It's hardly a national tragedy, but the number of new millionaires produced in the U.S. slowed significantly last year after years of robust growth following the dot-com bust, says a new Spectrem Group report.
The country's roster of households with $1 million or more (not including the primary residence) grew by 2% in 2007, to 9.2 million, the slowest growth rate since 2003 when it was zero. It jumped 21% in 2004, followed by 11% in 2005 and 8% in 2006.
Meanwhile, the number of ultra-high-net-worth households-those with $5 million or more (not including the primary residence)-also grew by 2% in 2007, to a high of 1.16 million. That was the lowest-percentage increase since 2002 when it was zero. The growth rate for the number of ultra-high-net-worth households had been on a tear, with increases of 26% in 2005 and 23% in 2006.
Spectrem's report, "Affluent Market Insights 2008," is based on a series of surveys of more than 3,000 affluent households, defined as those with $500,000 or more in investable assets, as well as an online survey of 2,400 millionaire households. Both were conducted in 2007.
"We had already tracked a steady decline in millionaires' investment optimism since mid-2007 on a variety of concerns including a slowing economy, rising energy costs and poor stock market conditions," says George H. Walper Jr., Spectrem Group president and co-author of the report. "It now appears those concerns have become a reality for the wealthiest tiers of the U.S. population."