Did You Know that Business Ownership and Wealth are Strongly Related?
Lest there be any doubt, owning a business is still a major path to wealth in
the United States. According to data from the Survey of Consumer Finances, compiled
by the Social Welfare Research Institute at Boston College, in 1998 12.9 million
families owned one or more businesses that were not publicly traded on a stock
exchange. The median wealth of these families was $291 thousand and their average
wealth was $1,061 thousand. The median wealth for the 89.7 million families
that did not own a business was $56.4 thousand, and their average wealth was
$170.5 thousand -- less than 20% of the corresponding median and mean for business
owning families.
Not every family, not even a majority of families, that owned a business had reached millionaire status. However, owning a business greatly increased the odds of achieving millionaire status: 19% of families that owned a business had a million or more dollars in net worth as compared with 2% of families that did not own a business.
Another cut at the same issue is to examine 4.6 million families with a million or more dollars in net worth: 53% of families with a million or more in net worth owned one or more businesses as contrasted with 11% of families with less than a million dollars in net worth.
