Net worth of U.S. households record $86.8 trillionStaff writer ▼ | March 10, 2016
The net worth of U.S. households ended 2015 at the highest level on record, reaching $86.8 trillion.
Wealth Household net worth rebounded by $1.64 trillion
Household net worth rebounded by $1.64 trillion in the fourth quarter, thanks to an upturn in the stock market and gains in real estate.
The net worth rise, as reported in the Federal Reserve’s quarterly “financial accounts of the United States,” was driven by a $758 billion gain in corporate equities and a $458 billion increase in the value of real estate.
It represents a rise of 1.9%, and comes after a $1.32 trillion decline in the third quarter.
It should be pointed out that real estate, and stocks in particular, are disproportionately held by the rich. That said, real-estate gains are the main way the middle class adds wealth.
Household debt rose by a seasonally adjusted 3.4% in the fourth quarter, again driven by student and auto loans. Outstanding mortgage debt grew by 1.5% but consumer credit — which includes car loans, student loans and credit cards — rose 5.9%.
Businesses are loading up on debt more aggressively, with their nonfinancial debt expanding by 5%. Their cash stockpile rose slightly to $1.95 trillion from $1.9 trillion.
A gauge of their sensitivity to changes in interest rates, the ratio of short-term debt to total debt, fell slightly to 27.5% from 27.84%. ■