# Why will most Americans never become mega millionaires or billionaires? **URL:** \ **Category:** Great Debates\ **Created:** [January 23, 2016, 2:44pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969 "2016-01-23T14:44:33Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![Dr.Strangelove](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dr.strangelove/32/6613_2.png) [@Dr.Strangelove](https://boards.straightdope.com/u/Dr.Strangelove)\ **Post date:** [January 25, 2016, 10:35am UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/61 "2016-01-25T10:35:43Z")
We must hang out in different circles. A number of my engineer colleagues have net worths in the low millions and none of us have set up shell corporations for tax avoidance. To be honest, I still don’t see how to get money or assets out of the shell corporation without a tax event. At best, I can see this being a means of income smoothing before an early retirement. Which, admittedly, could be useful to me, although I’m still dubious about the legality. ---
**Author:** ![coremelt](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@coremelt](https://boards.straightdope.com/u/coremelt)\ **Post date:** [January 25, 2016, 11:03am UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/62 "2016-01-25T11:03:11Z")
> [@Dr.Strangelove](#): > > We must hang out in different circles. A number of my engineer colleagues have net worths in the low millions and none of us have set up shell corporations for tax avoidance. > > To be honest, I still don’t see how to get money or assets out of the shell corporation without a tax event. For one thing its tax liability reduction (legal) not tax avoidance (illegal). At least in Australia paying yourself a franked dividend from a company is taxed at a lesser rate than regular income. There is numerous other ways. As for it being legal, all I can say is that my legal and financial advisors (who are reputable) assure me that it is. ---
**Author:** ![Chihuahua](https://avatars.discourse-cdn.com/v4/letter/c/dec6dc/32.png) [@Chihuahua](https://boards.straightdope.com/u/Chihuahua)\ **Post date:** [January 25, 2016, 12:04pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/63 "2016-01-25T12:04:58Z")
Interested in hearing OP’s reasoning for why everyone should be able to be wealthy. Aptitude, interest, opportunities, and dumb luck should make the answer pretty self evident. ---
**Author:** ![coremelt](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@coremelt](https://boards.straightdope.com/u/coremelt)\ **Post date:** [January 25, 2016, 12:23pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/64 "2016-01-25T12:23:10Z")
> [@Chihuahua](#): > > Aptitude, interest, opportunities, and dumb luck should make the answer pretty self evident. Becoming wealthy is a shit load of hard work if you don’t inherit it. I know an ordinary bank loans approval officer earning a modest salary who now owns about eight investment properties (or rather is paying them off). He had the discipline and intuitive to start doing that in his twenties and he’s going to be very well off when he retires. Or he could have just coasted, gone home and watched TV or played XBox every day after work. Thats what most people do and thats why they don’t get rich. (Yes being born into the right background is also a huge help… but his father was a working class builder not especially well off). ---
**Author:** ![nicky](https://avatars.discourse-cdn.com/v4/letter/n/f0a364/32.png) [@nicky](https://boards.straightdope.com/u/nicky)\ **Post date:** [January 25, 2016, 1:17pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/65 "2016-01-25T13:17:40Z")
The point is hard work isnt enough. Your thrifty self made property tycoon could quite easily be bankrupted by events far outside his control. ---
**Author:** ![BobLibDem](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/boblibdem/32/3149_2.png) [@BobLibDem](https://boards.straightdope.com/u/BobLibDem)\ **Post date:** [January 25, 2016, 1:34pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/66 "2016-01-25T13:34:57Z")
> [@nicky](#): > > The point is hard work isnt enough. Your thrifty self made property tycoon could quite easily be bankrupted by events far outside his control. I agree. The only sure way to become a millionaire is to be born one. Bill Gates could have failed early in his career if someone had a better idea or beat him to the punch. There may be another guy out there that had an idea just as good as Gates’ but for whatever reason just couldn’t put it into production in time, maybe he died a pauper. You can bust your ass for a lifetime and not make it big, or you can stumble onto something and get lucky. ---
**Author:** ![coremelt](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@coremelt](https://boards.straightdope.com/u/coremelt)\ **Post date:** [January 25, 2016, 1:36pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/67 "2016-01-25T13:36:11Z")
> [@nicky](#): > > The point is hard work isnt enough. Your thrifty self made property tycoon could quite easily be bankrupted by events far outside his control. Of course there is always that chance but property in a developed country like Australia is one of the safest possible investments. You gotta take risks to get the gains. No one ever got rich by working all their life for a salary and then putting their money in a savings account. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [January 25, 2016, 2:13pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/68 "2016-01-25T14:13:30Z")
> [@coremelt](#): > > You’re not talking to the right financial advisors then. There are numerous legal ways of reducing tax liability even for salaried employees. You may decide not to do so because it’s against your principles, but let me assure you its possible. You’ve been posting an awful lot of claims in this GD thread. Got any cites? ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [January 25, 2016, 2:23pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/69 "2016-01-25T14:23:26Z")
