In 2021, the average net worth in an American household aged 64-75 reached over $1.2m [1] Federal Reserve - Changes in U.S. Family Finances from 2016 to 2019: Evidence from the Survey of Consumer Finances - Accessed June 2023 https://www.federalreserve.gov/publications/files/scf20.pdf, while the average household under 35 had a net worth of just $76k.
With these massive generational wealth gaps, this study seeks to dig deeper into the historical wealth distribution of different generations to understand whether the wealth gap has always been so vast.
In the U.S., household wealth has traditionally seen a relatively even distribution across different age groups. However, over the last 30 years, data from the U.S. Federal Reserve [2] The Fed - DFA: Distributional Financial Accounts - Accessed June 2023 https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/table/#quarter:119;series:Net%20worth;demographic:generation;population:all;units:shares shows that older generations have been amassing wealth at a far greater rate than their younger cohorts.
| Generation | Birth year | % of population in 2021 [3] Census.gov, National Population by Characteristics: 2010-2020 - Accessed June 2023 https://www.census.gov/data/tables/time-series/demo/popest/2010s-national-detail.html |
|---|---|---|
| Silent generation | 1928 - 1945 | 6.22% |
| Baby boomer | 1946 - 1964 | 23.32% |
| Generation X | 1965 - 1980 | 22.23% |
| Millennial | 1981 - 1996 | 24.57% |
| Gen Z | 1997 - 2012 | 23.66% |
In 1998, the American population under 40 years held 13.1% of America’s total wealth. Today, those under 40 hold only 6% of the total wealth. This means that millennials and Generation X own less than half of the wealth that older generations owned when they were the same age.
| Year (Q4) | BabyBoom | GenX | Millennial | Silent |
|---|---|---|---|---|
| 1989 | $59,642 | $1,806 | $0 | $208,044 |
| 1990 | $61,561 | $2,423 | $0 | $215,243 |
| 1991 | $69,911 | $3,534 | $0 | $231,121 |
| 1992 | $78,361 | $4,619 | $0 | $241,286 |
| 1993 | $88,424 | $7,119 | $0 | $253,392 |
| 1994 | $97,209 | $8,135 | $0 | $261,669 |
| 1995 | $113,557 | $10,374 | $0 | $279,367 |
| 1996 | $127,640 | $13,359 | $0 | $296,417 |
| 1997 | $148,059 | $19,631 | $0 | $320,125 |
| 1998 | $175,115 | $26,700 | $0 | $346,293 |
| 1999 | $206,461 | $35,587 | $0 | $368,844 |
| 2000 | $222,330 | $36,415 | $0 | $377,314 |
| 2001 | $236,303 | $39,353 | $304 | $371,881 |
| 2002 | $242,144 | $33,914 | $453 | $398,628 |
| 2003 | $276,279 | $43,967 | $1,050 | $437,996 |
| 2004 | $323,248 | $61,166 | $1,638 | $484,689 |
| 2005 | $360,194 | $82,344 | $3,253 | $519,803 |
| 2006 | $396,696 | $95,784 | $3,967 | $547,765 |
| 2007 | $419,495 | $99,580 | $4,826 | $560,740 |
| 2008 | $386,088 | $69,142 | $4,515 | $507,340 |
| 2009 | $416,691 | $77,632 | $6,247 | $502,570 |
| 2010 | $453,064 | $107,503 | $8,264 | $520,016 |
| 2011 | $463,794 | $119,653 | $8,944 | $493,349 |
| 2012 | $498,410 | $149,782 | $10,184 | $521,253 |
| 2013 | $554,298 | $198,410 | $18,545 | $558,063 |
| 2014 | $611,221 | $214,253 | $25,244 | $596,781 |
| 2015 | $650,483 | $218,346 | $32,554 | $617,012 |
| 2016 | $694,987 | $243,135 | $40,491 | $640,076 |
| 2017 | $749,584 | $315,792 | $49,507 | $657,272 |
| 2018 | $755,453 | $354,087 | $54,647 | $624,483 |
| 2019 | $845,135 | $438,025 | $66,314 | $668,936 |
| 2020 | $964,170 | $512,071 | $75,702 | $772,956 |
| 2021 | $1,073,538 | $630,022 | $106,241 | $1,003,616 |
| 2022 | $1,063,858 | $597,063 | $108,250 | $974,303 |
In 2022, the vast majority of the country’s wealth (64.6%) belonged to the older generations with baby boomers owning a whopping 52.1% of the country’s wealth, while the silent generation owned 12.5%.
