It’s a great time to be a billionaire

As near as we can figure, once you’re a billionaire, it’s pretty much impossible not to be a billionaire. Once they’re in the six-comma club, billionaires make money hand over fist pretty much by not doing much.

Take Glen Taylor, the owner of the Star Tribune, Minnesota Lynx, Minnesota Timberwolves, some farms, and a printing company or two.

Just in the time between when Forbes released its annual ranking of billionaires today, and lunch time, Taylor’s worth increased by another $100 million, according to Forbes.

That’s a pretty sweet gig, even though Taylor is practically the help on the list, coming in at #924th in the world with a worth of about $2.6 billion. Jeff Bezos is #1.

The richest Minnesotan on the list is the same person it’s been practically since they started printing money: Whitney McMillan, the scion of the Cargill clan, who is estimated to be worth $6.1 billion, $1.6 billion more than just three years ago. That makes him the world’s 289th richest person.

McMillan could set fire to a $100 bill every minute for the next 116 years and he still would have a hard time not having a fortune.

Inexplicably, two Minnesotans have disappeared from the list. Marilyn Carlson Nelson and Barbara Carlson Gage were worth $1.1 billion as recently as 2015. But the children of the man who started a travel company have fallen out of the club.

  • That Money Grab, er, “Tax Cut for the Middle Class” will help them as well. it’s nice to see the rich getting richer.

    At least the masses get to eat cake.

  • jon

    I’d settle for a mere hundred million (after taxes), come on powerball!

    Heck I’d settle for a mere 5 million after taxes…. which I think is the line for F-you money* now… 1% return on 5 million is 50K a year, that’s median household income money, and a more realistic 4-5% (after inflation) would get you a health 200-250K… since happiness levels are mostly peaked around 150K a year in the studies I’ve seen it seems like aiming just above that is a healthy target…

    *The point at which you can just say “F-You” to your boss and walk out.
    (Though I’d probably keep working for a while at least… probably a year(ish) until things settled and I had a stable income from investments rolling in…)

    • Agreed…I’ve run that scenario through my head a few times. Just live off the interest / investments.

    • Jack

      Wait – what about health insurance? That’s what keeps me employed.

      • jon

        I’ve had to explain this to multiple people now in the past few months… You can use money to purchase health insurance. It would cost about $10k a year for me and my wife according to the MN website (thanks Obama)…

        Let’s say you make median household income, $50k a year and your married(for with my insurance cost estimate above for me and my wife), you are working for health insurance so of course you max out HSA contributions (~$7k) Government is going to take about $6k so that leaves you with $36k in cash and $7 in HSA money (that can be used to pay premiums… That’s 4 years of health insurance, no investments needed. Invest it as you go in an index fund (generally average a 10% annual return) you can stretch it to 5-6 years…

        That’s not even playing the accounting games which are also options when you get into healthcare spending…

        • Jack

          Based on our age and pre-existing conditions, our premiums would be much higher. Throw in a couple years of maxing out of pocket medical expenses (because we just never know) and I’d say we would need a lot more than 5 million to make it through to retirement.

          Back years ago we were on individual policies (anyone else remember when jobs didn’t come with health insurance coverage?) and the carrier was always ready to drop us if we messed up on the premium payment.

          I’ve not gone on the MNSure website, but how does it work when you have high assets but low income? I would think that they would price the policy accordingly but I could be wrong.

          • Went to retirement seminar recently and the one statistic that caught my attention was “80% of retirement savings is spent in the last 18 months of life.” Not sure if that’s true. Sounds plausible.

          • jon

            I think the statistic was that a quarter to half of lifetime healthcare spending is spend in the last year of life (for most people).

            But that measure was based on total cost, not out of pocket costs….

          • Jack

            Wouldn’t surprise me. I know folks who have parents in nursing homes now and the costs are really high. Throw in health care and that might be right.

          • jon

            Go to the MNsure site and punch in some information (or something close to your information) and you can see how much money it would cost, and what the max out of pockets would be… I think determining if you qualify for federal assistance is a little more involved than getting the total cost though.

            As for age and pre-existing conditions, they shouldn’t matter as much as you’d think after the ACA went into effect.

  • MrE85
  • Rob

    Gilded Age 2.0

  • Doug

    When I was growing up, ah, mumble mumble years ago, a millionaire was considered very rich. Billionaire wasn’t even a reality. Now, no one pays much attention to millionaires, it’s all billionaires. Even taking inflation into consideration, how did we jump from millionaires to billionaires?

