By Steve Dinnen
Take heart, young people: You’re in better financial shape than you might think.
A recent crunching of numbers by the Center for American Progress shows that the average wealth of households of those under 40 stood at $259,000 at the end of 2023. What’s more, it rose an incredible 49% in the previous four years, far outpacing the growth of any other age group. Researchers said that’s a marked departure from the past, as wealth for young households had been essentially flat for decades before the onset of the pandemic.
So what triggered the surge? Basically it boils down to two things: higher real wages and higher employment levels. More people working for more money produces more wealth. Average housing wealth grew by $22,000, and ownership percentages increased slightly. The value of financial assets, mainly stocks and mutual funds, rose by $31,000. And nonhousing debt, including credit cards, fell by $5,000.
People aged 40 to 54 didn’t catch this wave. Their inflation-adjusted household wealth slumped by 7% from the end of 2019 to the end of 2023. The 55-to-69 crowd saw their wealth rise 4%, while seniors over 70 posted a respectable 15% increase.
The average wealth for all households, regardless of age, is $1.1 million, according to the Center for American Progress. So you 40-somethings have some catching up to do.
