How Much Income Puts You in the Top 1%, 5%, 10%?

You'll need to make at least six figures per year

When you read all those stories about the 1%—or even the top 5% or 10%—it may raise the question: How much money do you need to pull in to be in one of those groups? You'll need at least six figures to count yourself among the nation's top earners.

Key Takeaways

  • You’ll need to pull in at least six figures to be a top earner.
  • Historically, the wealthiest have grown richer much faster than the rest of the population.
  • Income disparity is highlighted among the top and lowest earners in terms of how much the distribution of wages has changed since 1979.

How to Make the Top 1% List

According to the Economic Policy Institute, the average annual wage of the top 1% was $823,763 as of 2020. A more recent study by SmartAsset points out that the national average of the top 1% earners is $597,815. Have in mind that the figures vary greatly from state to state.

Annual Wages of Top Earners

The data from the EPI show that in 2020 annual wages for the top 1% reached $823,763, up 7.3% compared to 2019. How much do you need to earn to be in the top 0.1%? A hefty $3,212,486, which is almost 10% more than that group earned a year before. Wages for the bottom 90% rose at a much more modest rest of just 1.7% over the same period, with an average income of $40,085.

2020 Average Annual Wages
Group Avg. Wages
Top 0.1% of Earners $3,212,486
Top 1% of Earners $823,763
Top 5% of Earners $342,987
Top 10% of Earners $173,176

Historically, the rich have become richer faster than the rest of the population. EPI research has found that since 1979, the top 1% saw their wages grow by 179% and the top 0.1% by more than twice as much⁠—389%. Wages for the bottom 90% only grew 28% in the same time period.

The latest figures were drawn from Social Security Administration data, allowing EPI researchers to estimate wage trends in more precise segments and to measure trends.

The study is about wages, not income as a whole⁠; it does not include investment income, for example, which is not part of Social Security data.

Impact of the Financial Crisis

During the financial crisis from 2007 to 2009, wages fell furthest among the top 0.1% and 1% of earners. In 2020, the top 0.1% had still not yet bounced back to what they earned in 2007.Among the top 5% of earners, wages grew 13.4% since 2007, the year before the Great Recession. Those in the top 10% saw 16.5% growth.

In the decade since the recovery from the Great Recession (2009-2019), the bottom 90% saw annual wage growth of just 1.7%, compared to the top 1.0% and top 0.1%, which experienced 11.2% and 5.8% growth, respectively.

Impact of the COVID-19 Pandemic

Even as the coronavirus pandemic wiped out jobs and created hardship for many Americans, the well-off have continued to amass wealth. The richest 1% of American households added about $4.5 trillion in wealth from the end of March to the end of December 2021. And Federal Reserve data shows that as of 2021, the top 1% of earners now hold 27% of the nation's wealth, a larger share than the 26.8% held by the middle 60% of U.S. households (often used to define the middle class by economists).

Income Disparity

Income disparity is the most dramatic when you look at how the distribution of wages has changed since 1979. As the EPI reports: "The bottom 90% earned 69.8% of all earnings in 1979 but only 60.2% in 2020. In contrast, the top 1% nearly doubled its share of earnings from 7.3% in 1979 to 13.8% in 2020." The EPI also points out that the top 0.1% more than tripled their share of earnings to 5.4% in 2020 from 1.6% in 1979.

Are the Rich Getting Richer?

Yes. Between 1979 and 2020, the wages of the top 1% grew by 119.2%, while the rate of growth for those in the top 0.1% was more than twice as high: 389.1%. Compare that to the 28.2% growth for those in the bottom 90% during the same period. According to the Economic Policy Institute, “The upward distribution of wages from the bottom 90% to the top 1.0% that was evident over the period from 1979 to 2019 was especially strong in the 2020 pandemic year, yielding historically high wage levels and shares of all wages for the top 1.0% and 0.1%.”

How Much Would I Have to Make to Be in the Top 0.1%?

Your annual wage would have to be almost $3.21 million. This is an all-time high as of 2020, and 2021 looks to set another record.

How Many Billionaires Are There?

According to the 2022 Forbes annual wealthiest list, the number of billionaires in the world decreased by 87. And 1,000 of them are richer than they were a year ago.

The U.S. has more billionaires than any other country: 735. China, including Hong Kong and Macao, is close behind with 607. Highlighting a racial wealth gap, only eight of America's billionaires are African American: businessmen Robert F. Smith and David Steward, Oprah Winfrey, Kanye West, Rihanna, Michael Jordan, Jay-Z, and Tyler Perry.

The Bottom Line

To be a top earner in the U.S., you’ll need to make at least six figures. The wealthiest have grown richer much faster than the rest of the population since 1979. Income disparity stands out in particular among the highest and lowest earners in regards to how the distribution of wages has changed since then.

Article Sources
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  1. Economic Policy Institute. “Wage Inequality Continued to Increase in 2020.”

  2. SmartAsset. "What It Takes to Be in the 1% By State – 2022 Study."

  3. Social Security Administration. “Social Security Wage Statistics for 2018.”

  4. Board of Governors of the Federal Reserve System. “Wealth by Wealth Percentile Group.”

  5. Board of Governors of the Federal Reserve System. “Wealth by Income Percentile.”

  6. Forbes. “Forbes World’s Billionaires List.”