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Data Shows Low Income US Households Gained Wealth In Pandemic

Data Shows Low Income US Households Gained Wealth In Pandemic

June 24, 2021 at 03:08AM
by PYMNTS

The poorest half of United States households saw a boost in wealth amid the pandemic, Bloomberg reported.

Wealth for the bottom half of households rose 36 percent, the fastest increase in terms of percentage according to data provided by the Federal Reserve.

The bottom 50 percent of the country saw a boost to $2.62 trillion in the first quarter of this year, according to Fed data. That was eclipsed by the wealth of the top 1 percent, with that bracket reaching $41.52 trillion.

Broken down further, the bottom 50 percent saw a $3.61 trillion boost in real estate, $1.34 trillion in consumer durables, $0.16 trillion in corporate equities and $0.82 trillion in pension entitlements, the Fed reported.

Much of the new wealth at the top came from stock market surges, according to Bloomberg, with the richest 1 percent holding equities worth $20 trillion as of the last quarter, an increase from $11.5 trillion the previous year. In addition, their share of overall stock ownership rose to 53.5 percent, an all-time high.

Another driver was the nationwide boom in housing sales, Bloomberg reported. The top 10 percent of households now own real estate assets worth around $11.8 trillion. Meanwhile, the bottom 50 percent accumulated $1.4 trillion in that category.

Fed data from early June showed that the net worth of households and nonprofits increased to reach $136.9 trillion in the first quarter of 2021.

There was also a boost of both directly and indirectly held corporate entities, amounting to a rise of $3.2 trillion. And real estate rose in value by $1 trillion.

But household debt was on the rise, too, reaching $62 trillion in Q1 2021. Household debt also increased by 5.8 percent at an annual rate, which was a decrease from the 6.3 percent from the previous quarter.