Saturday, February 25, 2006

America's net worth slowly climbing...

The federal reserve recently released a study that shows America's net worth grew only slightly between 2001 and 2004. The survey shows the median net worth raising 1.5%, to $93,100. That means half of all the households had a higher net worth. Can you guess why there was a smaller raise this time around? If you said it's because there was an increase in debts, especially mortgages, you're right! Give yourself 10 points. That's actually the biggest reason. It's lists several reasons why net worth has increased only slightly.
  • Net worth: The increase in net worth in the latest survey was due mostly to an increase in home ownership and an increase in housing prices
  • Income: A decline in wages also helped account for the slow growth in net worth.
  • Savings: The percent of families who said they'd saved in the preceding year fell 3.1 percentage points, to 56.1 percent.
  • Assets: The percentage of families who owned assets rose 1.2 percentage points to 97.9 percent.
  • Debt: The share of families with debt rose 1.3 percentage points to 76.4 percent.
  • Stock ownership: The percentage of families investing in stocks, directly or indirectly through mutual funds, fell 3.3 percentage points, to 48.6 percent.
That's just a quick synopsis. If you're interested in a little more detail of each, check out the article.

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