Here’s a remarkable statistic: The top 1 percent of the richest families in the U.S. own 32 percent of the total wealth, according to the Federal Reserve. And, according to data from Moody’s Analytics, the top 10 percent of earners account for 49.2 percent of all U.S. consumer spending.

When looking at expenditures on discretionary products, the top 10 percent of households ranked by income account for about 25 percent of that total spend, according to Bank of America.

All good news for the luxury market.

Here’s better news: The U.S. has millions of affluent households and a record number of multi-generational “mega-wealthy dynasties.” Forbes has reported a record 54 multi-generational families worth at least $10 billion each, holding a combined $1.9 trillion.

First, higher-income households can only buy so much. But more importantly, the luxury market is slowing down due to a loss of exclusivity, aggressive price hikes and a steep decline in Chinese consumer demand, as well as a shift in spending toward travel and experiences.

Regarding the price hikes, the increases have been in the double digits with European luxury brands climbing more than 50 percent between 2019 and 2024. As a result, middle-income and so-called aspirational consumers have been alienated. According to Bain & Co., more than 50 million aspirational shoppers have stepped away from the market.

In addition, over-expansion and a relentless push for volume have diluted the sense of rarity and exclusivity that defines true luxury, which is causing tens of millions of casual and younger shoppers to also walk away from luxury purchases.

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