Median net worth of wealthiest Americans stayed steady during financial crisis
Top earners weathered the storm
Rich steered clear of dramatic destruction of wealth during Great Recession
The nation’s wealthiest Americans saw their average net worth fall 15.3% from 2007 to 2010, mostly because of a drop in real estate and business values during the recession, according to a new government survey.
The decrease was greater than the 14.7% drop in the mean net worth of the nation as a whole, according to the Federal Reserve’s Survey of Consumer Finances, released Monday. However, the median net worth of the richest 10% of Americans remained steady over the three years while the median net worth of Americans as a whole fell a whopping 38.8% in 2007-10.
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The government report is the only survey that does not miss the top 5% of earners, said Barry Bosworth, a senior fellow at the Brookings Institution. This study employs special procedures to interview the wealthiest individuals, whose characteristics are commonly missed because they tend not to answer questions about themselves, Mr. Bosworth said.
The top 10% of wealthiest Americans also saw their sources of income shift over the three-year period. Their income from realized capital gains fell from 14.4% of their income in 2007 to 2.3% of income in 2010. Income from wages and salaries rose from 46% of their income in 2007 to 55% in 2010. Income from retirement assets for the wealthiest families increased from 6.2% to 7.8% over the three years.
The number of families who said they had saved money in the preceeding year fell from 56.4% in 2007 to 52% in 2010.
“That decrease pushed the fraction of families reporting saving to the lowest level since the SCF began collecting such information in 1992,” the report said.
Retirees were the only group that reported saving money during the period. The data did not measure whether they were saving more or less than in the past.
The information also suggests less has been saved for eduction, while more has been borrowed for the cause. The ownership of tax-deferred accounts such as 529 college savings plans dropped nationally, from 3.8% in 2007 to 2.9% in 2010. Among those with education debt, the mean dollar amount increased 14% from $22,500 to $25,600.
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