It’s true. An estimated 35 to 45 percent of wealth is inherited rather than self-made.
https://www.brookings.edu/blog/social-mobility-memos/2015/01/30/wealth-inheritance-and-social-mobility/
And yet
https://inequality.org/research/selfmade-myth-hallucinating-rich/
https://www.theguardian.com/us-news/2018/jan/29/rich-people-wealth-america
Could that be caused by our frontier and immigrant origins that glorify being self made- “My grandfather came to the US by rowboat with only $.02 cents in his pocket only speaking a dying language and he became a doctor.” narrative that we too often see.
Even in this thread there was a poster who claimed they are self made.
As a country we admire that trait and tend to think that someone in difficult economic circumstances is doing something wrong. Shoulda stayed in school! If you stopped smoking there would be money for x! Just get a job!
All this brushes right past a family’s history with mental illness, a disabled child, schools that prioritize teaching religion in science class, lack of access to libraries…
edited to add: Oh snap! Marvin was already on the case.
Beyond direct inheritance of wealth, note that parental wealth enables the parents to offer better opportunities for their kids to earn merit, and remove barriers. Obviously, the kids still have to earn the merit, but they have limited competition from others whose parents could not afford to offer their kids an opportunity-rich environment (e.g. being able to pay for the house in the better public school area, or the cost of a good private school, or the cost of a travel sports team or other extracurricular, or test preparation in the college admissions game).
It is not a surprise that the most selective private colleges’ students are heavily skewed to those from the highest income (no FA) groups. And that suggests that the “elite” jobs that see admission to those colleges as desirable merit are effectively including an aristocratic component in their selection.
Meant to be a PM
@“Snowball City” Wait, are you saying there are not people who are self made? That’s crazy. In my very affluent town, many I’d say 20-40% of people were born in another country. Many came with very little as students and are now citizens. They teach their kids differently than US born parents. And their expectations and jobs are different ( many more entrepreneurs, doctors and jobs with high education). Everyone I know who works and is in the 1-5% range is self made ( maybe a handful of those who were born wealthy and work in professional jobs with high pay). The rest are very much self made AND risk takers. They pass on the work ethic to their kids also.
@ucbalumnus That is definitely true. Parents who make a lot spend a lot on their kids’ enrichment. Over time, I’d bet it’s several hundred thousand dollars before the kid gets to college. So there are advantages for these kids. That doesn’t mean every parent doesn’t give their kid what they can. Most parents will spend as much as possible on their kid ( whatever that means to them).
It’s interesting how hard people fight the idea they are rich. If you are in the top 2-3% of all earners, you are rich by any objective measure. This is true even if don’t start earning that until your 40s.
Regarding “self made”, note that there are gradations of that (and inherited), as the Forbes self made score of 1 to 10 suggests.
For example, self made from an advantaged high opportunity environment can mean something different from self made from a disadvantaged low opportunity environment. Of course, parents with resources prefer the former for their kids to maximize their chance of success, but those who earned merit starting from advantage and opportunity should realize that not everyone has the same opportunities to earn merit.
This link seems to undercut Forbes on that to some extent:
https://inequality.org/research/selfmade-myth-hallucinating-rich/
“It’s interesting how hard people fight the idea they are rich”
People can be rich, but not “feel rich”. That’s not fighting “the idea they are rich”. It’s just that they don’t feel secure.
So some sort of financial dysphoria?
Typical arm chair quarterback discussion on CC many do feel rich, but the data is quirky as usual like college stats lol.
Say in Texas where the top 1% is IDK 425K (don’t feel like looking for exact #) the avg of the top 1% is almost 1 million per year in income. I guarantee those people feel wealthy. I even guarantee the bottom of the barrel people feel wealthy in Texas, La, Miss, Ala, Ark, etc.
Go to the Northeast and West coast and 480k/yr isn’t a ton of money in a house of 6 like mine. It is a nice chunk, but good schools, 1 family trip a year, retirement, a 2500/sq ft house, et etc it just isn’t a “RICH KIND OF MONEY”
I think feeling rich and being a 1%'er is totally dependent on where you live in this great country and where you are in that 1%.
Yes, if you define “rich” as “the top 1%” you’re going to get very quirky data, because that’s an unrealistic and idiosyncratic (or, um, “quirky”!) definition. Anywhere in the US, $480k is rich, even for a family of six. In Boston and New York, for instance, it puts you solidly in the upper class, @emptynesteryet . If you want to check for yourself, you can use this link (it appeared earlier in the thread as well):
http://www.pewresearch.org/fact-tank/2018/09/06/are-you-in-the-american-middle-class/
That was from 2012… Forbes subsequently (2014) created a self-made score from 1 to 10 (1 = pure inheritance, 10 = self-made from poor disadvantaged beginnings; see https://www.forbes.com/sites/afontevecchia/2014/10/02/the-new-forbes-400-self-made-score-from-silver-spooners-to-boostrappers/ ).
Now if you look at its 400 richest people, you can look at the self-made scores: https://www.forbes.com/forbes-400/list/ . Note that 8 is a common score (self-made from middle or upper middle class), but 9 (self-made from working class) and 10 (self-made from poor and disadvantaged) are significantly less common.
For those in more ordinary levels of income and wealth, the scores most relevant would be 7 to 10. It should not be surprising that 8-equivalent is quite a bit more common than 9- or 10-equivalent among highly successful (income and wealth wise) people.
Thanks–that’s helpful. That said, “self-made from middle or upper middle class” represents a redefinition of “self-made” with which I disagree.
Presumably, you would only count a 10 score or equivalent as “self-made”?
If “self-made” were limited in that way (as opposed to qualified by starting point), then would there there be a convenient short way of describing someone who earned (rather than inherited) his/her achievements (financial or otherwise), but did so starting from a generally advantaged high opportunity starting point (8 score or equivalent)?
As to retirement, you can always pick up and move from the NE to Texas or Arkansas.
Plenty of places one could live quite nicely on $480K per year in the NE and on the West Coast.
Sure, I think “from middle or upper middle class” would do nicely 
“So some sort of financial dysphoria?”
Yes that’s a pretty reasonable assessment. Just like “I’m not pretty” or “I’m not smart” when by objective standards you are perfectly OK. Or worrying that the country is going to hell, when by Venezuelan standards it most certainly isn’t. Or worrying that you won’t get into a good college…
People like to worry. Media (news, advertising, social media, etc.) is designed to stoke those fears because it attracts eyeballs.
In any place in the US all one has to do is try to live on the median income for that area to perhaps suddenly feel rich at 480K.
A quick google search shows the median income for:
San Fran = 78K
Los Angeles = 56K
Boston = 103K
DC = 76K
Manhattan = 67K
And that’s median household income (including more than one earner if in the household). Half have less.