Generation X (aged between 43 and 58 years) owns 28.9% of the country’s total wealth, while millennials (27-42 years) only possess 6.5% of the country’s total wealth. Hence, as a group, baby boomers are more than 8 times more wealthy than millennials.
Looking closer at the wealth distribution of millennials, it was revealed in 2021 [4] Minnesota Reformer, Millennials are the largest workforce and the least wealthy — why? - Accessed June 2023 https://minnesotareformer.com/2021/08/11/millennials-are-the-largest-workforce-and-the-least-wealthy-why-politics/ that Mark Zuckerberg, who has an estimated net worth of $97 billion, single-handedly owns 2% of all millennial wealth.
| Generation | Generation wealth gap 2021 |
|---|---|
| Silent generation | 12.5% |
| Baby boomers | 52.1% |
| Generation X | 28.9% |
| Millennials | 6.5% |
Source [6] Federal Reserve: Distribution of Household Wealth - Accessed June 2023 https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/table/#quarter:132;series:Net%20worth;demographic:generation;population:1,3,5,7;units:shares
In 2022, the baby boomer generation owned 43.2% of all real estate in the U.S. Gen X owned 33.2%, millennials 13.2% and silent generation 10.4%.
| Generation | Who owns real estate? |
|---|---|
| Silent generation | 10.4% |
| Baby boomers | 43.2% |
| Generation X | 33.2% |
| Millennials | 13.2% |
Source [6] Federal Reserve: Distribution of Household Wealth - Accessed June 2023 https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/table/#quarter:132;series:Net%20worth;demographic:generation;population:1,3,5,7;units:shares
Back in 1996, when the baby boomers were the same age as Generation X are today, they owned 41.6% of the real estate in the U.S. This is 25% more than Generation X owns in real estate today.
While baby boomers own the largest chunk of real estate compared to other generations, this is not where most of their wealth is held. Out of the baby boomers’ total wealth, 25.7% is in real estate, and this makes up the largest portion of their wealth. The second largest portion (25.3%) comes from corporate equities and mutual fund shares followed by pension entitlements at 14.7%.
Other assets account for 17.8% of their wealth, while private businesses and consumer durables account for 8.7% and 3.4% respectively.
| Generation | What baby boomers own? |
|---|---|
| Corporate equities and mutual funds | 25.3% |
| Pension entitlements | 14.7% |
| Real estate | 25.7% |
| Other assets | 17.8% |
| Private businesses | 8.7% |
| Consumer durables | 3.4% |
Source [6] Federal Reserve: Distribution of Household Wealth - Accessed June 2023 https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/table/#quarter:132;series:Net%20worth;demographic:generation;population:1,3,5,7;units:shares
Although millennials only possess 13.2% of the nation’s total wealth relating to real estate, this is where most of their money (42.2%) is held.
| Generation | What millennials own? |
|---|---|
| Corporate equities and mutual funds | 5.5% |
| Pension entitlements | 10.8% |
| Real estate | 42.2% |
| Other assets | 17% |
| Private businesses | 12.7% |
| Consumer durables | 11.8% |
Pension entitlements account for 10.8% of the millennials’ wealth, 17% are tied up in other assets, 11.8% in consumer durables, 12.7% in private businesses and 5.5% in corporate equities and mutual funds.
Diving deeper into the assets owned by baby boomers and millennials, the study shows that there’s a significant difference in the value of the assets owned.
The value of the total real estate owned by baby boomers is worth $18.09 trillion. The real estate owned by millennials is worth 30% of that at $5.55 trillion.
The difference in value of the corporate equities and mutual fund shares is even greater between the two generational groups; baby boomers own equities and funds to a total value of $17.79 trillion. Millennials, on the other hand, only own $0.72 trillion in equities and funds, meaning that baby boomers own 96% more in funds and equities than millennials.
Pension entitlements owned by baby boomers are worth $10.31 trillion compared to $1.42 trillion owned by millennials. Baby boomers’ private businesses are worth $7.23 trillion, while millennials’ private businesses are worth just 19% of that at $1.42 trillion.
