You’ve heard of being wealthy, but what about being wealthy en masse?

By | September 13, 2023

mass tributary

mass tributary

Households are often divided by consumption and wealth levels so that marketers and businesses can better understand their spending habits. Some segments exhibit specific behaviors that, once identified, allow companies to meet their needs in a more personalized way.

According to Pew Research, middle class income has grown 49% over the past 40 years. In contrast, high-income families saw their average income nearly double over the same period. Income inequality has grown at a faster rate in the United States than in any other country, even as consumption habits for each class segment have changed.

Wealthy families are highly sought after by businesses despite their dwindling numbers. Here we dive into the details and explore exactly why this happens and what it means if you are one of them.

A financial advisor could help you better determine whether you are on track to achieve your long-term financial goals. Find a qualified advisor today.

Definition of mass affluent

Massively affluent is a term that describes a middle-class family that earns an annual income greater than $75,000 and holds between $100,000 and $1 million in investable assets. As middle-class earners, the mass affluent are typically employed in white-collar jobs and have substantial savings. These include globetrotters, power couples, civic activists and suburbanites who invest heavily in their retirement funds.

The mass affluent, as part of the shrinking middle class, are nevertheless a highly sought after group. In 2017, the wealthy comprised 30.7 million households in the United States, with assets of $10.2 trillion. They target marketers and business professionals because they serve as a bridge group between the mass middle class and the affluent or high-net-worth group.

What characteristics do the mass rich have?

mass tributary

mass tributary

The mass rich are a marketing sweet spot among the middle class and upper class. Like the mass middle class, they make up a large and accessible audience for business, but because they typically earn six-figure salaries, working in business, finance or management, they hold a higher-than-average amount of funds.

While the average mass affluent is a 59-year-old Caucasian, Asian Americans are 36% more likely to be mass affluent than those who are not. In fact, the mass affluent is predicted to be the next megamarket in Southeast Asia by 2030.

This group of consumers is characterized by their consumption habits, fueled by above-average incomes. They are more likely to spend on premium goods and services and account for up to half of consumer spending on leisure travel, watches, jewelry and automobiles.

How do the mass affluent differ from the high net worth?

Because the mass affluent hold less than $1 million in cash, they are often disadvantaged by the financial community. 80% of the wealthy and megamillionaires work with financial advisors to plan and manage their finances, but only 60% of the affluent masses do so.

The goals for their finances change from one group to another. The mass affluent likely work in corporations, but more than two-thirds of high-net-worth individuals are retired. Most of the net worth of the mass affluent comes from a primary residence, while high net worth individuals have between half and two-thirds of their wealth held in investable securities. The mass affluent are also noticeably more conservative in risk taking.

As a result, from a financial perspective, the goals of the mass affluent focus more on wealth creation than those of the high net worth category. They need help with retirement savings planning, principal protection and growth strategies, as well as tax planning. Some opportunities to take advantage at this level include: maximizing IRA contributions, investing in annuities, and purchasing term or whole life insurance.

On the other hand, high net worth groups will focus more on formal income planning, wealth preservation, tax and gift planning, and estate and trust plans.

The bottom line

mass tributary

mass tributary

Massively wealthy is a term used to describe middle class earners with a higher net worth. People in this wealth group live a comfortable lifestyle and consume premium goods. Because they focus more on creating wealth than preserving it, they are a prime target for companies and marketers.

Tips for building wealth

  • Not sure what investments and strategies will help you achieve your long-term goals? For a solid financial plan, consider speaking with a qualified financial advisor. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisors at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you reach your financial goals, start now.

  • Use SmartAsset’s free investment calculator to get a good estimate of how to grow your money over time.

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