It turns out 21% of working-age adults are rich for at least a year by the time they turn 60. That proportion has more than doubled since 1979, and it's an income group the AP calls America's fastest-growing, based on take-home pay. Made up largely of older professionals, working married couples, and more educated singles, the "new rich" are those with household income of $250,000 or more at some point during their working lives. That puts them, if sometimes temporarily, in the top 2% of earners. Even outside periods of unusual wealth, members of this group generally hover in the $100,000-plus income range, keeping them in the top 20% of earners.
The success of this little-known group has implications for politics and policy: They may pose the biggest barrier to reducing US income inequality. They've reached the top 2% only to fall back below it, in many cases. That makes them much more fiscally conservative than other Americans, polling suggests, and less likely to support public programs, such as food stamps or early public education, to help the disadvantaged. More defining characteristics:
- Sometimes referred to by marketers as the "mass affluent," the new rich make up roughly 25 million US households.
- Once concentrated in the old-money enclaves of the Northeast, the new rich are now spread across the country, mostly in bigger cities and their suburbs: Washington, Boston, Los Angeles, New York, San Francisco and Seattle.
- By race, whites are three times more likely to reach affluence than nonwhites.
- They typically spend just 60% of their before-tax income, often setting the rest aside for retirement or investing.