Dollar Troubles
Mo' money, mo' problems: More than 20 percent of Americans get rich, but they don't stay rich
It turns out that you don't have to be in the top one percent to be rich. New research suggests that 21 percent of working-age adults in the United States are rich for at least a year by the time they turn 60.
Made up mostly of older professionals, working married couples and more educated singles, this group of "new rich" includes those with a household income of $250,000 or more at some time during their working lives. That puts them, even if only temporarily, in the top two percent of earners. Even outside periods of unusual wealth, the members of this group typically hover in the $100,000-plus income range, keeping them in the top 20 percent of earners.
In terms of demographics, whites are three times more likely to reach affluence than nonwhites.
The success of this little-known group has implications for politics and policy as they may pose the biggest barrier to reducing America's income inequality. The new rich have reached the top two percent only to fall back below it in many cases. This makes this group far more fiscally conservative than other Americans, polling suggests, and less likely to support public programs that help the disadvantaged, such as food stamps or early public education.
The new rich, which make up roughly 25 million American households, are spread across the nation and mostly reside in bigger cities and their suburbs. In terms of demographics, whites are three times more likely to reach affluence than nonwhites. Additionally, the new rich typically spend only 60 percent of their before-tax income and often set the rest aside for retirement or investing.
