Fed Says Families' Net Worth Grew "Strongly"
January 19, 2000
A new and detailed report from the Federal Reserve based on the two most recent Surveys of Consumer Finances reveals that the nation's longest run of prosperity pushed more households into the upper middle class, and strength in stocks showered benefits on all but those with the lowest incomes.
The report surveyed the finances of 4,000 families in 1998 and compared the data to similar surveys in 1989, 1992 and 1995.
- Median family income before tax rose slightly from $32,800 in 1989 to $33,400 in 1998 -- but median net worth climbed strongly from $59,700 to $71,600 during that period.
- The proportion of families with either indirect or direct stock holdings jumped from 31.6 percent in 1989 to 48.8 percent in 1998.
- The median value of those families' holdings soared from $10,800 to $25,000.
- But debt as a percentage of total family assets rose from 12.4 percent to 14.4 percent.
The Fed's data suggest much of the gain in net worth flowed to the wealthiest families. But it also showed substantial gains among households with incomes starting at $25,000. The report suggests that education levels play a key role in determining economic success.
Source: Richard W. Stevenson, "Fed Says Economy Increased Net Worth of Most Families," New York Times, January 19, 2000.
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