  • Noelle

    //McMillan could set fire to a $100 bill every minute for the next 116 years and he still would have a hard time not having a fortune.

    Just…ugh. These stats really put the imbalance in perspective.

  • Kellpa07

    Of course it would be great to be a billionaire, but I’d much rather be in the middle 40% of the wealth holders in the US today than the top 5% 100 years or more ago.

    • Ralphy

      I’m pretty confident the descendants of Rockefeller, Vanderbilt, Carnegie, Astor etc. will live an extraordinarily comfortable life into perpetuity.

      Of course, money can’t buy happiness. But it can alleviate pain.

      • Taylor, I should point out, is the only Minnesotan on the list from working background. The others got their fortune the old fashioned way.

        • >>The others got their fortune the old fashioned way.<<

          Political kickbacks?

        • I remember the blue steel-sided building next to SH 169 in North Mankato where his early printing business took hold. Now the main operation is up “on the hill” in North Mankato. It’s a great asset for the Mankato area, and MSU has benefitted from his generosity.

        • Kellpa07

          The top 13 on the US list all made their billions by starting companies. The next 3 all had the good sense to be Sam Walton’s kids, but I think they all worked for the company too. The US list is long. I wonder what portion of them earned, rather than inherited their money.

          • And how many got the jobs to “earn” their money because they were family.

  • Jack Ungerleider

    Because there are numbers in this article and I like me some recreational mathematics lets just do some math on Mr. Taylor’s increase in net worth. (Another name for this is Recreational Math for Politicians.)

    So his worth increased by $100,000,000 in a short period this morning if I’m reading it right. Based on the reported total net worth that’s about 3.8% addition. Let’s say we go back to the Kennedy tax cut where the top marginal rate is 70%. Let’s also say that the top rate kicks in at $50,000,000. So the last $50,000,000 of that addition is taxed at 70% so that removes $35,000,000 from Mr. Taylor’s pocket. That $35,000,000 is 1.3% of his total net worth. I believe 1.5 cents on the dollar is less than pocket change. For the Government to take in that amount of money from people who are taxed an additional $100 dollars would be about halfway between the population of St Paul and Minneapolis. (350,000)

    Before someone talks about the lower marginal rates and the other money that is taken from that $100,000,000 I understand its there. But this is my exercise and we’ll do it the way I say. But here’s the thing, we know that the existing marginal rates are lower so the numbers will be less than what we have here.

    So if you are concerned about deficits and debt, you are better off going where the money is to pay it off and then rework the tax code to something you think is “fair”.

    • Kellpa07

      You could take all the money from all the US billionaires, and it may make a dent in the deficit, it would hardly register on the debt. And after that, what?

      • We stop starting wars?

        • Kellpa07

          That’d be a good start.

      • Jack Ungerleider

        One of the takeaways from this article is that wealth in and of itself is a wealth generator. (A feed back loop of sorts.) So I would never suggest taking all of the billionaires money. I think what I said was take the pocket change from the feedback loop. Even with the extra tax on the $50 million you have at least $65 million minus the current tax profile to generate more money. I’m no tax expert but it seems to me we give more breaks to people who “lose” money than we get payments from people who “make” money. As a result a lot of wealth creation that should be taxed in some fashion isn’t and society, embodied in their governments, have less funds to do what people want. But since people want services the government goes into debt to provide what the people want.

        Why should the rich foot the bill for social services? The flippant answer is because they have the money. The serious answer is, because they have the money. What is the result if we don’t do this? One word: Revolution (see Revolution, French and Revolution, Bolshevik for more illustrative examples.)

  • Frank

    My income is very comfortable. Wife and I have substantial savings, financial and real estate investments. Kids educations are paid off.

    I really couldn’t care less how much more anyone else has, but hope they’re enjoying life as much as we are…That’s my definition of financial freedom.

  • bri-bri

    As far as I know there are no quintillionaires ($1,000,000,000,000,000,000), so no one’s in the six-comma club yet! You only need three commas to be a billionaire ($1,000,000,000).

    Suddenly, being a millionaire seems pretty easy: it’s just one comma away!

    • LieutenantLefse

      In fact the entire economic output of the human race so far only requires five commas.

      https://xkcd.com/980