Millionaires Don't Know When to Quit

Enough never seems to be enough for U.S. millionaires, according to a new report from UBS. Many wealthy investors keep working long after they need because of the continual shift in objectives and the need to maintain financial security.

Millionaires continue to strive for more, even though 52% feel like they are stuck on a treadmill and unable to slow down, according to the latest UBS Investor Watch. The quarterly report is generated through a survey conducted in March with 2,215 U.S. investors who have over $1 million in net worth.

Although 75% of millionaires feel like they’ve made it, the goalposts keep shifting. About 58% said their expectations for their standard of living have increased within the past 10 years.

“The majority of millionaires say they have worked hard to earn their wealth and appreciate the lifestyle it affords them and their families. But enough never seems to be enough,” said Paula Polito, client strategy officer at UBS Wealth Management Americas.

Interestingly, many millionaires still relate more to the middle class than the proverbial 1%. That may be because 42% of millionaire investors grew up as part of the middle class, while 35% grew up as part of working class families or poverty.

Only 10% of millionaires self-identify as upper class, despite Pew Research Center released in December research showing the median wealth among upper-income families came to $639,400 as of 2013.  Pew’s research found that the median wealth of middle-income families was about $96,500.

The shifting goalposts also mean that millionaires are less than totally confident in their ability to withstand setbacks. Less than half of investors with $1 to $5 million feel completely secure. About a third of investors with more than $5 million still felt that they didn’t have enough to withstand a setback.

Investors still working with children at home are even less confident. About 63% of those with families, who have between $1 to $5 million in assets still feel one wrong move would have a major impact on their lifestyle.

“If I could get down to part-time that would be nice. But I would lose a big chunk of my paycheck. It wouldn’t be feasible. I want my kids to go to the best colleges possible,” according to a 42-year-old female investor surveyed with between $1 and $2 million in assets.

Millionaires Don't Know When to Quit

1% of Americans Are Worth $1 Million

3.1 million Americans own investable assets worth at least $1 million (not counting the value of their primary residence).

The population of the USA is 312 million today.

Therefore, roughly 1% of Americans have a net worth of $1 million.

Source: Merrill Lynch Cap Gemini World Wealth Report, Census Bureau

A Millionaire Boom Is Coming...

Despite the Great Recession, which wiped out $15.5 trillion in household wealth in the United States alone, the number of millionaires in this country and abroad will grow rapidly over the next decade.

In the U.S., the total number of families with a net worth of over $1 million, including real estate, will double by 2020, according to a report by the Deloitte Center for Financial Services.

Overall, the U.S. and Europe have the greatest concentrations of wealth than any other region, although emerging markets are narrowing the gap.

China will lead the way in millionaire growth, the report said, followed by Brazil and Russia. By 2020, China and South Korea will rank in the top 10 of countries with the greatest total number of families worth more than a million dollars.
"There is going to be very fast growth, but it will take a lot longer to reach anything like the wealth in the developed world," said Andrew Freeman, lead author of the report.

With 10.5 million, the U.S. has -- by far -- the greatest number of millionaire households in the world, despite the financial crisis and ensuing recession which knocked more than 3 million millionaire families off the map between 2006 and 2008.

The number of millionaire households is expected to return to pre-crisis levels by 2015 and reach 20.6 million in 2020, maintaining the U.S.'s position in the top spot. By then, 43% of the world's wealth held by millionaire households will be in the U.S., up slightly from 42% this year, the report said.

Japan is expected to rank a distant 2nd, with 8.6 million millionaire households in 2020 and 9% of the world's wealth. China is expected to be No. 7, with 2.5 million millionaire households in 2020 and 4% of the world's wealth.