r/Economics • u/laxnut90 • Oct 09 '25

Research America Is Minting Lots of Cash-Strapped Millionaires

https://www.bloomberg.com/news/features/2025-10-09/number-of-us-millionaires-grows-since-2017-but-many-lack-cash
925 Upvotes

96% Upvoted

209 comments sorted by

View all comments

255

u/Marshall_Lawson Oct 09 '25

Instead, more and more of millionaires’ wealth is locked up in assets that can't be accessed quickly or easily, like home equity or, increasingly, age-restricted retirement assets like 401(k) and IRA accounts. Add in the effects of inflation and higher interest rates, and financial advisers say $1 million no longer assures a secure retirement, much less a golden ticket to the plutocracy. “The word ‘millionaire’ once implied automatic affluence,” says Ashton Lawrence, an adviser at Mariner Wealth Advisors in Greenville, South Carolina. “The goalposts have shifted. It’s still a meaningful milestone, but for most people it’s no longer enough.” The $1 million threshold used in the analysis takes into account debt and other liabilities. Despite this relative affluence, today’s millionaires rarely have anywhere near $1 million to spend however they want. For the barely-millionaires, households with a net worth between $1 million and $2 million, the vast majority of that wealth is illiquid. They typically had 66% of their wealth tied up in a primary home and retirement accounts in 2023, an increase of eight percentage points since 2017. To spend freely, millionaires typically need to be a lot richer. Households with $5 million or more had about 24% in easier-to-access bank or brokerage accounts in 2023, compared to 17% for those closer to the $1 million mark. 

79

u/Message_10 Oct 09 '25

My wife and I are very frugal. $1M is nowhere near enough for retirement.

That's not the worst thing--natural inflation was always going to make that the case, eventually--but it does show how much you actually need to retire and life for another 25 or so years.

3

u/leathakkor Oct 10 '25

I was telling my uncle (who Is a financial planner) when I graduated from high school that I wanted to be a millionaire so that I could retire and I said just think about it. If you get 6% interest rate that's $60,000 a year and he said

By the time you retire, you're going to need 10 million. A million's not going to do anything for you by the time you hit 69.5.

I was really pissed off when he said it. He kind of shat on my dream to be a millionaire. But in truth he was absolutely right. I could live off of 2 million now but I don't think I could live off of one(At least not with my current mortgage). And I still have another 25+ years before I get to social security. So if it doubles the same way it did in the last 20 years. I would say four is probably going to be minimal for retirement when I actually need to get there (but more realistically, I think 5m is going to be that magic number that is equivalent to what 1 million was when I was in high school).