NPR’s Planet Money recently published an article with the hook “The Powerful Millionaires Hiding in Plain Sight” and titled Attack of the Tax Ninjas. I am not here to opine on their tax strategies or their ability to shift public policy. It is our government, we are the customers, and if you want a different outcome, convince others with better ideas.
I am however very interested in the question posed to open the article, “Who is rich in America, and how did they get there?” The current narrative of a cabal of oligarchs controlling our lives simply doesn’t jive with the data or reality. “Mainstreet Millionaires” are everywhere.
“Look beyond Silicon Valley. Look beyond Wall Street. There’s a much larger class of wealthy Americans hiding in plain sight. They’re all around the country. And, often, they got rich in mundane ways. They own car dealerships. They sell hot dogs and frozen mini-quiches. They run waxing salons. They supply fabricated metal and urinal cakes. They are dentists.”
I keep coming back to an idea related to the 12M families with $1-5M estates. Do they know they are wealthy? Do they feel wealthy? Do they consider themselves wealthy? If Mom and Dad bought their home decades ago, odds are the mortgage is either low or paid off, and the home has arguably appreciated dramatically. If Mom and Dad diligently saved and invested, their retirement accounts are arguably sizeable enough to matter. Statistically, they are wealthy.
The idea, admittedly not fully formed, is that Mom and Dad are wealthier than they give themselves credit for. They’ve spent a lifetime comparing themselves to “the wealthy” who might still have more wealth, but that’s not the point. The point is that they are “boringly wealthy” or “accidently wealthy” or something of this ilk. Hear you me: I am not trying to be disrespectful. Frankly, I’m trying to celebrate that their diligence and consistency in doing more right than wrong got them to a place where their estate is worth at least $1M. That’s a lot of money! We should be celebrating this!
And if an estate is worth at least $500K, it’s worth protecting with a little bit of time and money and effort. A $500K estate can afford a Will, a Trust, and Forward Inheritance. Or said another way, can it afford to not have these protections? I may be biased, but that doesn’t mean I’m wrong. We can help Mom and Dad. We can help ourselves. We can move our families forward…