Thursday, March 24, 2011

How Much Did Net Worth Fall?

The answer: 23 percent.

The Great Recession reduced median household net worth by 23 percent, according to the long-awaited update of the 2007 Survey of Consumer Finances. This unprecedented update was undertaken by the Federal Reserve Board solely to determine the impact of the Great Recession on household net worth, assets, and debt.

Median household net worth fell from $125,400 in 2007 to $96,000 in 2009 (in 2009 dollars). The decline in wealth occurred across the board, affecting nearly two out of three households.

The biggest reason for the decline in wealth was the loss of housing equity, which is the single largest asset owned by the average household. The median value of owned homes fell from $207,100 in 2007 to $176,000 in 2009 (in 2009 dollars). Unfortunately, the decline in housing values continues.

Source: Federal Reserve Board, Surveying the Aftermath of the Storm: Changes in Family Finances from 2007 to 2009

1 comment:

psikeyhackr said...

What has the depreciation of automobiles done to American's Net Worth over the last 50 years? When do economists compute that?

They don't mention planned obsolescence either. They just forgot.

There were 200,000,000 cars in the US in 1995. At $1500 in depreciation per care per year that is $300,000,000,000 per year. A bit much to forget.