Tuesday, June 12, 2012

The Rich Really Are Getting Richer

The latest data on household wealth is bad news for everyone except the rich. The net worth of households with the highest incomes grew 2 percent between 2007 and 2010 while everyone else lost their shirts, according to the Federal Reserve Board's Survey of Consumer Finances. Overall, median household net worth fell 39 percent between 2007 and 2010--to $77,300, after adjusting for inflation.

Take a look at median household net worth in 2010 by household income percentile, and the percent change since 2007 after adjusting for inflation...

Percentile of household income
Less than 20: $6,200 (-27%)
20 to 39.9: $25,600 (-35%)
40 to 59.9: $65,900 (-29%)
60 to 79.9: $128,600 (-40%)
80 to 89.9: $286,600 (-23%)
90 to 100: $1,194,300 (+2%)

Reports of the death of the middle class have not been greatly exaggerated. Households with incomes in the middle of the distribution (ranging from the 60th to the 80th percentile) lost the most--a 40 percent decline in net worth between 2007 and 2010. 

Source: Federal Reserve Board, Federal Reserve Bulletin, Changes in U.S. Family Finances from 2007 to 2010: Evidence from the Survey of Consumer Finances

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