By Nathalie Voit

U.S. household wealth skyrocketed in 2021 as double-digit stock market returns and newfound crypto wealth pushed the number of new millionaires in the country to over one million, according to a new study from wealth research firm Spectrem Group released on March 17.

The number of Americans holding $1 million or more in investible assets soared from 13.3 million in 2020 to a new high of 14.6 million in 2021. The growth rate of over 10% was the highest in years, according to CNBC.

“It was the strongest year ever for millionaire creation in all segments,” said President of Spectrem Group George Walper in the report.

The largest gains floated to the top, with the richest Americans seeing the greatest financial returns over the year. The Chicago-based firm said the number of new individuals belonging to the very top (those holding investible assets of $25 million or more) grew from 214,000 in 2020 to 252,000 in 2021, or by about 18% over the year. In contrast, the number of “mass affluent” households (those with a net worth between $100,000 and $1 million) grew by just 2%.

The number of so-called “ultra-high net worth” investors (those with a household net worth between $5 million and $25 million) increased from 1,630,000 at year-end 2020 to 1,800,000 by year-end 2021, or 10.4%.

The bullish stock market was the primary driver of wealth creation over the year, according to data from the Federal Reserve. Major stock indices posted double-digit gains for the year, including the S&P 500 (+26.9%), the Dow Jones Industrial Average (+18.7%), and the Nasdaq Composite (21.4%).

However, massive gains were also reported across the crypto market as the overall market value of cryptocurrencies ballooned by about $1.5 trillion in 2021 to around $2.3 trillion by year’s end, according to data from CoinGecko. Increases across all types of assets, particularly those with higher risk and greater reward, helped concentrate the majority of wealth creation at the very top.

“The wealthy have the greatest exposure to the broadest investments,” Walper said. “It wasn’t just traditional liquid markets that did well last year. It was also alternative investments, real-estate investments, and crypto.”

The unequal wealth gains helped widen wealth inequality in the country. The share of wealth held by the top 1% of U.S. households surged to a whopping 32% last year, according to the Fed.

Regarding the economic outlook for 2022, the president painted a bleak picture of the year, noting financial markets had already tumbled dramatically in response to the crisis in Ukraine, ongoing inflation, and surging fuel prices.

“Every day changes, so it’s hard to predict where the year will wind up,” Walper said. “But the first few months of 2022 have already painted a different picture than 2021.”