Apr 29, 2024 - Economy

Young Americans' wealth has soared since the pandemic

Data: Center for American Progress analysis of Federal Reserve data; Chart: Axios Visuals

Household wealth for those under 40 in the U.S. is up 49% from its pre-pandemic level, according to a new analysis from the left-leaning Center for American Progress.

Why it matters: Young households haven't seen wealth growth like this since the Federal Reserve first started tracking this data in 1989.

Stunning stat: Millennials — born between 1981 and 1996 — saw their wealth double over this period, per CAP.

Zoom in: Wealth includes the value of a household's assets, including stocks, bank accounts, and real estate, minus its liabilities, such as mortgages and student loan debt.

How it works: Those under 40 have seen big asset gains and have been able to reduce some liabilities, CAP points out.

  • Average housing wealth rose $22,000 — as homeownership rose and home prices soared. Liquid assets climbed, courtesy of leftover savings from pandemic relief and higher wages.
  • And the value of the group's financial assets, mostly stocks and mutual funds, increased by $31,000.
  • Meanwhile, nonhousing debt fell by $5,000. With more money in their pockets, people could pay off credit cards (the student loan moratorium helped), or not take that debt on at all.

For the record: The Federal Reserve data looks at average wealth, which raises the question: Are these gains widely distributed?

  • CAP says these gains are broad-based, pointing to separate (but less timely) data from the Fed's survey of consumer finances that show a 140% increase in median wealth for households under 35 from 2019 to 2022.

Reality check: Older Americans are still far wealthier than the youngs.

The bottom line: Without any apparent dip in their avocado toast consumption, young Americans have managed to increase their financial security.

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