Where Are the U.S.’s Millionaires?

January 17, 2014 Leave a comment

Jan 16, 2014

Where Are the U.S.’s Millionaires?

ERIC MORATH

The state making the fastest climb up the millionaire rankings doesn’t have a single Tiffany or Saks Fifth Avenue store. The closest BMW dealership is a six-hour drive from the capital.

Welcome to North Dakota, which jumped 14 spots in the annual rankings of millionaire households per capita released by Phoenix Marketing International. The firm derives its figures from a combination of data from the Federal Reserve, Census Bureau and polling firm Nielsen Co. (See a slideshow of the top 10 states)

There were approximately 53,000 more millionaire households in the U.S. last year than in 2012, according to Phoenix, a market research firm based in Rhinebeck, N.Y. About 6.15 million millionaire households are spread across the U.S., according to the report. That means 1 in every 20 households in the U.S. has more than $1 million in investable assets. Those figures don’t include the value of real estate.

Large movements for many states made the latest millionaire rankings unusual. Maine climbed 11 spots over a single year to No. 25 in 2013. Louisiana jumped 10 to No. 32. Meanwhile, Nevada fell 20 spots to No. 39. Arizona, Florida, Idaho and Michigan all fell by more than 10 positions. From 2011 to 2012, no state changed its rank by more than two positions.

The big swings may suggest economic recovery may have become more uneven last year, said David Thompson, a managing director at Phoenix. “Maine and Louisiana are two states that have seen big turnarounds in their economies,” he said. “In Nevada, the data suggests the state is still feeling the effects of the downturn.”

But no state had a bigger surge than North Dakota. In 2012, North Dakota ranked 43rd, one spot behind Alabama. Last year, it moved up to 29th, one ahead of Florida. North Dakota’s energy boom, especially in the Bakken shale region, is driving the state’s wealth gains. But its people in the oil patch aren’t about to flaunt it.

“The only way you know a Bakken millionaire is he’ll be driving a new truck and might have taken his wife on vacation,” said Kelvin Hullet, president of the chamber of commerce in Bismarck, the state capital.

Mr. Hullet said the energy, health care and technology sectors are all growing in the state — pushing up paychecks of both the working class and affluent. The state’s unemployment rate was 2.6% in November, according to the Labor Department. That was the lowest in the nation by a percentage point.

The result has been a rapid expansion of retailers, restaurants and housing, Mr. Hullet said. But Bismarck hasn’t turned into West Egg. “I’ve seen the occasional Bentley,” he said. “But mostly, North Dakota is the type of place where someone can be very wealthy and you’d never know it.”

The top of the overall rankings didn’t change much. Maryland was No. 1 for the third consecutive year, with 7.7% of households holding more than $1 million in assets. New Jersey, Connecticut and Hawaii followed. Those four states, in various orders, have led the rankings every year since 2006.

Phoenix uses the data to inform clients, which include wealth-management firms.

Related: David Thompson of Phoenix Marketing International joins the News Hub

Filed under Macro Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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