What does it mean to be a ‘millionaire’?
When you hear the word, “millionaire,” what do you think?
Many people might say that being a millionaire means having wealth, power, influence, style, and an abundance of leisure time. A millionaire lives in a mansion, drives a luxury car, flies first class, sips champagne, and hobnobs with powerful people.
But many real-world millionaires might not recognize that image. That’s because the average net worth of an American household is $1.06 million. Of course, the average is skewed upward by some very rich households. But nevertheless, the stat is true: the average household in America now has a million-dollar net worth.
Here’s another way of looking at it. Eighteen percent of American households are millionaire households, so about one out of every five. And—I am sorry to say—most of them do not have a Ferrari parked in the garage. Many millionaires work five days a week, drive economical cars, mow their own grass, and cook dinner at home.
A millionaire is a person or a household with a net worth of one million dollars, or the equivalent in another currency. To calculate your net worth, you simply add up the value of your bank accounts, investments, real estate, business equity, and valuables. Then, subtract everything you owe: mortgages, car loans, student loans. The difference is your net worth. And if that number is higher than one million dollars, then, congratulations, you are a millionaire.
But a million dollars is not what it used to be, at least not if you live in high-cost location like the United States.
The word “millionaire” was first used in France in the early 1700s. It referred to people who made millions of livres, the French currency, during a speculative financial bubble. Many of the first millionaires, as these rich people were called, were poor again just a year later, after the financial bubble burst.
But the word “millionaire” survived, and it jumped to English in the late 1700s. In England and the United States, it referred to a person with a million pounds sterling or a million dollars. And for many years, the word was synonymous with extreme wealth. The millionaires of America’s “Gilded Age” had vast estates, a roster of live-in servants, yachts, and the finest food and clothing. If you had a million-dollar net worth in the early twentieth century, you were in an exclusive club indeed.
Since then, though, there’s been more than a century of steady inflation. And beyond that, the economy grew and diversified. Mortgage loans made homeownership accessible to the middle class. Workplace retirement plans helped millions of workers accumulate wealth with automatic savings. The stock market delivered decades of long-term growth (and it became easier than ever to own stocks).
All this means that reaching a seven-figure net worth has become a realistic goal for disciplined savers with good jobs. You no longer need to be an industrial magnate or an heir to a fortune to be a millionaire.
It’s difficult to compare dollars-to-dollars across centuries. If you look only at the effects of inflation, you’d need about $38 million today to have the purchasing power of a millionaire circa 1900. But if you want to be in the same strata of society—if you want the same level of prestige and exclusivity as the millionaires of yesteryear—then you’d probably need a net worth of $100 million or more today.
And yet, the word “millionaire” seems frozen in time as a marker of extreme wealth. Politicians who rage against “the rich” frequently invoke the word millionaire: “we’re not giving tax cuts or subsidies to millionaires,” they say. A popular quiz show, “Who Wants to be a Millionaire”, has been on American television for two decades. The word “millionaire” clearly still carries a mystique, even as the value of one million dollars has diminished.
So what does it mean to be a millionaire in 2026—to have a net worth of one million dollars or more, and to live in the U.S.? Here’s what the numbers show. Today, there are about 22 million millionaire households in the United States. So about one in five households has a seven-figure net worth.
Two-thirds of millionaires are in their 60s and 70s. Ninety-five percent of them own their own homes and most have paid off their mortgage loans. Eight out of ten millionaires didn’t inherit their fortunes, but instead accumulated wealth through retirement savings, investments, businesses, and their primary homes.
Millionaire households make good money, but their income might surprise you. The average income of a person with a $1 to $3 million net worth is just $164,000 per year. That’s a good income, an upper-middle-class income. But that’s not private jet money.
If you go for a walk through the suburbs of America, you’ll probably walk by the homes of millionaires without even knowing it. You’re much more likely to see a Toyota Camry in the driveway than a chauffeured Bentley. You’ll see parents packing lunches for their kids the next day. You’ll see millionaires mowing their own grass, washing their own cars, taking their own trash to the curb. You’ll see them eating at casual restaurants, volunteering in their communities, shopping at Walmart.
Don’t get me wrong: reaching a million-dollar net worth is a real accomplishment. It means financial security in retirement, fewer worries about money, a comfortable house, the ability to help your kids, and leave something behind.
But there’s no denying that “millionaire” just doesn’t mean what it used to. The mystique of extreme wealth hasn’t gone away, however. It’s just that the decimal point has moved a few places. Today, we have a new word for the ultra-wealthy, and that word is: “billionaire.”
Jeff’s take
When I was in college, I went to a taping of the quiz show “Who Wants to be a Millionaire.” That was with Regis Philbin, the original host. It was huge; it was the most popular show on television at the time, and we watched it in the dorms.
On the show, the contestants answer progressively more-difficult questions on their way to winning a million dollars—but if they get just a single question wrong, they lose everything.
And on the journey, the contestants are allowed to ask the audience for help on just one question. So on the day I was there, the contestant was stuck, and she asked audience for help, and we voted on that question. The contestant saw the results before answering. And I’ll never forget this, I guessed wrong!
Now, luckily, the majority of the audience guessed right, and the contestant answered that question correctly. She didn’t win a million dollars that day. But hey, for all we know, she might have been a millionaire before she even walked into the studio.
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