In the past decade, the wealth of the median household in the United States has dropped by an average of one-third, according to a recent study published by the Russell Sage Foundation, a New York-based nonprofit research organization.
The group concluded that the median worth of American households has declined from a high of $98,972 in 2007 to $56,335 in 2013. For the 10-year period between 2003 and 2013, that figure dropped from $87,992 to $56,335 — about a one-third decrease.
The brunt of the loss has occurred since 2007, and it’s hit the bottom economic demographic the hardest.
From the study summary:
Through at least 2013, there are very few signs of significant recovery from the losses in wealth experienced by American families during the Great Recession. Declines in net worth from 2007 to 2009 were large, and the declines continued through 2013. These wealth losses, however, were not distributed equally. While large absolute amounts of wealth were destroyed at the top of the wealth distribution, households at the bottom of the wealth distribution lost the largest share of their total wealth.
Net worth is a measure of the value of a household’s assets against its debts: stocks, land and homes compared with what a household owes to own these assets free and clear. Home values, which are closely tied to the net worth of middle-class families, have been particularly affected over the past decade.
“While stock prices rebounded relatively quickly after the collapse in 2007, housing prices did not,” the report states. “As a result, the median of wealth not held in real estate declined by about only $6,900 between 2007 and 2013, compared to a decline in median total net worth of about $42,500. Affluent households are more likely than other households to hold stocks and have large portfolios, which allowed them to benefit from the gains in the stock market.”