Tuesday, January 20, 2009

Income demographics of aging baby boomers

Many a frugal baby boomer is reaching the height of their incomes (ages 40 to 60), and according to income statistics, there are 12 million American millionaires (measured as any person having over $1m in assets, not counting their primary residence).

With housing prices remaining high, I often wondered who buys these new mega-homes. In my area, a upscale home in a gated neighborhood will set you back over a million dollars:

But the distribution of millionaires by State is quite interesting, with Hawaii having twice the per-capita wealthy as West Virginia. This link has some interesting data on 2006 income levels, organized by State:

Plotted, it looks like this:

For more on the changing demographics of the aging baby boomers, see my notes on the Billionaire Next Door. So far as I know, only one of my High school classmates is a billionaire, but just about everyone who got an advanced degree has earned over a million dollars in their careers:

When studying the projected earnings from an advanced college degree, I was surprised to learn that with inflation, the majority of yuppies will become millionaires.

But how much is a college degree worth? High school graduates can expect, on average, to earn about $1.2 million dollars in lifetime income, while those with a bachelor's degree earn an average of $2.1 million over a 40 year working lifetime.

Today, only one-in-a-million Americans is a billionaire, with less then 500 USA billionaires.