During the first two years of the nationís economic recovery, the mean net worth of households in the upper 7% of the wealth distribution rose by an estimated 28%, while the mean net worth of households in the lower 93% dropped by 4%, according to a Pew Research Center analysis of newly released Census Bureau data.
From 2009 to 2011, the mean wealth of the 8 million households in the more affluent group rose to an estimated $3,173,895 from an estimated $2,476,244, while the mean wealth of the 111 million households in the less affluent group fell to an estimated $133,817 from an estimated $139,896
Fretting about your net worth? You might just need a need a new housing bubble and a bear market on Wall Street.
These wide variances were driven by the fact that the stock and bond market rallied during the 2009 to 2011 period while the housing market remained flat.
Affluent households typically have their assets concentrated in stocks and other financial holdings, while less affluent households typically have their wealth more heavily concentrated in the value of their home.
A large fraction of the non-wealthy people foolishly sell out of the market after a big downturn. Then they do not start buying back in until the recovery is well under way. This means the rich get richer and the poor get poorer.
The Census Bureau data also indicate that among less affluent households, fewer directly owned stocks and mutual fund shares in 2011 (13%) than in 2009 (16%), meaning a smaller share enjoyed the fruits of the stock market rally. Likewise, fewer had individual retirement accounts (IRAs) or Keogh accounts (22% in 2011 versus 24% in 2009) and the same share had 401(k) or Thrift Savings Plan accounts (39% in both years).
I will give you my standard advice: try harder. Learn more skills. Move to where you can get paid more and have better career advance prospects. The post-WWII period where the broad public experienced rising living standards ended years ago and we live in a new era. Raise your game.
|Share |||By Randall Parker at 2013 April 23 10:01 PM|