The term “ultra rich” is generally used to describe individuals with a very high net worth. There is no universally agreed upon threshold for how much money someone needs to be considered ultra rich, but most definitions start in the hundreds of millions or billions of dollars.
What is the Net Worth to be Considered Ultra Rich?
Here are some common benchmarks used to define ultra rich:
- $500 million+ net worth
- $1 billion+ net worth
- Top 0.1% of global net worth
- Top 0.01% of global net worth
According to the 2022 Forbes Billionaires List, you need a net worth of at least $2.9 billion to make the top 500 richest people in the world. However, a more inclusive definition starts at around $500 million.
How Many Ultra Rich Are There?
There are approximately:
- 744 billionaires worldwide (Forbes 2022)
- 2,660 UHNWIs (ultra high net worth individuals) with $500 million+ net worth globally (Wealth-X 2022)
- 62,500 UHNWIs with $30 million+ net worth globally (Capgemini 2022)
So while billionaires get a lot of attention, there are far more individuals with $500 million to $1 billion in net worth that could also be considered ultra rich.
What is the Average Net Worth of an Ultra Rich Person?
According to Wealth-X’s 2022 Billionaire Census:
- The average net worth of the world’s billionaires is $3.7 billion.
- The average net worth of billionaires in North America is $5.7 billion.
- The average net worth of billionaires in Europe is $4.3 billion.
- The average net worth of billionaires in Asia is $3.4 billion.
So while the threshold for being considered a billionaire is $1 billion in net worth, the typical billionaire worldwide has a net worth well above that.
How Did the Ultra Rich Earn Their Wealth?
According to Wealth-X, the major sources of wealth for billionaires are:
| Source of Wealth | Percentage of Billionaires |
| Finance & Investments | 15% |
| Manufacturing | 14% |
| Technology | 13% |
| Fashion & Retail | 10% |
| Food & Beverage | 8% |
| Media & Entertainment | 7% |
Ultra high net worth is often achieved through building massive companies in industries like finance, technology, manufacturing, and retail. Many billionaires are also self-made rather than inheriting their wealth.
Wealthiest People in the World
Here are the 5 wealthiest people in the world currently according to Forbes (in billions):
- Elon Musk – $219
- Jeff Bezos – $171
- Bernard Arnault – $158
- Bill Gates – $129
- Warren Buffet – $118
Elon Musk is currently the world’s richest person with a net worth over $200 billion. Jeff Bezos was the richest until 2021, and Bill Gates held the top spot for many years prior. The ultra wealthy tend to accumulate their net worth from ownership of companies like Tesla, Amazon, and Microsoft.
Wealthy Dynasties
Some ultra rich families have passed down and maintained their wealth for multiple generations, creating wealthy dynasties. Examples include:
- Walton family – heirs to Walmart fortune
- Koch family – Koch Industries conglomerate
- Mars family – Mars candy company
- Van Damme, De Spoelberch, de Mevius – Heirs to AB Inbev beer fortune
Dynastic wealth allows families to preserve billions in net worth across generations through inheritance and family business ownership.
Where Do Most Ultra Rich People Live?
According to Wealth-X’s 2022 Billionaire Census, the countries with the most billionaire residents are:
- United States – 735 billionaires
- China – 607 billionaires
- Germany – 174 billionaires
- Russia – 117 billionaires
- Hong Kong – 71 billionaires
The US has the most billionaires by a wide margin. New York City, San Francisco, Los Angeles, Miami, and Houston have some of the highest concentrations of billionaires globally.
Asia is rapidly gaining billionaires, led by China. Europe is home to many long-standing family fortunes and billionaire wealth.
Are the Ultra Rich Getting Richer?
The ultra wealthy are accumulating massive amounts of new wealth:
- Global billionaire wealth increased by $2.5 trillion to $12.7 trillion in 2020 alone (Forbes).
- The world’s 10 richest billionaires have doubled their collective net worth since March 2020 (Forbes).
