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Assets of Wealthy vs Average Americans

How do the assets of the wealthy stack up against the assets of the typical American? Do the wealthy simply own more of the same stuff? Or do they own an entirely different asset mix than the typical American? In the post, I will explore these questions using data from the Survey of Consumer Finances (SCF) conducted by the Federal Reserve. 

The latest SCF data was released in late 2023 and is based on 2022 data. Here’s the breakdown of assets by wealth percentile group: 

Here is the same data in table form:

What do the data show? The rich love stocks and businesses, not houses and cars. Let’s look at the other major takeaways:

Real Estate 

  • Real estate represents the bulk of lower-wealth households’ assets. The higher the net worth percentile, the lower real estate becomes as a percentage of assets.
  • For the bottom 50% of households, real estate accounts for 51.1% of their total assets. For the top 1%, it accounts for 17.5%. For the top 0.1%, it accounts for 9.1%.

Consumer Durable Goods

  • Consumer Durable Goods (i.e. vehicles) are the 2nd largest component of lower-wealth households’ net worth. Meanwhile, they are a relatively insignificant asset for higher net-worth households. 
  • For the bottom 50% of households, consumer durable goods account for 19.4% of their total assets. For the top 1%, they account for only 1.6%. 
  • The wealthiest top 0.1% spend have a higher % of their assets in consumer durable goods than the top 1% and a similar amount to the top 10%. My guess is that this represents the toys of the ultra-wealthy: yachts, Lamborghinis, etc. 

Stocks

  • Higher net-worth households hold more stocks (corporate equities). The top 1% have 37.4% of their assets in the stock market while the bottom 50% have only 4% in the market. 

Private Businesses

  • Private Businesses are a bigger component of assets the higher the net worth percentile. They jump from only 1.7% percent of the bottom 50 to 15.8% of the top 1%. For the top 0.1% private business becomes 23.4% of assets! 

Pension Accounts

  • Pension accounts are most significant for the upper middle class. Pension assets account for 21.3% of assets for the top 10% and 25.4% of assets for the 50-90%. Meanwhile, pensions only account for 10.4% of assets for the bottom 50% and 9.6% of assets for the top 1%. 

Here is a graph based on 2019 data that separates the assets into slightly different categories: 

The second chart confirms all the major takeaways of the first chart. 

The new insight I gained from the second chart comes from interest-earning accounts, such as savings accounts. Interest-earning accounts remain a relatively consistent portion of assets regardless of net worth. 

Conclusion

The data from the Survey of Consumer Finances shows that the wealthy have a more diversified portfolio of assets than the average American. They invest much more in stocks and private businesses. Meanwhile, the average American relies more heavily on real estate, durable goods, and pension accounts. 

Scott Caufield, CFA, CPA