Shoppers at Target near Herald Square in New York on Aug. 27, 2022. The Federal Reserve data showed that Americans made nearly across-the-board financial progress in the three years including and around the pandemic. (Hiroko Masuike/The New York Times)
American families saw the largest jump in their wealth on record between 2019 and 2022, according to Federal Reserve data released Wednesday, Oct. 18, as rising stock indexes, climbing home prices and government stimulus left people’s finances healthier.
Median net worth climbed 37% over those three years after adjusting for inflation, the Fed’s Survey of Consumer Finances showed — the biggest jump in records stretching back to 1989. At the same time, median family income increased 3% between 2018 and 2021 after subtracting out price increases.
While income gains were most pronounced for the affluent, the data showed clearly that Americans made nearly across-the-board financial progress in the three years that include the pandemic. Savings rose. Credit card balances fell. Retirement accounts swelled.
Other data hinted at those gains. But the Fed report, which is released every three years, is considered the gold standard in data about the financial circumstances of households. It offers the most comprehensive snapshot of everything from savings to stock ownership across racial, wealth and age groups.
This is the first time the Fed report has been released since the onset of the coronavirus. People lost jobs in mass numbers in early 2020, and the government tried to soften the blow with multiple relief packages. More recently, the job market has been booming, with rapid wage growth. At the same time, rapid inflation has eroded some of the gains.
Income climbed across all groups between 2019 and 2022, although gains were biggest toward the top — meaning that income inequality widened.
But in the three years covered by the survey, growth in wealth was actually the largest in percentage terms for poorer families. People in the bottom quarter had a net worth of $3,500 in 2022, up from $400 in 2019. Among families in the top 10%, median net worth climbed to $3.79 million, up from $3.01 million three years earlier.
The Fed’s newly released figures show that significant gaps in income and wealth persist across racial groups, although Black and Hispanic families saw the largest percentage gains in net worth.
Black families’ median net worth climbed 60%, to $44,900. That was a bigger jump than the 31% increase for white families, which lifted their household wealth to $285,000. Hispanic families saw a 47% increase.
c.2023 The New York Times Company. This article originally appeared in The New York Times.
