This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

What Does it Take for Near Millionaires to Get There?

By Hal M. Bundrick

NEW YORK (MainStreet) You're this close to being a millionaire. Just can't seem to get over the hump into seven-figure heaven? Here's how to fix that and get that first Big One out of the way.

First, "near millionaires" will be defined for our purposes of discussion as having about $800,000 in total assets, with an average annual household income of $150,000. Fidelity did a study on this pool of prosperous investors and found that nearly half are women (49%) and Gen X/Yers (49%). That's As compared to most of today's millionaires, who are predominantly rich old guys, according to Fidelity. So the near millionaire club is inclusive. And growing. These investors are expected to amass $22 trillion and $41 trillion in assets by 2023, respectively.

What's holding them back from reaching the million dollar mark? Well, according to the study, 70% say that they are not very knowledgeable about investing. Think how well they would have done if they had just picked up an investing book or two.

And they are playing it too safe. The research says that while these seven-figure wannabes are on top of their financial basics, such as debt and household expenses, they are "not comfortable taking on risk to maximize returns."

More than three-quarters of those surveyed (77%) said they already have, or are currently managing, household expenses more closely, and 85% felt they've got personal debt under control. Saving for retirement is their primary goal, while increasing wealth was the runner up. More than one-quarter (27%) were looking to improve their returns on investments, though nearly half (45%) focus their investment strategies on reducing risk, minimizing loss and avoiding market volatility. The study found that cash, CDs and money markets make up the second largest asset category in their portfolios.

Financial advisors may be disappointed to learn of one overriding attitude these near millionaires share: 77% don't have a financial plan -- and 38% don't want one.

More bad news for money managers: with a large majority (70%) admitting a lack of investing knowledge, only about half (51%) are relying on financial advisors for help. Many believe advisors aren't interested in investors with assets of less than a $1 million, but most (53%) say it's simply a matter of avoiding fees.

However, they aren't without resources. Being tech-savvy, nearly as many of these investors use technology as much as they do an advisor for financial education.

--Written by Hal M. Bundrick for MainStreet

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,943.81 +28.74 0.17%
S&P 500 1,967.57 +2.89 0.15%
NASDAQ 4,415.49 +19.2860 0.44%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs