Nearly one out of every 20 Texas households has liquid assets of $1 million or more, according to a new report by the Phoenix Global Wealth Monitor.
“I think the strong Texas economy is starting to lift the number of millionaires,” said David Thompson who oversees the monitor for Phoenix Marketing International in New York.
“Texas continues to fare pretty well in our rankings. It’s certainly a testament to the strong and diverse economy there,” he said.
The Lone Star State, with an estimated 4.89 percent or 456,949 households with investable assets of at least $1 million, moved up four spots in the 2013 rankings to the No. 22 slot.
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That was an increase of 20,572 “millionaire” households since 2012 and 106,222 since the first wealth monitor report in 2006 when Texas was ranked No. 30.
The monitor is measured by “liquid wealth” that excludes money tied up in residences, real estate and 401(k) plans.
“We measure wealth that is easily transferred from one place to another,” Thompson said.
The energy boom has undoubtedly helped the Texas surge in recent years but it pales in comparison to the big one-year jump by North Dakota which moved up 14 spots to No. 29 with 4.59 percent or 13,494 households in 2013.
“North Dakota’s energy boom is clearly lifting some of their population into the millionaire status. Other states like Pennsylvania have also benefited from the good fortune of having energy reserves,” Thompson said.
It also helps that North Dakota was the fastest-growing state between 2010-13, adding nearly 51,000 residents, according to the latest U.S. Census estimates. But to put that in perspective, Texas was the second-fastest growing state, adding more than 1.3 million.
Even if they are moving up on the wealth meter, Texas and North Dakota have a long way to go to catch up with No.1 Maryland where 7.7 percent of households have at least $1 million in assets. Mississippi, at 3.63 percent, was ranked No. 51.
Also in the top five of well-moneyed states were No. 2 New Jersey, No. 3 Connecticut, No. 4 Hawaii and No. 5 Alaska.
“When you look at the top states, New Jersey, Maryland, Connecticut, Massachusetts are all states that are in a center of financial strength, meaning there are a lot of financial sector jobs. And of course, Maryland, being in the center of D.C. has all the government jobs,” Thompson said, noting that the District of Columbia was ranked No. 10.
Hawaii, which has been at or near the top of every year’s list, stays there due to “all those rich retirees,” he said.
The number of millionaire households has been steadily growing since the financial collapse in 2008-09 of the Great Recession, Thompson said.
Nationwide, there were an estimated 6,145,533 millionaire households, an increase of 760,218 since 2006.
“The wealth monitor tends to follow the path of the S&P 500, as it has ebbed and flowed. Generally, the number of millionaire household pretty much follows that,” he said.
An increasing number of Texas households have investment assets of $1 million or more.
Source: Phoenix Global Wealth Monitor