Consumer durables owned by baby boomers are worth $2.98 trillion, while the consumer durables owned by millennials stack up to a value of $1.55 trillion.
Other assets owned by baby boomers are worth a total of $13.89 trillion, while millennials own $2.23 trillion worth of other assets.
| Value of assets (U.S. $ Trillions) | ||
|---|---|---|
| Baby Boomers | Millenials | |
| Corporate equities and mutual fund shares | $17.79 | $0.79 |
| Pension entitlements | $10.31 | $1.42 |
| Real estate | $18.09 | $5.55 |
| Other assets | $13.89 | $2.23 |
| Private businesses | $7.23 | $1.67 |
| Consumer durables | $2.98 | $1.55 |
Source [6] Federal Reserve: Distribution of Household Wealth - Accessed June 2023 https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/table/#quarter:132;series:Net%20worth;demographic:generation;population:1,3,5,7;units:shares
The data below shows the average wealth per generation historically. To get as accurate a view as possible, the study has taken inflation rates in mind. The data shows the average wealth the different generations had when they were in their 30s, 40s, and 50s.
Comparing Generation X and millennials, the data shows that millennials are 12.5% worse off than Generation X in terms of wealth accumulated around the same age. By the time Generation X was in their 30s, they had an average wealth of $122,999 (inflation rates taken into consideration), while millennials had an average wealth of $108,500.
The average baby boomer had a wealth of $140,346 in their 30s, 25% more than the wealth of millennials around the same age.
| Year | Generation | Median age | Wealth average per person | With inflation (to 2023) |
|---|---|---|---|---|
| 1989 | Baby boomers | 30s | $59,642 | $140,346 |
| 2005 | Generation X | 30s | $82,344 | $122,999 |
| 2022 | Millennials | 30s | $108,250 | $108,500 |
When baby boomers were in their 40s in approximately 1996, they had an average wealth of $127,640 ($251,417 when adjusted for inflation in 2023). Generation X in their 40s, had accumulated a wealth of $597,063 in 2022 ($598,444 when adjusted for inflation in 2023).
| Year | Generation | Median age | Wealth average per person | With inflation (to 2023) |
|---|---|---|---|---|
| 1996 | Baby boomers | 40s | $127,640 | $251,417 |
| 2022 | Generation X | 40s | $597,063 | $598,444 |
When the youngest of the silent generation reached their 50s in 1996, their average wealth was $296,417. Using historical inflation rates, that number is equivalent to a wealth of $551,279 in today’s value.
Baby boomers held an average wealth of $753,159 in their 50s, equivalent to $774,117 in today’s value.
Slightly better off than the silent generation but worse off than baby boomers is Generation X who, on average, owned $598,444 (inflation-adjusted) when they started reaching their 50s. This is 25.5% less than what Boomers had when they were the same age.
| Year | Generation | Median age | Wealth average per person | With inflation (to 2023) |
|---|---|---|---|---|
| 1996 | Silent generation | 50s | $296,417 | $551,279 |
| 2014 | Baby boomers | 50s | $611,221 | $753,159 |
| 2020 | Generation X | 50s | $597,063 | $598,444 |
Baby boomer wealth grew rapidly between 1996 and 2014, with an increase of over $34 trillion across all people in the baby boomer age range. The baby boomer population also decreased by over 5 million during this time. This meant that, with a much larger total wealth and a smaller population in this age group, the average baby boomer’s wealth grew from $127,640 in 1996 to $611,221 in 2014.
Baby boomers are considered the wealthiest generation in history but what happens when this wealth is passed on to younger generations?
A study from Coldwell Banker [5] Coldwell Banker, A Look at Wealth 2019: Millennial Millionaires - Accessed June 2023 https://blog.coldwellbankerluxury.com/a-look-at-wealth-millennial-millionaires/ estimates that millennials are expected to inherit over $68 trillion from their predecessors by 2030, meaning that in less than 10 years’ time they will have accumulated as much as five times the wealth they currently hold.
The population data and wealth data for the silent generation, baby boomers, Generation X and millennials are derived from the Census and the Federal Reserve. At the time the research was carried out, no data was available for Generation Z. The net worth per generation at specific times was calculated using a formula (net worth/population per generation group).
The inflation rates were calculated using SmartAsset’s inflation calculator.
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