I went in search of information on what it takes to be in the top 1 percent. The answer depends dramatically on where you live and whether the focus is on income or wealth.
What does it take to be in the top 1 percent in the world? Based on income, you need to make $32,400. To make the cut based on wealth, which includes everything from the equity in your home to the value of your investments, you need net worth of $770,000. Given that median household income in the United States was $55,775 in 2015, does this mean that most U.S. households are in the top 1 percent? It does. It reflects a very wealthy U.S. population of 324 million relative to a worldwide population of 7.4 billion.
In the United States, what does it take to be in the top 1 percent based on income? Nationally, a family needs an income of $389,000 to get into the top 1 percent. But the cutoff point varies considerable by state. The highest cutoff is in Connecticut, where residents need $660,000 to make it into the top 1 percent, while in Kentucky, they only need $268,000. The highest and lowest states based on cutoff points are shown below.
What is the cutoff point in the U.S. based on wealth? To be in the top 1 percent based on wealth, a household needs to have net worth of $7.9 million. But to be in the top 10 percent, the cutoff point is much lower at $942,000.
Sources: The worldwide wealth and income estimates are from Daniel Kurt, “Are You in the Top One Percent of the World?” Investopedia, July 20, 2016. The income cutoff points by state are from Estelle Sommeiller, Mark Price, and Ellis Wazeter, “Income inequality in the U.S. by state, metropolitan area, and county,” Economic Policy Institute, June 16, 2016. The wealth cutoff points for the United States are from “Nine Charts about Wealth Inequality in America,” Urban Institute Report. Available at http://apps.urban.org/features/wealth-inequality-charts
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