> [@DinoR](#): > > [US Per captia GDP in 2014](http://data.worldbank.org/indicator/NY.GDP.PCAP.CD) - 54,629.5 > > In 40 working years that would be 2.185 million. Just taxes take you below the multi-million mark in lifetime earnings. The there’s the issue of even minimum expenses to survive. Unless most Americans figure out a way to be vastly more productive, growing the economy significantly, there’s not enough top split up to make most multi-millionaires. $5k invested per year at 7% return, which is not unreasonable, will get you pretty close to $1M after 40 years. I was investing $5k per year when I was making less than half the per capita GDP. Now, one million is not mega millions. I don’t know what counts as mega. I suspect it requires some multiple of $5k/year that _isn’t_ viable for any competent person who can hold down a job. But one million certainly is. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [January 25, 2016, 2:37pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/70 "2016-01-25T14:37:36Z")
> [@Ruken](#): > > You’ve been posting an awful lot of claims in this GD thread. Got any cites? I found one for you: [http://www.nytimes.com/2015/12/30/business/economy/for-the-wealthiest-private-tax-system-saves-them-billions.html](http://www.nytimes.com/2015/12/30/business/economy/for-the-wealthiest-private-tax-system-saves-them-billions.html) Although it’s generally for income generated from wealth. ---
**Author:** ![coremelt](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@coremelt](https://boards.straightdope.com/u/coremelt)\ **Post date:** [January 25, 2016, 3:22pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/71 "2016-01-25T15:22:49Z")
> [@Ruken](#): > > You’ve been posting an awful lot of claims in this GD thread. Got any cites? I could post specific examples of companies that specialize in doing this but I don’t want to be accused of spamming . Anyway it’s not hard to find with a Google search . Admittedly I have more legal options available since I’m not a US citizen and don’t get taxed on global income like you guys do, but even for us citizens there are some avenues . ---
**Author:** ![Chihuahua](https://avatars.discourse-cdn.com/v4/letter/c/dec6dc/32.png) [@Chihuahua](https://boards.straightdope.com/u/Chihuahua)\ **Post date:** [January 25, 2016, 5:26pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/72 "2016-01-25T17:26:10Z")
> [@BobLibDem](#): > > I agree. The only sure way to become a millionaire is to be born one. Bill Gates could have failed early in his career if someone had a better idea or beat him to the punch. There may be another guy out there that had an idea just as good as Gates’ but for whatever reason just couldn’t put it into production in time, maybe he died a pauper. You can bust your ass for a lifetime and not make it big, or you can stumble onto something and get lucky. I know many people who have been lifelong business owners. They do everything “right” and still fail. And this is true for many things. Real estate speculation used to be considered a sure way to get rich, until 2008 rolled around… Then again, you have some people like E.L. James that just randomly and inexplicably hit the jackpot, despite a complete absence of skill or talent. FWIW, I know I will never be rich for two reasons: First, I have simple tastes and don’t need luxury goods. Second, I have not the slightest bit of interest in business as a career. When I look at people who work traditional paths to wealth (stock markets, business ownership, real estate, etc) I suspect I would kill myself if I had to do that for a living. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [January 25, 2016, 6:04pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/73 "2016-01-25T18:04:41Z")
> [@BobLibDem](#): > > I agree. The only sure way to become a millionaire is to be born one. Bill Gates could have failed early in his career if someone had a better idea or beat him to the punch. There may be another guy out there that had an idea just as good as Gates’ but for whatever reason just couldn’t put it into production in time, maybe he died a pauper. You can bust your ass for a lifetime and not make it big, or you can stumble onto something and get lucky. I don’t know if Gates’ father was a millionaire or not, but he was pretty well off, which enabled Gates to drop out of Harvard. And Gates did not become rich by inventing anything. (MS BASIC was pretty good, but not an innovation and it didn’t make him rich.) He got rich by getting the rights to an OS, convincing IBM to use it, and then realizing what he had. It was market and sales innovation, not technical innovation. Kind of like Romney and Trump, it is easier to be a risk taker with a parental safety net. ---
**Author:** ![psikeyhackr](https://avatars.discourse-cdn.com/v4/letter/p/97f17d/32.png) [@psikeyhackr](https://boards.straightdope.com/u/psikeyhackr)\ **Post date:** [January 25, 2016, 6:10pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/74 "2016-01-25T18:10:09Z")
> [@Quartz](#): > > The economy is not a zero-sum game. I didn’t say it was a Zero-sum Game, I said there were zero-sum aspects. Tell Lester Thurow. 🆒 > **[The Zero-Sum Society: Distribution And The Possibilities For Change - Kindle...](https://www.amazon.com/Zero-Sum-Society-Distribution-Possibilities-Change-ebook/dp/B00A4JNNNS)** > > The Zero-Sum Society: Distribution And The Possibilities For Change - Kindle edition by Thurow, Lester C. Download it once and read it on your Kindle device, PC, phones or tablets. Use features like bookmarks, note taking and highlighting while... What would everyone being millionaires do to inflation? Therefore what would be accomplished? psik ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [January 25, 2016, 6:11pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/75 "2016-01-25T18:11:56Z")
