Mean net worth of American household tops $1 million, up 23% from 2019

[essentialsaltes]

The average American household is now a millionaire, according to the Federal Reserve​

To be precise, the mean net worth of an American household, adjusted for inflation, was $1.06 million in 2022, according to the Federal Reserve's consumer finance survey.

In comparison, in 2019 the mean net worth of an average household was $868,000, marking a 23% jump.

Even when looking at the median—another measure of the average, which represents the midpoint in the ranking and is less likely to be skewed by exceptionally high or low numbers—the typical American household was worth $192,900.

Although that figure is less exciting for aspirational workers, it still represents an impressive after-inflation gain of 37% over three years.

 

[Vambram]

Interesting post.

 

[rambot]

Let's remember what "mean" is. It's the average of EVERYONE'S salary.

So, really what we are seeing is a fractional increase in the middle and a disgustingly huge increase at the 1% level.

I'm more curious about the median net worth. That's going to provide a FAAAAAAAAAAAAAAAR more realistic picture.

 

[essentialsaltes]

So, really what we are seeing is ... a disgustingly huge increase at the 1% level.

I wonder how that happens?

I'm more curious about the median net worth. That's going to provide a FAAAAAAAAAAAAAAAR more realistic picture.

Quoted in OP.

 

[rambot]

Quoted in OP.

Well that's embarrassing. I just have a very hard time believing that those numbers are truely meaningful of success though.

 

[essentialsaltes]

Well that's embarrassing. I just have a very hard time believing that those numbers are truely meaningful of success though.

The article does point the importance of homeownership, as home prices soared over that 4 year period. But having a house that's worth more doesn't put food on the table, so I agree that 23% rise in the median probably doesn't reflect how people are doing with respect to spending money/buying power.

 

[ThatRobGuy]

Let's remember what "mean" is. It's the average of EVERYONE'S salary.

So, really what we are seeing is a fractional increase in the middle and a disgustingly huge increase at the 1% level.

I'm more curious about the median net worth. That's going to provide a FAAAAAAAAAAAAAAAR more realistic picture.

You also have to consider that "net worth" can be a misleading metric.

Net Worth includes things like houses (or home equity), cars, 401k you can't touch yet, etc...and doesn't necessarily equate to readily accessible cash.

For instance, a person making $45k who bought a house when the market was advantageous for $165k at a fair interest rate, and are now sitting on a house that has a "market value" of $365k, that's $200k that toward their "net worth", but unless they're willing to sell their house (or borrow against it at unfavorable rates), that $200k of net worth isn't an active contributor toward the goal of cover bills and making ends meet.

 

[rambot]

Thanks you two. I'm not sure I wouldn't have been stewing on that one for a while.