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In another City-Data forum some kind person posted this Bankrate.com link which defines the income threshold needed to be part of the top 1% as $343K per year. Now that was based on the 2009 tax year, so the figure is admittedly a bit dated. Top 1 Percent: How Much Do They Earn? | Bankrate.com
However, I was amazed that the amount was that low. I would have guessed it to be several times higher than that. Apparently the 1% includes some folks at the lower end of that lofty range who are not really very rich at all. I don't know what to think about that datum.
Perhaps someone will come up with a more recent figure and/or other explanatory comments.
(And no, just to clarify, I am not anywhere close to being part of that lofty group).
As of 2012, it was $394,000 (Saez/Piketty updated stats) but I don't believe there is aggregated data to indicate what it would be as of 2013.
As to lowexpectations' comment, part of what people miss is that income means little. It's the ability for people at a certain income level to save and grow their capital assets faster than inflation. If you are making $50k as a household (usually a two earner household), you are probably taking home 40k and spending 30k or more depending on where you live. So, barring any medical issues or other unexpected expenses, you can maybe save 10k. And that's if you live modestly.
A person making 394k, even if they are only taking home 250k after all taxes, can save 200k if they live a considerably more generous lifestyle than the person making 50k. So, for 8x the pay, you can save 20x as much and still have an easier and more comfortable life on top of it.
Not only THAT, but people with more assets can risk more because of the lower marginal utility of lost income from risk. Someone saving 10k per year will likely save in more "stable" instruments with lower returns because they can't afford a single larger loss if they ever needed to dip into their savings (job loss, move, medical expenses, car problems, etc...). So the inequality diverges yet more!
As of 2012, it was $394,000 (Saez/Piketty updated stats) but I don't believe there is aggregated data to indicate what it would be as of 2013.
As to lowexpectations' comment, part of what people miss is that income means little. It's the ability for people at a certain income level to save and grow their capital assets faster than inflation. If you are making $50k as a household (usually a two earner household), you are probably taking home 40k and spending 30k or more depending on where you live. So, barring any medical issues or other unexpected expenses, you can maybe save 10k. And that's if you live modestly.
A person making 394k, even if they are only taking home 250k after all taxes, can save 200k if they live a considerably more generous lifestyle than the person making 50k. So, for 8x the pay, you can save 20x as much and still have an easier and more comfortable life on top of it.
Not only THAT, but people with more assets can risk more because of the lower marginal utility of lost income from risk. Someone saving 10k per year will likely save in more "stable" instruments with lower returns because they can't afford a single larger loss if they ever needed to dip into their savings (job loss, move, medical expenses, car problems, etc...). So the inequality diverges yet more!
The article talks about what it takes to put you in the top 1% of earners. Savings rate is irrelevant to that, however I agree if you earn more you can save more as that should be rather obvious to most people
Top 1% earner does not equate to top 1% wealth which is who we refer to when we talk about THE 1% who usually don't have to earn a penny to live like a king for the rest of their life. Many doctors, healthcare providers and lawyers earn 1% income but graduate with 200-400k in student loan... they will unlikely be THE 1% for a long time.
In 2009, it took $77.4 million in adjusted gross income to crack the top 400. (That just barely got you in; the average income of everyone on the list was $202.4 million.)
As of 2012, it was $394,000 (Saez/Piketty updated stats) but I don't believe there is aggregated data to indicate what it would be as of 2013.
As to lowexpectations' comment, part of what people miss is that income means little. It's the ability for people at a certain income level to save and grow their capital assets faster than inflation. If you are making $50k as a household (usually a two earner household), you are probably taking home 40k and spending 30k or more depending on where you live. So, barring any medical issues or other unexpected expenses, you can maybe save 10k. And that's if you live modestly.
A person making 394k, even if they are only taking home 250k after all taxes, can save 200k if they live a considerably more generous lifestyle than the person making 50k. So, for 8x the pay, you can save 20x as much and still have an easier and more comfortable life on top of it.
Not only THAT, but people with more assets can risk more because of the lower marginal utility of lost income from risk. Someone saving 10k per year will likely save in more "stable" instruments with lower returns because they can't afford a single larger loss if they ever needed to dip into their savings (job loss, move, medical expenses, car problems, etc...). So the inequality diverges yet more!
Top 1% earner does not equate to top 1% wealth which is who we refer to when we talk about THE 1% who usually don't have to earn a penny to live like a king for the rest of their life. Many doctors, healthcare providers and lawyers earn 1% income but graduate with 200-400k in student loan... they will unlikely be THE 1% for a long time.
Exactly --- the 1% we hear about in recent discussions are those people who have enough wealth that they get offended if you ask "how much do you earn per year?". These people don't really work for a living because their net worth already pays all their bills and anything they do in their daily lives is strictly for some other endeavor (running for political office, managing a foundation, etc).
People who earn $343,000 per year aren't rich --- they are lower upper class that still needs to worry about paying the bills of life. Many brain surgeons earn $500,000 a year but still lose sleep over the mortgage, kids college funds, etc.
The true 1% don't need to ever worry about paying the bills.
Exactly --- the 1% we hear about in recent discussions are those people who have enough wealth that they get offended if you ask "how much do you earn per year?". These people don't really work for a living because their net worth already pays all their bills and anything they do in their daily lives is strictly for some other endeavor (running for political office, managing a foundation, etc).
People who earn $343,000 per year aren't rich --- they are lower upper class that still needs to worry about paying the bills of life. Many brain surgeons earn $500,000 a year but still lose sleep over the mortgage, kids college funds, etc.
The true 1% don't need to ever worry about paying the bills.
The 1% live on capital gains from generations ago. The 1% know no wants and most likely are unaccustomed to the word "no". The 1% are as royalty and the 1% is few.
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