The Landscape of National Wealth Data

Introduction

Wealth, or “net worth”, is a particularly helpful indicator of financial well-being because it reflects more than a paycheck. It includes money in the bank, ownership of a business or rental property, retirement accounts, and home equity – the kinds of resources people can draw upon when they want to pursue opportunities or to cover unexpected expenses. It also accounts for debts, capturing the presence of student loans, medical debts, credit cards, and mortgages. Unlike income, which reflects the flow of resources in the present, wealth is a snapshot of accumulated advantages and disadvantages over time – a record of who has been able to save, invest, own, and pass down resources to future generations. In the United States, wealth disparities have widened over time. As a result, more families struggle to meet basic needs, invest in their future, or have the flexibility to respond to unforeseen financial shocks.¹ With detailed wealth data, researchers, nonprofit organizations, or government agencies can understand the disparity of resources in the U.S. and begin to address these widening gaps.

Yet despite its importance, consistent and reliable measures of net worth in the U.S. are limited. Our understanding of wealth disparities relies on federal surveys and research efforts that differ in purpose, geographic granularity, and frequency. This blog post aims to summarize the landscape and findings of wealth data in federal data sources.

U.S. wealth inequality as told in the federal data sources

National data shows the growing concentration of wealth at the top and reveals deep, persistent racial disparities. Drawing from the Survey of Consumer Finances (SCF), Survey of Income and Program Participation (SIPP), and Distributional Financial Accounts (DFA), it is possible to paint a clear picture of national wealth inequality.² But before investigating wealth disparities, it’s important to understand how wealth is measured in these federal data sources.

Government surveys define wealth as the total dollar value of all assets owned by members of a household or family minus the dollar value of their debts. This is synonymous with the term “net worth.”

Different government surveys tend to produce varied estimates of net worth. The Federal Reserve’s Survey of Consumer Finances (SCF)(opens in a new tab) is the most widely used source for understanding U.S. wealth. It collects detailed information on assets and debts for families (see “How is wealth measured?” below). It oversamples high-wealth families, which allows the SCF to capture the extreme skew of the wealth distribution nationally and tends to report greater levels of wealth inequality. ³ The SCF includes information on race/ethnicity, age, education, homeownership, and other characteristics, but has a relatively small (4,602 families in 2022) sample size. Because of this, it can show differences in wealth for major groups but is limited when trying to assess wealth differences for more detailed combinations of characteristics and is not well-suited for geographic comparisons beyond U.S. Census Regions, such as at the state level.

The Census Bureau’s Survey of Income and Program Participation (SIPP) (opens in a new tab)also provides detailed information on assets and debts, based on a much larger sample and reports data at the household level. Unlike the SCF, the SIPP oversamples low-wealth households and thus likely does not capture the top of the wealth distribution quite as well as the SCF. Its larger sample and availability at both U.S. Census Region and state levels allows more flexibility for analyzing multiple demographic characteristics or for comparing geographies. Still, sample sizes are smaller and less reliable at the state level, and since 2019, it has increasingly struggled with poor survey response rates and data quality, making it unclear how useful the SIPP will be for understanding wealth patterns in the long-term.

The Federal Reserve’s Distributional Financial Accounts (DFA) (opens in a new tab) Federal Reserve’s Distributional Financial Accounts (DFA) is a newer data product that provides quarterly estimates of aggregate wealth and its components (e.g., different types of assets and debts). This data product combines information from the SCF with the Financial Accounts of the United States (which provide quarterly data on aggregate balance sheets of major sectors of the U.S. economy) to illustrate the makeup of wealth in the United States. The DFA reconciles differences in asset and debt categories and measurement units, aligning SCF family-level data with household-level measures from the Financial Accounts of the United States.⁴

Despite differences in measurement, all of these products clearly document dramatic and persistent differences by race and an increasing concentration of net worth among the most wealthy.

