Authors: Joshua Cohan
(WASHINGTON) -- Median household net worth declined 35 percent between 2005 and 2010 to $66,740, the Census Bureau reported on Monday.
The federal agency reported median net worth dropped to $66,740 from $102,844 in constant dollars in that period, which included the last recession.
However, excluding home equity, median household net worth actually increased to $15,000 from $13,859 between 2009 and 2010.
Karen Dynan, senior fellow at the Brookings Institution, said the figures show the “devastating” effect of the housing bust on the condition of American families.
“You can clearly see in comparing homeowners and renters, homeowners suffered more in a decline in wealth,” she said.
Census Bureau economist Alfred Gottschalck said the overall decline in net worth “reflects drops in housing values and stock market indices.”
Younger age groups had the biggest percentage declines. Younger households saw a percent decline of 37 percent while older households had a decline of 14 percent. Median net worth of households 65 and older decreased to $170,128 from $195,890. For those under 35, median household net worth decreased to $5,402 from $8,528. However, householders age 35 to 44 had the largest percent decline in median net worth of any age group from 2005 to 2010 at 59 percent.
Households in the Northeast had the highest median net worth at $86,758. Households in the West had the lowest at $57,034. Those in the South followed closely at $57,079. Households in the Midwest had a median of $77,769.
Not surprisingly, more education is associated with a higher net worth. In 2010, those householders with a graduate or professional degree had a median net worth of $245,764. Those with a bachelor’s degree had a median net worth of $142,518. Those with a high school diploma had a median net worth of $42,223. For those without a high school diploma, their median net worth was $7,270.
Last week, the Federal Reserve released its Survey of Consumer Finance which showed the median family had a net worth of $77,300 in 2010, levels last seen in 1992, down from $126,400 in 2007.
The White House responded to last week’s data, saying that household wealth has risen in every year President Obama has been in office, by 23 percent. They explained that the drop in household wealth occurred in 2008, before the president took office.
“Broadly speaking, these two surveys are in line and show how tough financial conditions are for American households and just how far we have to go to get back to where we were,” Dynan said. “They very much illustrate that even though it’s been almost three years since the recession ended, it probably doesn’t feel that way for most families.”
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