To help inform these policy debates, this report analyzes data from 1989 to 2013 of the Survey of Consumer Finances (SCF) on the trend in the level and concentration of wealth across families. U.S. Family Wealth

		Data and Limitations

Data regarding family wealth are very limited. In the SCF, wealth is measured by net worth (i.e., total value of assets minus total value of liabilities). Put another way, it is the value at which one-half of families in the distribution have less wealth and one-half have more wealth. In the case of wealth distribution, the median is a more reliable indicator of the wealth of the "typical" family than the mean because of the way in which a mean is calculated. The mean ranged from almost four to more than six times the median during the 1989-2013 period. As explained above, such a relationship indicates considerable concentration of wealth among families in the upper half of the wealth distribution. Mean family net worth typically increased to a greater extent than median family net worth from 1992 through 2007, which suggests that the wealth distribution became more concentrated at the upper end of the distribution over time. Since 2007, reflecting the negative impact of the deep 2007-2009 recession and the subsequent slow recovery on income and asset prices, both measures decreased (see Table 1 ). That median net worth declined and mean net worth was unchanged between 2010 and 2013 was the result of a continuing general decline in asset prices, notably housing prices. Family net worth appears to have become more concentrated in recent decades. The drop in median net worth (23%) was greater than the drop in mean net worth (19%), which suggests that the balance sheets of families in the lower half of the wealth distribution were proportionately more adversely affected by the 2007-2009 recession than those further up the distribution. The ratio of the mean to median is an indicator of the degree of concentration in a distribution because, as previously mentioned, the mean can be greatly affected by a few high-value observations.
U.S. family wealth has been an underlying consideration in congressional deliberations on various issues, including education, taxation, social welfare, and recovery from the 2007-2009 recession. This report analyzes the change over time in the level and concentration of family wealth as measured by net worth (i.e., assets minus liabilities) to help inform those policy deliberations.
According to the Federal Reserve's latest Survey of Consumer Finances (SCF), in 2013, mean family net worth was $534,600 and median family net worth was $81,200. The median is the value at which one-half of wealth-owners have lower values and one-half have higher values of wealth. The median is a more reliable indicator of the wealth of the "typical" family than is the mean, which, because of the way in which the mean is calculated, can be greatly affected by a relatively small number of families with high values of net worth. Mean family net worth is more than six times median family net worth, which suggests a concentration of wealth among families at the upper end of the wealth distribution.
The change over time in the relationship between the mean and median indicates how the distribution of wealth across families has changed. Both mean and median net worth increased from 1989 to 2007, with the mean typically increasing to a greater extent than the median. This suggests that in recent decades wealth became more concentrated among families at the upper end of the distribution. Both measures fell between 2007 (the outset of the 2007-2009 recession) and 2010 (the first full year of recovery). The relatively greater decline in the median than in the mean between 2007 and 2010 suggests that the recession and slow recovery had a proportionately greater effect on families in the bottom half of the wealth distribution than those further up the distribution.
According to a September 2014 article in the Federal Reserve Bulletin, which presents data from the 2013 SCF, "The improvements in economic activity along with changes in house and corporate equity prices combined to effectively stabilize average and median family net worth between 2010 and 2013 after both measures fell dramatically between 2007 and 2010."