If you’ve ever wondered what it takes to officially “make it” in America, the answer depends on who’s asking and where they live. For some, success means a home with a yard and a reliable paycheck. For others, it’s breaking into that elusive top income bracket, the fabled 10% of earners. But here’s where things get interesting.
The salary that earns you bragging rights in one state might barely raise eyebrows in another. And as new data shows, joining the financial elite doesn’t always look like you’d expect.
What It Takes To Join The Financial Elite
The latest IRS and Social Security data show that the median American income is about $75,000 a year. To reach the top 10% of earners, you need roughly $149,000. The top 5% starts at around $352,000, while the top 1% begins near $749,000. The ultra-elite top 0.1% averages about $3.3 million annually.
Those numbers mark the thresholds to enter each group. Within those brackets, the averages look a little different because the IRS measures total income and the Social Security Administration measures wages only. For example, people in the top 10% earn an average of about $173,000, the top 5% average around $343,000, and the top 1% make roughly $824,000 in wages.
Income also varies sharply by location. In Connecticut and California, it takes close to $1.2 million to reach the top 1%, while in West Virginia, you’d cross that line with about $435,000. Geography, job markets, and cost of living all shape what it really means to be “wealthy” in America.
These numbers show a widening divide that’s been decades in the making. Since 1979, wages for the top 1% have grown nearly 180%, while pay for the bottom 90% has risen only about 28%. Age and education also influence earning power.
Workers in their mid-40s typically hit peak income levels, averaging around $70,000 a year, while younger workers in their early 20s make closer to $40,000. Education matters, too. A high school graduate earns around $49,500 a year, while a bachelor’s degree holder averages about $83,000, and those with advanced degrees top $100,000.
Income Doesn’t Tell The Whole Story
Image via iStockphoto/Sakorn Sukkasemsakorn
A six-figure paycheck might feel like a ticket to comfort, but the gap between income and wealth keeps growing. As of mid-2024, the top 1% of Americans hold about 23% of the nation’s total wealth, which is nearly triple what the middle 40% to 60% possess.
The top 20% collectively control more than 70% of U.S. wealth, while the bottom half share just 2.5%. That means most Americans, even those earning well, aren’t building wealth at the same pace as those at the very top.
High earners often face their own financial traps. Lifestyle inflation, heavy taxes, and large mortgages can make a six-figure salary feel tight. Meanwhile, many middle-income households build security through consistent saving and steady investing. Earning power can open doors, but how people manage that income determines whether they stay ahead or fall behind.