- There are 618,000 millennial millionaires in America, according to a new report by Coldwell Banker.
- The typical millennial millionaire has a net worth ranging from $US1 to $US2.49 million.
- They also view real estate as a key way to build wealth – the average millennial millionaire owns three properties.
- Visit Business Insider’s homepage for more stories.
There are 618,000 millennial millionaires in America, and they’re sitting on a nice pile of assets.
Think a net worth ranging from $US1 to $US2.49 million, three properties, and a BMW. That’s according to a new report by Coldwell Banker.
The Coldwell Banker Global Luxury program worked with wealth intelligence data and research firm WealthEngine to analyse the lifestyles of millennial millionaires, from wealth creation and property investments to spending trends. It defined millennial millionaires as those ages 23 to 37 with a net worth of more than $US1 million.
The report found that the average millennial millionaire is married, lives in California, and is on the hunt for real estate that is affordable and within walking distance of the centre of action.
Meet the typical American millennial millionaire, according to highlights from the report.
The typical millennial millionaire is between the ages of 34 to 37 and has a net worth between $US1 and $US2.49 million.
Millennial millionaires differ from the millionaires of the early 1980s (the time of America’s last millionaire boom) in that they’re set to inherit even more wealth from their baby boomer parents, who are considered history’s wealthiest generation, according to the report.
It’s estimated that $US68 trillion will be passed down from boomers within the next few decades during the “Great Wealth Transfer.” By 2030, millennials will hold five times as much wealth as they do today.
“While the inheritance component is hard to quantify with the current data available, there are still many millennials who are not considered wealthy today, but will be in the future,” the report states.
Millennial millionaires in the US own an average of three properties. Their average real-estate portfolio is worth $US1.4 million.
“Given their age and real-estate portfolio value, plus the fact that many of them own businesses and stand to inherit a lot of wealth, millennial millionaires are poised to be one of the richest and most influential generations in history,” reads the report.
Additionally, many millennial millionaires see investing in real-estate as the key to wealth building.
According to Dana Bull, a real-estate investor, the financial advantages of investing in real estate are plentiful: positive cash flow, appreciation in terms of housing values, leverage, and tax advantages.
Most American millennial millionaires are homeowners, and most own a single-family home.
Ninety-two per cent of millennial millionaires in the US are homeowners, according to the report. And 77% of them said they’re interested in home improvement.
Some real-estate agents in luxury markets find that millennial millionaires aren’t into fixer-uppers, according to the report. But Jade Mills, a Coldwell Banker Global Luxury Ambassador and Beverly Hills real-estate agent, said they’re open to open to buying fixer-uppers in desirable areas if they can’t afford new construction properties.
The most popular state for millennial millionaires is California: Eight of the top 10 ZIP codes they live in are concentrated in the Golden State.
According to the report, 44% of millennial millionaires live in the Golden State. Seven of the eight California ZIP codes are in Silicon Valley specifically, which highlights the relationship between tech and wealth.
New York, Florida, Massachusetts, and Texas are the states with the next-largest population of millennial millionaires.
When buying luxury real estate, most millennial millionaires focus on the walkability factor.
“They want to live near gathering spaces,” Karen Yang of Coldwell Banker Residential Brokerage in Los Altos in California said in the report. “They want to live near throwback downtowns, or districts that grew organically – and they are willing to give up square footage and amenities to be able to live in those kinds of locations.”
Business Insider previously spoke with several real-estate agents in three states that are popular among rich millennials – New York, California, and Florida. They, too, all told Business Insider that location and walkability are key factors among buyers.
In New York City, many want to be able to walk to work, Ian Slater of Compass told Business Insider. Millennials also want to walk to restaurants, recreational activities, and, in the case of Florida, the water, West Palm Beach real-estate agent Burt Minkoff of Douglas Elliman said.
Most American millennial millionaires are married. Those who have kids typically have just one.
Millennials have delayed significant life milestones like marriage and children, but wealthier millennials are ahead of the curve when it comes to marriage: 67% are married, compared to only 40% of the general millennial population.
According to the report, all cohorts – millennials, millionaires, and millennial millionaires – who have children typically have just one.
Millennial millionaires have a wide range of interests, but they’re overwhelmingly interested in health and fitness, and technology.
The report states that they prefer to live within walking distance of yoga studios, fitness facilities, and organic dining restaurants. They support local farms and farmer’s markets and some grow their own produce.
Entire industries are developing or adjusting services to cater to this increased interest in wellness, Business Insider’s Lina Batarags reported. Consider wellness, which is increasingly regarded as a modern embodiment of luxury. Accordingly, an array of spas and studios offering treatments like cryofacials, weeklong retreats, and vitamin IV drips are delivering those experiences.
When it comes to real estate, they have expressed interest in trends like eco-conscious building practices and expect a high level of smart-home technology.
Millennial millionaires are practical and reliable when it comes to car ownership. The most frequently-owned car model among millennial millionaires is a BMW 3 series (one of the brand’s more affordable models), followed by a Honda Accord and Jeep Cherokee.
The top car brands millennial millionaires drive are Toyota, Honda, and Ford, the report indicates.
A BMW 3-series car has a starting price of $US40,750.
But some millennial millionaires indulge in collectible and classic cars. As the report states, at the 2019 Monterey Classic Car event, there was an increase in buyers among this cohort, who preferred vintage cars from the 80s and 90s and sports cars.
The typical millennial millionaire donates to charity, more than any other generation. Political causes are their charity of choice.
Thirty-five per cent of millionaires donate to charity, compared to 56% of millennial millionaires, according to the report.
And 70% of these millennials are willing to spend more with brands that support causes they care about.
“More and more, the wealthy are evaluating a brand in terms of: What mission does this brand represent?” Mike Phillips, Wealth-X‘s vice president of marketing and communications, told Batarags. “How does it contribute to the greater good … If I choose to purchase this product, what does that say about me and my values?”