Against forecasts, American families report economic gains after the pandemic

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The pandemic-era actions of the government prevented a spiral of declining asset values, depleted savings and higher household debt.

It is a stark contrast with the 2008 crisis, when there was no widespread private sector debt relief, asset prices plunged, and households spent a decade working through their debt overhang.

The flip side of that is the actions made the federal government’s balance sheet worse — with substantially higher public debt — in order to bolster individuals’ and companies’ balance sheets.

The Fed’s Survey of Consumer Finances, out Wednesday, is the gold standard of data about Americans’ financial condition. It’s only released every three years, but luckily it was conducted in 2019 and 2022, bookending the pandemic. It showed improvement in households’ finances across nearly every dimension.

The median U.S. household had a net worth of nearly $193,000 in 2022, up from an inflation-adjusted $141,100 in 2019.

Measures of “financial fragility” were down. The median debt payments as a share of income fell to 13.4%, the lowest seen in the 33-year history of the survey.

It reflects a massive, whole-of-government effort to use fiscal and monetary power to keep Americans’ household finances afloat.

Nearly $5 trillion in pandemic spending supported people’s finances through many channels, including direct payments to Americans and expanded unemployment insurance benefits.

What is the average net worth of Americans?

Average net worth increased by 2% to $748,800 between 2016 and 2019, the bank reported in September 2020, the most recent year it published the data. Median net worth, however, rose 18% over that same time period to $121,760.

What net worth is considered rich?

You might need $5 million to $10 million to qualify as having a very high net worth while it may take $30 million or more to be considered ultra-high net worth. That’s how financial advisors typically view wealth.

Less saving, more spending, that is the economy of Americans