A Changing Nation—Wealth and Income Distribution - Net Worth Of Households

Income is one measure of a household's economic well-being; another measure is net worth, that is, the value of assets (what a person owns) minus any debts (what a person owes). In 2000 the median net worth of all households was $55,000 or $13,473 when home equity was excluded. While the median net worth of the lowest quintile was only $7,396, the median net worth of the highest quintile was $185,500. (See Table 4.4.)

Race and Hispanic Origin

The Census Bureau found huge disparities in net worth among the various sectors of society. The overall median net worth of a non-Hispanic white household in 2000 ($79,400) was more than ten times that of an African-American household ($7,500). In 2000 the highest quintile among whites had a median worth of $208,023, while among African-Americans, the median net worth of the highest one-fifth was $65,141. Among Hispanics, the median net worth of the highest quintile was $73,032. In the lowest quintile, the median net worth of whites was $24,000, while for African-Americans it was only $57, and $500 for Hispanics. (See Table 4.4.)

Age and Household Type

As householders age, they have greater opportunity to accumulate wealth. For many young and middle-aged workers, the accumulation of assets is one of the primary goals of their employment. As workers age and acquire

TABLE 4.1
Selected characteristics of households, by income, 2001
(Numbers in thousands. Households as of March of the following year)

	$57,500 to $59,999	$60,000 to $62,499	62,500 to $64,999	$65,000 to $67,499	$67,500 to $69,999	$70,000 to $72,499	$72,500 to $74,999	$75,000 to $77,499	$77,500 to $79,999	$80,000 to $82,499	$82,500 to $84,999	$85,000 to $87,499
Size of household
One person	179	432	210	206	144	238	119	215	119	123	101	116
Two people	707	823	617	686	531	666	539	660	417	559	356	422
Three people	372	443	318	401	323	394	280	350	252	310	239	308
Four people	320	492	298	412	319	375	300	380	265	359	278	287
Five people	121	151	135	160	134	160	138	163	117	141	114	122
Six people	63	51	49	81	56	54	46	31	31	47	32	41
Seven people or more	22	33	30	27	39	19	21	28	16	22	17	20
Mean size of household	2.94	2.80	2.94	3.06	3.14	2.96	3.08	2.96	3.08	3.10	3.19	3.15
Number of earners
No earners	79	102	73	71	66	73	79	64	35	35	49	21
One earner	439	814	447	543	315	555	297	505	246	361	235	279
Two earners or more	1,264	1,509	1,136	1,360	1,167	1,279	1,068	1,259	935	1,164	853	1,018
2 earners	1,002	1,261	901	1,087	889	990	796	964	697	905	617	770
3 earners	211	201	184	207	220	217	203	235	177	188	156	183
4 earners or more	51	46	50	66	58	72	69	60	61	71	80	64
Mean number of earners	1.89	1.75	1.87	1.88	1.98	1.88	1.99	1.89	2.06	1.98	2.07	2.05
Work experience of householder
Total	1,783	2,424	1,656	1,973	1,547	1,907	1,443	1,827	1,216	1,561	1,137	1,317
Worked	1,555	2,133	1,428	1,710	1,353	1,644	1,252	1,635	1,086	1,408	985	1,195
Worked at f-t jobs	1,380	1,960	1,263	1,565	1,195	1,512	1,122	1,506	957	1,273	920	1,109
50 weeks or more	1,198	1,759	1,118	1,368	1,065	1,349	985	1,339	844	1,162	822	1,008
27 to 49 weeks	148	147	109	147	93	124	93	123	83	87	72	73
26 weeks or less	34	54	36	49	37	38	44	45	30	23	26	28
Worked at p-t jobs	175	173	165	146	159	132	130	129	128	136	65	86
50 weeks or more	86	106	97	88	94	84	72	63	80	75	37	54
27 to 49 weeks	48	31	38	29	28	26	36	38	32	35	17	9
26 weeks or less	40	35	31	28	36	2	22	28	16	26	12	12
Did not work	228	291	228	263	194	263	191	192	131	152	151	123
Educational attainment of householder
Total, 25 yrs & over	1,689	2,352	1,587	1,904	1,473	1,833	1,393	1,773	1,182	1,539	1,110	1,276
Less than 9th grade	41	60	28	45	28	31	36	32	25	16	20	16
9th to 12th grade, no diploma	79	105	118	94	79	81	51	56	37	32	49	34
High school graduate (includes equivalency)	540	707	473	560	438	484	411	508	319	390	247	293
Some college, no degree	377	493	318	390	310	372	268	331	223	303	210	218
Associate Degree	162	246	174	197	153	180	155	216	133	174	163	142
Bachelor's Degree or more	491	740	476	619	465	685	470	629	446	625	420	573
Bachelor's Degree	352	494	329	450	315	481	330	425	270	405	274	321
Master's Degree	116	181	112	130	118	159	110	140	142	147	116	186
Professional Degree	7	30	20	26	11	20	15	36	18	43	12	25
Doctorate Degree	16	35	15	13	21	25	15	28	16	30	18	41
Tenure
Owner occupied	1,317	1,794	1,285	1,535	1,238	1,521	1,228	1,495	998	1,317	958	1,115
Renter occupied	450	611	367	422	300	374	197	319	209	232	171	187
Occupier paid no cash rent	16	20	4	16	9	12	19	13	9	12	7	15

homes and other investments, their net worth increases; that is, the value of what they own becomes greater than what they owe. (See Figure 4.1.)