Growing concentration of wealth at the top of the distribution

Since the 1990s, the wealthiest households have seen the largest increases in their level of wealth.⁷ According to the SCF, the median net worth for all families grew from $108,500 in 1989 to $192,700 by 2022 (both in 2022 dollars). But as shown in Figure 1, wealthier families fared better over the same period, as median net worth of the top 10 percent of families grew from $1,593,200 to $3,795,000.⁸ The top 10 percent held 61 percent of all wealth in 1989 and 66 percent in 2022 – with 30 percent of all wealth held by the top one percent of families in 2022.^{9, 10}

Persistent racial wealth gaps

Racial wealth gaps in the U.S. have been generations in the making and despite many efforts related to addressing inequality in wealth and opportunity, have remained largely unchanged. White-Black wealth gaps decreased rapidly post-emancipation in 1860 and continued to gradually decrease through the mid-20th century, but progress stagnated around 1960 and improvements have been minimal since.¹¹ This plateau reflects both historical financial exclusion and the speed at which wealth grows for those who already have substantial assets. As wealth has become increasingly concentrated at the top, households without intergenerational resources remain structurally disadvantaged in their ability to accumulate assets.

Data from the SCF and DFA demonstrates how racial wealth gaps have increased in recent years, and how groups hold their wealth quite differently in the U.S. The SCF, which reports family net worth, shows that in 2022 the median Black family had $44,900, the median Hispanic family had $62,100, and the median White family had $284,300 in net worth. DFA data, which measures wealth by households, reports that White households make up 65 percent of U.S. households but held 85 percent of the total wealth in 2022. Black households, who make up 12 percent of the total, held less than 4 percent of the nation’s wealth; and Hispanic households account for 14 percent of the total but only 2.3 percent of wealth.^{12, 13}

Net worth reflects the balance of all assets minus all debts, and this mix of assets and debts tends to vary by race. The two largest asset classes that make up net worth are home equity and retirement accounts. ¹⁸White households are more likely than Black or Hispanic households to own their homes and to participate in retirement accounts, and they typically hold higher balances in both. For Black and Hispanic households that do own homes or have retirement savings, however, these assets often make up a larger share of their total net worth. Surveys also show that White households are more likely to hold financial assets such as stocks and mutual funds. While relatively few households have substantial business equity or real estate holdings aside from their residence, these are often a large component of wealth for high net worth households.¹⁹

Disproportionate access to wealth building activities like saving, purchasing a home, and starting a business have contributed to the long-standing systemic inequities which fuel the persistent wealth gap between White and Black households. Most of the nation’s household wealth is in the form of real estate ownership, but Black-owned property remains undervalued relative to White-owned property, hindering the ability of Black households to gain equitable returns from homeownership. ²⁰Black people also continue to face persistent barriers in access to the banking and financial system²¹, which has made the task of building Black communities’ trust in banks a key barrier to closing the racial wealth gap.^{22, 23}

Conclusion

National wealth data consistently shows a highly unequal distribution of net worth in the United States, with substantial and longstanding disparities by race and class. The federal data sources make it clear that the wealthiest households have seen disproportionate gains over the past several decades and median wealth for Black and Hispanic households remains far below that of White households. Additionally, households differ greatly in the composition of their assets and debts. Together, these sources reflect a long history of economic exclusion from wealth-building activities for some groups. This national context is useful for researchers and policymakers to understand the conditions in which efforts to close wealth gaps take place.

Still, these national sources vary widely in their usability, with different measured universes, sample sizes, and geographic granularity, making it difficult to navigate the national data to inform efforts to address wealth inequality. They offer only a snapshot view of wealth in a large, geographically and economically diverse country. Relying on national data alone to drive efforts to close wealth gaps is limiting since people experience economic opportunities and barriers locally and within their regions. National data on net worth should be used as a shared understanding and context for which local and regional wealth patterns are understood and compared to.

Given large and growing wealth inequality, consistent and accurate federal wealth data should be a high priority for our federal statistical systems. Moreover, given regional differences in wealth and wealth building opportunities, more availability of wealth data at smaller geographic levels is needed to inform efforts to close wealth gaps. The Open Wealth Consortium addresses this need by estimating wealth data for metro areas in the U.S. and partnering with local organizations to ground truth and analyze data based on specific local contexts and use cases.