A million millionaires, led by Canadian boomers
As this piece on
page A9 of the National Post reports, there are now 1.1 million Canadian
families worth $1 million or more. According to 2005 data contained in a new
survey from Statistics Canada, that’s a jump of 461,000 from six years before.
And yes, a big
reason for that jump is an increasing number of baby boomers who are in their
peak earning years and getting serious about stashing away money for their
looming retirement. Those in their 40s more than doubled their wealth from
$210,800 in 1999 to $456,800 by 2005, while boomers in their 50s almost tripled
their wealth. Included in the calculations are stocks, bonds, vacation
properties, real estate, RRSPs, bank accounts and business equity.
But of course, as University of Toronto
macroeconomics professor Jack Carr notes, “being a millionaire isn’t what it
used to be.” That perennial scourge called inflation continues to erode our
purchasing power. To the extent prices have doubled or tripled, you might argue
you need $2 or even $3 million in order to have the economic clout of
yesterday’s millionaires.
These days, the
financial industry tends to view mere millionaires as part of the “mass
affluent” crowd, although some still get labelled “high net worth.” But they
reserve the term “Ultra High Net Worth” to describe the really well-heeled, a
figure typically north of $10 million. Alternatively, they use the term
“penta-millionaire” to describe those with $5 million, or “deca-millionaire” for
those with $10 million.
So those who are
mere “Uni-millionaires” [a term I’ve just invented) may not want to shut it
from the rooftops, even if they don’t mind endless calls from telemarketers and
fund-raisers from good and not-so-good causes. As one source noted, in the
United States, those with $1 million in financial assets are no longer in the
top 1% or 2% of America’s economic class.
According to
demographer David Foot, also of the University of Toronto, the growth rate of
Canadian millionaires will start to taper off over the next six to nine years,
as the front end of the boomers start selling their investments during
retirement.
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