Here’s how much the super-rich are really worth
Many people believe that being wealthy means having a nice house, a late-model car, and a summer cottage, but the kind of money possessed by the wealthiest 1% of the world’s households dwarfs that concept. This 1% segment of the population owns large portions of major corporations, multibillion-dollar investment funds, islands in the Caribbean, and even rocket ships that take them into outer space.
The average net worth of the richest 1% of the global population’s households has mushroomed in the last decades. It now towers above the net worth of the average citizen more than ever before.
America’s Richest: A Demographic Breakdown
An individual would have to earn an annual average income of $407,500 per year to join the top 1%. A household would need a yearly income of $591,550.
Compare that to the median real earnings of all workers in the United States: $80,610 for households in 2023 (latest data available).
The wealthiest 1% are spread across many industries and come from many backgrounds. They include medical professionals, entrepreneurs, executives, and those who inherited their wealth.
The top 1% in the U.S. earned over 22% of the total adjusted gross income (AGI) in the U.S. and paid just over 40% of all federal income taxes, according to Internal Revenue Service (IRS) data.
The Widening Wealth Gap
The net worth of the top 1% of American households rose steadily through the second half of the 20th century and beyond, according to the Economic Policy Institute.
- The wealthiest 1% in the U.S. had net worths equal to about 125 times that of the average American household in 1962.
- Their net worths were about 225 times the net worth of the average household by 2009.
- The gap between the richest and the poorest in the U.S. more than doubled from 1989 to 2016.
The minimum net worth of the top 1% of households is roughly $13.7 million. The top 10% have a net worth of about $1.9 million and up.
Middle-class Americans’ wealth virtually stopped growing somewhere around the turn of the 21st century. The median income for middle-class Americans rose at an average rate of 1.2% per year from 1970 to 2000. The rate slowed to 0.3% per year from 2000 to 2018.
The wealth of the top 1% continues to outpace that of the entire middle class. The top earners hold more wealth than the middle and upper-middle classes put together.
There are various reasons for the disparity, but one important factor is outsized stock ownership among the richest Americans. The 1% own more than 50% of the equity shares in both private and public companies. Much of their wealth comes from stock prices.
This can leave them vulnerable to declines in stock prices, but they may become even richer if they take some stock gains and reinvest the money in investments catering to rich investors, such as hedge funds and private equity ventures.
Underlying Causes of the Wealth Gap
Much of the growing disparity can be traced to the steady flow of tax breaks for income, gifts, and estate taxes. These can disproportionately advantage wealthy Americans.
The first $13.99 million of an estate is exempt from taxes as of 2025. That figure is up from $13.61 million in 2024.
Internal Revenue Service. “Estate Tax.”
While the middle class benefits from this reduction in taxes, this rule predominantly helps the wealthy retain a much greater portion of their assets and pass that on to their heirs.
Criticism of the Top 1%
There has been a lot of criticism of the world’s ultra-rich, especially those living in the United States. They’ve been accused of hoarding their wealth, lobbying for tax breaks, and not contributing their fair share in taxes.
Many politicians want to impose more taxes on the wealthy. Sen. Elizabeth Warren (D-Mass.) proposed a tax on ultra-millionaires as part of her 2016 campaign to become the Democratic presidential candidate for the 2020 election. Sen. Bernie Sanders (I-Vt.), also a candidate, pushed for an estate tax hike so billionaire heirs would pay more in taxes. But ideas like this have failed to gain traction.
Then-President Joe Biden managed to get some measures through in his Inflation Reduction Act of 2022 that pursue new revenue sources from wealthy Americans. They include:
- Additional IRS funding to pursue unpaid taxes from those earning $400,000 or more
- A minimum corporate tax of 15%
- A 1% tax surcharge on stock buybacks to discourage excessive use of profits to reward shareholders and executives
How Much Income Is Necessary to Be in the Top 1%?
An individual would need an average income of $407,500 per year to join the top 1%. A household would need an average of $591,550.
What Is the Net Worth of the Top 1% of Americans?
The world’s top 1% is formed by the richest individuals. The top 1% of household net worth in the U.S. started at $13,666,778 in 2023.
What Percentage of the Population Has a Net Worth of $2 Million?
Roughly 10% of Americans have a net worth of $1.9 million or more. Compare that to the top 1% of the American population, which has a minimum net worth of almost $13.7 million per household.
The Bottom Line
Income disparity is inevitable in a capitalist society and a free-enterprise economy. However, the fact that the disparity seems to be increasing is a source of growing concern for many.
The share of the nation’s wealth in the U.S. held by the top 1% increased from 23% to nearly 32% from 1989 to 2018. The amount of wealth held by the 1% continues to grow.
