America Saves Week: A Glance at the Survey of Consumer Finances

This month, the Federal Reserve published its triennial Survey of Consumer Finances, an invaluable resource in gauging America’s saving habits and shifts in net worth (especially for low-income populations). Some of the highlights:

• Overall, the proportion of families that reported that they had saved in the preceding year was stable relative to the 2004 survey at 56.5 percent.
• However, only 33.7 percent of families in the bottom quintile of income reported saving, down about a half-a-percent from 2004.
• The wealth gap is growing. While median net worth increased for most groups across the income spectrum, in the lowest quintile, “the median fell from $1,900 to $1,200; the mean fell from negative $1,600 in 2004 to negative $2,300 in 2007. For the rest of the distribution of net worth, the median and mean over the recent three-year period rose substantially for all other groups except the 75th-to-90th percentile group, which had seen relatively large gains over the preceding three years.”

Finally, this paragraph stood out:

“Across demographic groups, the pattern of changes in the recent three-year period is mostly one of small increases or decreases. Noticeable exceptions are declines for the following groups: the lowest quintile of the income distribution (2.4 percentage points); single families with children (1.2 percentage points); younger single families without children (1.7 percentage points); families headed by a person whose work status was retired (1.6 percentage points) or who was in the related retired-or-other-not-working category (1.2 percentage points); families headed by a person aged 75 or older (1.5 percent); and families living in the Northeast (3.3 percentage points).”

and

“Across net worth groups, the percentage changes in median assets and net worth were most similar for families in the top quartile of the distribution of net worth; for all except the lowest quartile of that distribution, the changes were more roughly similar; and for the lowest quartile of the distribution, the percentage decline in assets was much larger than that for net worth.”(emphasis added)

There is obviously a lot more to explore in the data, especially concerning financial services, retirement accounts, investment and homeownership, so I urge you to dive right in.