Sunday, November 23, 2014

Middle class households' wealth fell 35 percent from 2005 to 2011

A new US Census Bureau report shows that the median household's net worth fell from $106,591 to $68,839 from 2005 to 2011:

Median wealth

Source: U.S. Census Bureau.

That's one of many astounding facts in the report, which focuses on changes in household wealth. For example, it also found that the median net worth of the top 20 percent divided by the median of the second 20 percent was 39.8 in 2000. Today, it's 86.8.

In addition, the latter group lost nearly 56 percent of its wealth. And the overall wealth of the bottom 20 percent fell from -$915 to -$6,029. Or, put another way, the median American in that poorest group saw their debt increase more than 6 and a half fold.

While people in the top 40 percent lost a fair-sized chunk of assets in the downturn, they are currently above where they were in 2000. Meanwhile, the median household in the middle quintile is still worse off than they were then. In the second quintile, the median household only has half the wealth it did in 2000. And the bottom quintile's median household is far deeper in debt.

Correction. In one instance, this article originally said "income" where it meant "net worth." It also said "next 20 percent" instead of "second 20 percent."

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