaire = Net worth is greater than or equal to $1mil.

This ^^^.

To the point about inheriting money, we are just at the beginning of a big change in this area. The first generation that benefitted broadly from tax-sheltered retirement plans (as opposed to traditional lifetime pension payments) is starting to pass away and with it we will see many more people inherit large sums as these retirement accounts are inherited.

401k plans alone hold over $7 trillion dollars and estimates are that there is over $40 trillion dollars saved by Americans for retirement.

In the past, pension plans ended at the death of the individual and/or spouse, so little or nothing was passed down as an inheritance. Now we are just starting to see the tip of the iceberg as far money beginning to be passed down as the first generation who made wide use of the 401k, IRA, Roth, etc begins to pass away and pass on the money.

I’m hiring DT as my next financial advisor

Millionaire = Net worth is greater than or equal to $1mil

Correct.

TheFamousGrouse wrote:

In the past, pension plans ended at the death of the individual and/or spouse, so little or nothing was passed down as an inheritance. Now we are just starting to see the tip of the iceberg as far money beginning to be passed down as the first generation who made wide use of the 401k, IRA, Roth, etc begins to pass away and pass on the money.

That’s an interesting point that I hadn’t thought about. I wonder how this will affect things like inflation. You hear of how single income families were able to live relatively comfortably 30+ years ago and how everything has been inflated nowadays with both mom and dad working to the point where it is very tough to only live off one paycheck. Will we be in a similar situation in 30+ years where it is tough living WITHOUT an inheritance? Food for thought.

I don’t like to brag but I have a couple of dozen of these laying around which makes me a quadrillionaire.

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To a banker or any financial person, your worth would include your 401, pension value at this time if any, vehicle paid off value, home equity value, savings and checking cash, stocks and or investments, and for alot of us our vacation places equity value. There might be somewhat of a deduction on your 401 values to take in account for taxes, but that would be it. You may not be able to get at a 401, or pension yet, but it still has a current value that is part of your assets. From reading some of these replies on how you can’t include your house, 401, or pension present equity values, tells me that some have looked at where they stand financially, and are having a hard time accepting it that they are one of them.

Greenhorn wrote:

That’s an interesting point that I hadn’t thought about. I wonder how this will affect things like inflation.

It’s important to note that wages/income are part of the inflation equation as well. It’s not just prices that rise, so do wages.

I don’t think the passing on of wealth will drive inflation because the money already exists, it just is now owned by a different person who may or may not spend it just like the previous owner.

Also, I can see the day coming soon when the US government will be unable to resist getting more taxes sooner out of these trillions of tax-deferred dollars held in retirement accounts.

At some point, it is highly likely that the mandatory minimum distribution age will be lowered and/or the percentage of the MMD increased to, essentially, push the account owner into taking more income and therefore paying more taxes and most likely at a higher tax rate.

We’ve already seen it with the recent outlawing of back door Roth IRA conversion. The next target will be 401k accounts.