According to a new study conducted and released by NFO WorldGroup, a Greenwich, Connecticut-based business research firm, the number of American millionaires is dwindling. The survey reveals an 11% decline in U.S. households with $1 million or more in investable assets to 3.3 million in June 2002, compared to 3.7 million in June 2001. This drop marks the first in more than a decade, according to NFO.

“The decline in the equity markets finally caught up with these households,” says David Thompson, director of affluent research for NFO Financial Services, a division of NFO WorldGroup. “The number of wealthy had been increasing steadily for ten years and then plateaued in 2000 and 2001.”

Thompson adds that the reason the decline in millionaires lagged other income levels is because this group tends to maintain more diversified portfolios that include a larger percentage of non-liquid assets such as real estate, giving them some cushion for loses. “But there was no holding back this past year,” he says. “There was carnage, and it took its tool.”

The report also suggests that there has been a parallel decline in millionaires’ financial confidence. NFO’s Affluent Confidence Index, which measures wealthy Americans’ sentiments toward their personal finances and the overall economy over the subsequent six months, fell from 16.2 in 2001 to 15.5 this year. “We’ve seen some shift in attitude toward investing,” says Thompson. “In the ’90s the focus was on asset accumulation, and many advisors took advantage of it and didn’t spend time on wealth transfer services.” Now, he says, “people are more risk averse, more conservative, and are leaning more toward wealth preservation.”

Interestingly, not all segments of the affluent market fared as poorly as the million-plus group, the study reports. The number of “mass affluent” households with net worths between $500,000 and $1 million declined only about 1% to approximately 3.5 million in 2002 from 3.6 million in 2001. Conversely, the number of households with more than $5 million in investable assets showed a modest increase, from 480,000 to 483,000.