What’s it Take to be the Top 1%?
Confession time, I have always been a sucker for statistics. Especially ones that are finance-related, as it is a guilty pleasure being a financial planner I suppose. Recently Bloomberg (yes, the same guy who recently ran in the presidential primary) posted an article talking about what it takes to be in the top 1% of earners in America and the world. The findings were extremely interesting to me so figured why not share them with all you wonderful people.
Let’s start by narrowing these studies to the developed world excluding the extremely impoverished counties. What you’ll find is to make the list the range by country is quite broad, although the average seems to be in the $200,000 range to make this illustrious list. The low end is $77,000 and the high end is $922,000 to be considered the top 1% of earners by country. Can you guess which countries make the low and high end? If you guess India as the low end and the United Arab Emirates as the high end you would be correct!
Top 1% in the US
How about the right here at home in the United States of America. What does it take here to earn what the top 1% earn? Well, you would have to earn $488,000/yr to consider yourself a top 1% earner. To be considered a top .1% would require an income of over $2,000,000 and to make the exclusive .01% list $10,000,000. Shameless plug: Remember if you make any of these lists we are taking on new clients.
Here is the list from the Bloomberg article:
Now with an election coming up, I found the next chart quite interesting as it talks about the top marginal tax rate (in 2018) for these countries. For as much as we complain about taxes the U.S. wasn’t at the top of the list. As you can see we seem to fall on the upper end of the tax rate list. Guess you can see what more socialized programs would likely do to our tax rates. As many of the countries at the top have global health care and other government programs that we don’t. Of course we have a military spending that is larger than the next 7 countries combined. Where should we be spending our money and who should we be taxing? Heck if I know I’m simply a data junky.
Where do I fit in?
I know what most of you are thinking right about now, probably the same I am, man there is a lot of wealth around the planet. I for one am happy for those that earn a great living. The other thought going through most of your heads is also, this is great Andrew but where do I fit in? Seek and you should find my friends. Here is a nifty site I found going down this rabbit hole that speaks to where your income, and wealth, rank you in the world. Disclaimer this is a path that may occupy you for a while as it did for me. Click here to see where you match up. Pretty interesting right? To save you some time if you made $1.76 billion dollars this year you would have been #1 on the list. Also if you earned $1.76 billion dollars I’m free to grab a drink and hang out this weekend!
If you’d like to take this dialogue to a more philanthropic route here is a great link from givingwhatwecan.org. It speaks to the impact of what your donations could mean to the world. Certainly, if you are on the list you are more fortunate than 99% of those walking this earth. I think the great equalizer here is deciding how one spends their wealth beyond personal lifestyle. How can those choose to spend their money to make a difference? Seeing those like Bill Gates and Warren Buffet commit to giving the majority of their wealth away tells me there is plenty of good we can do with wealth beyond personal pleasures.
So where do you fall on this list? What will you do with your money? There is certainly no wrong answer like I said I’m just a junky for this kind of stuff.