The Rise of the 'Everywhere Millionaire': How Ordinary Businesses Build Wealth

The Hidden Wealth of America

When you think of millionaires, images of Silicon Valley entrepreneurs or hedge fund managers often come to mind. But according to a new study by economists Owen Zidar and Eric Zwick, the most common path to wealth in the U.S. doesn't involve working for others. Instead, it's through business ownership — specifically, pass-through enterprises that provide unique tax advantages and allow owners to build substantial wealth over time.

This revelation challenges long-held assumptions about how Americans become wealthy. The research, based on detailed analysis of Treasury and IRS data, shows there are roughly 5 million U.S. households worth at least $5 million — combined wealth exceeding that of the Forbes 400 by more than 13 times.

"This is not just a story about wealth being on the coast, Silicon Valley and finance," Zwick, an economics professor at the University of Chicago Booth School of Business, told CBS News. "This is a much broader phenomenon, and also much closer to home for a lot of Americans."

These findings align with the 1990s bestseller The Millionaire Next Door, which highlighted that many millionaires were ordinary people who built wealth through careful saving and investing. However, the Zidar-Zwick study reveals a key difference: while the millionaires of the '90s often lived modestly, today's everywhere millionaires are more likely to enjoy luxury lifestyles — but still operate traditional, brick-and-mortar businesses.

Who Are These 'Everywhere Millionaires'?

The study identified several key characteristics of these wealthy business owners:

• Business Ownership: About three-quarters of these millionaires started their own businesses, with the vast majority not inheriting their wealth.
• Age and Demographics: The typical everywhere millionaire is 62 years old, married, and more likely to be a college graduate than the general population — though not by a large margin.
• Work-Life Balance: Despite being in their 50s or 60s, these business owners are often still actively involved in running their companies. They're not retired; they're still passionate about what they do.

One profiled millionaire, Dick Portillo, exemplifies this trend. Growing up poor in a Chicago housing project, he started a hot dog stand in 1963 with just $1,100. Over time, he built the business into a regional chain that was eventually sold to Berkshire Partners for $1 billion.

"Freedom, independence, is almost more important to a lot of them when they're starting — Portillo similarly — than 'Oh, this is going to make me hugely rich,'" Zwick said.

The Tax Advantage: Pass-Through Businesses

One crucial factor that has enabled many of these millionaires to accumulate wealth is the use of pass-through business structures. These include sole proprietorships, partnerships, and LLCs — entities where profits flow directly to the owner's personal tax return, avoiding corporate-level taxation.

This structure provides a significant financial advantage: owners can deduct up to 20% of their business income from taxes, effectively reducing their taxable earnings. In essence, it's a way to build wealth without the high tax burden that often affects W-2 employees or traditional corporations.

"You pay lower tax if you're getting your income through one of these businesses, even if your labor is going into running the business," Zwick told CBS News. "It has made them richer than they otherwise would have been, and it's an important part of the story of their growth over the last 40 years."

These tax benefits have played a pivotal role in helping business owners grow their wealth — especially when combined with hard work, reinvestment, and strategic decision-making.

Will AI Change This Equation?

With artificial intelligence transforming industries, it's natural to wonder if the path to wealth will shift. But according to Zwick, the fundamental truth remains unchanged: there are still plenty of real-world problems to solve, and opportunities for entrepreneurship exist in every corner of the economy.

"The problems that these people are solving are tactile, they're tangible — they're problems that people experience every day," he said. "Technology will change what these businesses look like, but these tactile, real-world problems are still going to be there. HVAC is still going to be a need."

Even with AI automation, the human element in business remains crucial — whether it's managing a restaurant chain, providing HVAC services, or building a local tech startup. The key insight is that the American Dream isn't dead; it's just taking new forms.

Revisiting the American Dream

Zwick argues that while many narratives focus on inequality and economic hardship, there's actually an undercurrent of opportunity that's often overlooked. These everyday entrepreneurs show that building wealth is still possible — not through stock market luck or inheritance, but through persistence, ingenuity, and smart financial choices.

"The prevailing narrative is very pessimistic relative to our reading of the data, but it's not necessarily where people are looking," Zwick added. "The American Dream is more alive than most people think."

As we navigate a rapidly changing economy, the story of the everywhere millionaire offers a compelling reminder that success doesn't always come from the headlines — sometimes, it comes from the quiet, steady growth of a business that never stops serving its community.