Type of Assets

In its surveys, the Census Bureau asks respondents what type of financial assets they own. In 2000 only 7.1 percent of those in the lowest quintile held an interest-bearing account at a financial institution, while 41.9 percent of those in the highest income bracket did. Low-income households held equity in their own homes at a rate of 11.5 percent, compared with 35.4 percent of wealthy households. Upper-income households also held stocks or mutual fund shares and 401k savings plans at significantly higher rates than households in the lower quintiles. (See Table 4.5.)

Households with considerable net worth can generally offer their members greater opportunities. Householders with high net worth are better able to send their children to college, to travel, to help their children financially as they get started in life, to buy the things they want, and to feel more secure. Considerable net worth can buy political influence and power, or at least present the opportunity to meet those who have that power. Net worth is a major factor determining a household's position and power in American society.

TABLE 4.1
Selected characteristics of households, by income, 2001
(Numbers in thousands. Households as of March of the following year)

							Median income		Mean income
	$87,500 to $89,999	$90,000 to $92,499	92,500 to $94,999	$95,000 to $97,499	$97,500 to $99,999	$100,000 and over	Value (Dol.)	Standard error (Dol.)	Value (Dol.)	Standard error (Dol.)	Gini ratio
All races
All households	939	1,141	867	1,030	802	15,124	42,228	129	58,208	232	.450
Type of residence
Inside metro areas	822	1,007	765	900	705	13,741	45,219	188	61,694	275	.446
Inside central cities	227	284	201	227	204	3,731	36,731	211	52,705	431	.471
One million or more	155	174	120	160	118	2,581	37,691	393	54,764	577	.476
Under one million	72	111	81	67	85	1,150	35,215	369	49,226	625	.461
Outside central cities	595	722	563	673	502	10,010	50,697	205	66,957	353	.427
One million or more	420	533	426	477	365	7,938	54,321	345	72,037	462	.424
Under one million	175	190	138	196	136	2,072	43,631	472	55,640	476	.420
Outside metro areas	117	134	103	130	97	1,383	33,601	367	43,711	412	.433
Regions/divisions
Northeast	202	227	203	206	170	3,581	45,716	374	64,344	598	.461
New England	53	73	52	60	41	1,053	49,726	616	66,516	891	.449
Middle Atlantic	149	155	151	146	129	2,528	44,316	454	63,534	731	.464
Midwest	232	286	209	260	211	3,261	43,834	349	56,944	398	.428
East North Central	165	201	150	180	151	2,382	43,677	434	57,205	496	.431
West North Central	67	84	59	80	60	879	44,218	564	56,332	637	.419
South	326	336	268	357	253	4,648	38,904	308	54,046	390	.459
South Atlantic	197	168	161	204	138	2,611	40,623	293	55,393	535	.452
East South Central	46	70	35	48	31	628	35,387	496	48,772	791	.466
West South Central	83	98	71	106	84	1,409	38,195	591	54,690	781	.462
West	179	292	188	207	168	3,634	45,087	450	61,041	567	.441
Mountain	53	72	57	55	48	898	42,590	529	56,557	668	.432
Pacific	126	220	130	151	120	2,736	46,133	538	62,942	772	.444
Type of household
Family households	816	941	44	893	706	13,349	52,275	176	67,856	294	.409
Married-couple families	718	834	680	800	639	12,336	60,471	208	76,171	357	.379
Male householder, nsp	29	44	21	45	20	430	40,715	523	52,755	1,006	.410
Female householder, nsp	68	64	42	47	48	583	28,142	289	37,057	381	.441
Nonfamily households	123	200	124	137	96	1,775	25,631	169	37,700	341	.486
Male householder.	77	122	75	49	71	1,125	32,312	240	46,176	647	.473
Living alone	29	66	36	26	34	563	28,283	379	39,089	597	.472
Female householder	47	78	48	89	25	650	20,264	211	30,891	319	.479
Living alone	14	56	29	57	8	317	17,868	181	26,453	297	.460
Age of householder
Under 65 years	855	1,064	806	954	726	13,916	49,227	199	64,139	274	.426
15 to 24 years	19	52	18	14	21	246	28,196	486	36,148	521	.431
25 to 34 years	162	203	142	202	133	1,971	45,080	373	55,414	466	.400
35 to 44 years	250	352	294	274	225	4,219	53,320	419	69,088	577	.407
45 to 54 years	283	323	239	298	239	4,871	58,045	487	74,722	592	.407
55 to 64 years	141	134	113	167	108	2,609	45,864	425	63,523	666	.456
65 years and over	84	77	61	75	76	1,208	23,118	191	35,298	339	.473
65 to 74 years	61	51	43	39	50	892	28,172	325	41,973	565	.474
75 years and over	23	26	19	37	27	316	19,174	183	28,339	349	.447
Mean age of householder	46.4	44.2	45.3	46.0	46.2	47.1	(X)	(X)	(X)	(X)	(X)

Those with the fewest assets and net worth have the least to fall back on if they become ill or lose a job. They are the least able to provide financial support for their children. In addition, they are the least likely to have political power. These are the Americans most likely to fall into poverty if misfortune strikes.