> [@Ruken](#): > > I found one for you: > [http://www.nytimes.com/2015/12/30/business/economy/for-the-wealthiest-private-tax-system-saves-them-billions.html](http://www.nytimes.com/2015/12/30/business/economy/for-the-wealthiest-private-tax-system-saves-them-billions.html) > > Although it’s generally for income generated from wealth. Your average engineer with a few million in wealth - not income - is not going to be able to afford any of the stuff mentioned in that article. Maybe **coremelt** ’s methods work in Australia, but if they worked for those with a million or two in the US you’d be seeing lots of companies advertising it. My wife is a writer, and does a Schedule C, so I know about the many non-obvious deductions she can take to lower her income. But it is hard to do for salaried people, even harder now than it was 20 years ago when I could deduct some dues at least. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [January 25, 2016, 6:16pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/76 "2016-01-25T18:16:23Z")
> [@Chihuahua](#): > > FWIW, I know I will never be rich for two reasons: First, I have simple tastes and don’t need luxury goods. Second, I have not the slightest bit of interest in business as a career. When I look at people who work traditional paths to wealth (stock markets, business ownership, real estate, etc) I suspect I would kill myself if I had to do that for a living. You should read the **Millionaire Next Door** book mentioned above. Having simple tastes is exactly the way to get rich. They note that many people with very high incomes are broke all the time because they spend it all, while many with lower incomes are a lot wealthier because the save it. The News of the Weird today was about a British couple who were lottery winners. They immediately spent it all, and now are suing to go back on the dole because they are broke again. They said they “deserved” to buy all that stuff. An extreme case of someone who will not be a millionaire, but I know of several less extreme cases right near me. ---
**Author:** ![Kimstu](https://avatars.discourse-cdn.com/v4/letter/k/ecd19e/32.png) [@Kimstu](https://boards.straightdope.com/u/Kimstu)\ **Post date:** [January 25, 2016, 6:34pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/77 "2016-01-25T18:34:14Z")
Getting back to the OP, the fundamental point is that **even if most Americans “did everything right”** in terms of working hard, living frugally, investing wisely, and taking advantage of money-making opportunities, **most Americans still would never become exceptionally wealthy** , in the sense we now associate with mega-millionaires/billionaires. _ **Because being “exceptionally wealthy”, by definition, is something that most people cannot be** _. A person is only wealthy **relative** to the **non-wealthy majority**. As earlier posters pointed out, if most people had a million dollars, then the resulting price inflation would simply shrink the real value of the dollar until a million represented merely ordinary purchasing power. Hey presto shazam: all of a sudden most people may be still **nominally** millionaires, **but they’re no longer rich or wealthy in any meaningful sense of the term**. Being uncommonly or extraordinarily or unusually rich can never be a common or ordinary or usual experience. **By definition**. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [January 25, 2016, 6:37pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/78 "2016-01-25T18:37:05Z")
> [@Voyager](#): > > Your average engineer with a few million in wealth - not income - is not going to be able to afford any of the stuff mentioned in that article. Maybe **coremelt** ’s methods work in Australia, but if they worked for those with a million or two in the US you’d be seeing lots of companies advertising it. > My wife is a writer, and does a Schedule C, so I know about the many non-obvious deductions she can take to lower her income. But it is hard to do for salaried people, even harder now than it was 20 years ago when I could deduct some dues at least. Yeah the stuff in the article is more “how to grow your $100M with the lowest tax burden possible.” Might cost a few million to manage. Just, say, trying to protect $250k in earned annual physician income by incorporating isn’t going to do a ton for you. ---
**Author:** ![coremelt](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@coremelt](https://boards.straightdope.com/u/coremelt)\ **Post date:** [January 25, 2016, 6:50pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/79 "2016-01-25T18:50:28Z")
> [@Ruken](#): > > Just, say, trying to protect $250k in earned annual physician income by incorporating isn’t going to do a ton for you. Well then all I can say is it sucks to be a US citizen, because I earn considerably less than $250k but I save a ton by being a company. Although I do have some employees, its not just a shell corp. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [January 25, 2016, 8:05pm UTC](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969/80 "2016-01-25T20:05:28Z")
> [@coremelt](#): > > Well then all I can say is it sucks to be a US citizen, because I earn considerably less than $250k but I save a ton by being a company. Although I do have some employees, its not just a shell corp. So we should disregard everything you wrote because it doesn’t apply here? [Previous page](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969.md?page=3) [Next page](https://boards.straightdope.com/t/why-will-most-americans-never-become-mega-millionaires-or-billionaires/743969.md?page=5)