Here's a contrast for you:
Millionaires on the rise
Stocks and diversification provide fuel for a jump in wealthy households, a new study finds.
September 30, 2003: 9:22 AM EDT
By Jeanne Sahadi, CNN/Money Senior Writer
NEW YORK (CNN/Money) - The number of millionaire households in the United States by mid-year 2003 grew to the highest level in 20 years, rising 14 percent to 3.8 million, according to a new study released Tuesday.
That's up from 3.3 million in 2002 and 3.7 million in 2001, according to NFO WorldGroup, a market research and consulting firm, which conducts an annual survey of affluent households.
NFO defines a "millionaire" household as one having $1 million or more in investable assets, which doesn't include primary residences or 401(k)s among other things.
The increase in households with $1 million or more in investable assets is due largely to increased stability in the equity markets and to well-diversified portfolios, said Jeanette Luhr, NFO Financial Services Director and program manager for the study.
While the number of millionaire households is at a 20-year high, it still accounts for only 3.4 percent of the 111 million households in the United States.
But what about net worth?
Since NFO's study is intended for its clients who wish to attract wealth-holders' assets, the "investable assets" measured by the study do not include those assets that an owner is unlikely to move, such as a vacation home, a 401(k) or 403(b), stock options, investment real estate, annuities, UGMA accounts or closely held business partnerships.
If those are included and household net worth (assets minus liabilities) is measured, then the number of millionaire households jumps to 7.9 million, up from 7.4 million in 2002. But that's still far below the all-time high of 9.8 million households reached in 2001.
Also on the upswing this year were the number of affluent households with a net worth of $500,000 or more, excluding primary residences. They jumped to 10.5 million households from 9.1 million in 2002, NFO found.
Luhr attributed the rise in high-net-worth households to several factors: diversified portfolios, professional guidance and a healthy amount of real estate exposure. The percentage of total assets that affluent households allocated to real estate (not including primary residences) doubled in the past year, NFO found.
"Low interest rates and rising property values have had a profound impact on these households," Luhr noted in a statement.
Confidence edges up
NFO's Affluent Market Research Program Confidence Index, measuring affluent Americans' outlook on the economy and their own financial situations, showed a slight increase overall compared with 2002, but respondents' optimism was not evenly distributed.
When asked by NFO how confident they felt about the stock market, half of the millionaire households felt the broad stock market and the Nasdaq would continue to improve over the next six months, up from 36 percent who felt the same way a year earlier.
They were less confident, however, about the prospects in their own financial lives. Only 35 percent felt their household income and finances would improve versus 55 percent a year ago.
The NFO study comes on the heels of a government report released Sept. 26 that found poverty is on the rise for the second straight year and median incomes in the United States fell for the third year in a row. And on Tuesday, the U.S. Census Bureau reported the number of Americans without health insurance grew by 2.4 million people in 2002, bringing the total number of uninsured to nearly 44 million.
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More Americans lack health insurance
Census survey shows increase in those without coverage for second straight year.
September 30, 2003: 12:04 PM EDT
WASHINGTON (Reuters) - The ranks of Americans without health insurance grew by an estimated 2.4 million in 2002, the second consecutive yearly increase, the U.S. Census Bureau reported Tuesday.
New report from the Census Bureau shows the number of Americans without health insurance showed the largest single increase in a decade last year. CNNfn's Louise Schiavone reports.
About 15.2 percent of the population, or 43.6 million people, lacked medical coverage for the entire year, the Census Bureau said in a report that prompted new calls for lawmakers and President Bush to address the problem. In 2001, 14.6 percent lacked health coverage.
Last year's drop was attributed largely to fewer people receiving insurance from employers. The percentage of those covered by employment-based health insurance slid to 61.3 percent in 2002 from 62.6 percent in 2001, the report said.
Some of the uninsured had lost their jobs as the economy struggled through a recession, according to policy experts.
In other cases, employers dropped health coverage as premiums rose, or increased employees' portion of the cost to the point that some workers could not afford to pay.
"Clearly employers are struggling to hang on to their coverage," said Kate Sullivan, director of health care policy for the U.S. Chamber of Commerce.
Government insurance programs such as Medicaid provided a cushion. About 25.7 percent of people were covered by the government program in 2002, up from 25.3 percent in 2001.
"Things could have been substantially worse" without the government assistance, said Leighton Ku, a senior fellow at the liberal-leaning Center on Budget and Policy Priorities.
The new figures should spur politicians to quickly agree on ways to help more people obtain medical coverage, said Ron Pollack, executive director of Families USA, a health advocacy group.
"The failure to do so may have significant repercussions in the 2004 elections," Pollack said.
Lawmakers have philosophical differences over the best way to help the uninsured. Republicans tend to favor market-oriented solutions such as tax credits. Democrats usually support a larger government role in covering the uninsured.
Health and Human Services Secretary Tommy Thompson said Congress should pass the administration's plans, which include tax credits to help make private insurance more affordable, expansion of the government's tax-free Medical Savings Accounts program and more funding for state health insurance for children.
"Congress must give us more tools to provide more care to more families," Thompson said in a prepared statement.
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