- The top 1% captured 38% of all additional wealth created globally between 1995-2021 (World Inequality Report 2022).
Pandemic stimulus policies, strong markets, and growing technology company valuations have all contributed to explosive billionaire wealth growth in recent years.
This wealth concentration has also increased inequality. The world’s billionaires own 3.5% of global household wealth, up from around 2% in 2000 (Credit Suisse). Their share of global wealth is growing faster than their numbers are increasing.
Impact of Inflation
Inflation does not negatively impact billionaire wealth the way it hurts ordinary households. Billionaires tend to have assets like stocks, real estate, and investments that rise in value during inflationary periods. Wage growth for regular people has not kept up with rising prices.
In 2022, 573 billionaires added $1 trillion to their collective net worth even as average consumers struggled with high inflation (Forbes). Their companies and assets benefit from rising prices.
Are Billionaires Paying their Fair Share of Taxes?
Critics argue billionaires exploit tax loopholes to pay low effective tax rates:
- The average U.S. billionaire paid 8.2% of their adjusted gross income in federal individual income taxes between 2010-2018, compared to over 14% for average Americans (White House).
- The true tax rate billionaires pay might be even lower due to unrealized gains – for example, Tesla stock Elon Musk hasn’t yet sold.
- Wealthy individuals can use deductions, charitable donations, and other tax minimization strategies.
Supporters counter that billionaires pay capital gains taxes when they sell stock, and provide jobs, philanthropy, and productive investments.
Nonetheless, the ultra rich have seen taxes on capital like stocks and property decline in many countries. Calls are growing to tax wealth, not just income, at higher rates for billionaires.
Wealth Tax Proposals
Some examples of proposed wealth taxes on billionaires include:
- 3% annual tax on wealth over $1 billion (Elizabeth Warren)
- 1% annual tax on wealth over $20 million (Ron Wyden)
- Up to 5% annual tax on wealth starting at $50 million (Bernie Sanders)
Actual implementation would be complex. Wealth taxes were abandoned in Europe for issues like capital flight. But proponents believe higher wealth taxes can raise substantial revenue to address public needs and inequality.
Does Ultra Wealth Undermine Democracy?
Critics argue extreme billionaire wealth corrupts democracy:
- Wealth translates into political influence through donations and lobbying.
- Billionaires can sway public opinion and the policy agenda through their control of media outlets and organizations.
- The ultra rich have access to power and opportunities unavailable to ordinary citizens.
- Vast inherited wealth creates aristocratic dynasties at odds with meritocracy.
In this view, democracy requires more equal distribution of wealth and power. Others contend policies like transparency, ethics rules, and public financing can mitigate special interest influence.
Responses from Billionaires
Many billionaires and supporters object to populism and wealth redistribution:
- They argue extraordinary wealth derives from creating value, product innovation and building companies.
- Philanthropy can also fund social programs more efficiently than government bureaucracy in their view.
- Billionaire political activity is valid free speech, not corruption.
- Excess taxation removes incentives for aspiration, effort and capital investment.
Nonetheless, billionaire influence on policy raises concerns. Taxes, regulations, and transparency rules aim to balance wealth creation, power, and fairness in society.
Conclusion
In conclusion, ultra rich generally refers to individuals with a net worth starting in the hundreds of millions or billions of dollars. While the exact threshold is debatable, there are over 2,000 billionaires and 10s of thousands more centi-millionaires and deca-millionaires globally who could be considered ultra high net worth.
These individuals often accumulate great fortunes through finance, technology, retail, and other industries. Wealth concentration at the very top has increased in recent decades, but so have calls for billionaires and the ultra rich to pay higher wealth and income taxes. Their political influence from vast resources also raises concerns about democracy and inequality.
There are no easy answers on the proper role of billionaires and the ultra rich in society. Most agree that a system rewarding skill and contribution is good, but extremes of wealth concentration risk undermining social cohesion, fairness and economic mobility. The policy challenge is striking the right balance between wealth creation, taxation, philanthropy and democracy.
