With daily headlines about buying yachts, attempting space travel, and dodging taxes, billionaires like Jeff Bezos and Elon Musk have become synonymous with wealth—and wealth creation. But it takes far, far less to be counted among the richest of the rich in the U.S. In fact, a few million will do.
That’s according to the 18th edition of the Wealth Report from Douglas Elliman and real estate agency and consultancy group Knight Frank, which looks at wealth distribution around the globe and offers advice to high-net-worth (HNW) and ultra-high-net-worth (UHNW) individuals, defined by the report as those with at least $1 million and $30 million, respectively.
To break into the hallowed 1%, an American needs $5.8 million, up from last year’s $5.1 million (inflation comes for us all). That places the U.S. fourth globally in terms of assets needed to break ahead of 99% of the population. It’s worth noting that other estimates put the average wealth of the 1% much higher, though it’s calculated differently.
The toughest country to join the ranks of the richest? Monaco, where it takes $12.9 million, or more than double what’s required in America. Luxembourg and Switzerland also outpace the U.S., with $10.83 million and $8.5 million needed, respectively, to crack the top 1%.
Each year, Knight Frank's report looks at where the world's richest live and how they spend and invest their money. It also provides insight from hundreds of wealth advisors and bankers on investment opportunities and challenges.
'The richest generation in history'
Last year, rising interest rates and other geopolitical factors led to the total wealth held by the richest households falling by 10%, Knight Frank found. That led to the number of global UHNW individuals shrinking by 4%.
But things are looking up this year for the 1% of the 1%. Portfolios have recovered, and the number of UHNW individuals globally rose 4.2%, to 626,619. The Middle East and the U.S. saw the biggest gains, primarily driven by the strong U.S. economy and recovering equity markets, the report notes.
And 2022 was something of an anomaly, as far as wealth trends are concerned: The decline came after a record year in 2021, when the population of the ultrawealthy grew by more than 9%, according to Knight Frank.
As they amass ever more money, the face of the world's wealthiest is also on the precipice of major change: The coming Great Wealth Transfer will see some $90 trillion in assets change hands over the next two decades in the U.S. alone, meaning affluent millennials will become "the richest generation in history."
Younger individuals, and more women, counting themselves among the wealthiest may create a "seismic shift" in how wealth is used. For example, far more younger affluents are worried about climate change, and view their wealth as a tool for change.
"Gen Z in particular are looking for ways to invest in alignment with their values," Mike Pickett, director of U.K. wealth management firm Cazenove Capital, says in the report. "It’s not just about financial returns, it’s about building cultural capital."