Over the history of the United States there has been a general trend of increased wealth with each passing generation. However, analysis by the Pew Research Center points to the exact opposite. The older generations have been able to amass more wealth over time relative to the younger generations. Despite the obvious ability to collect more wealth by living longer, households in 1984 headed by people 35 years and younger had a median net worth of $7,859 greater than households headed by people 35 years and younger in 2009. Today, the wealth gap between households headed by people age 65 and older and households headed by people age 35 and younger has never been wider. In 1984 the 65 year old age group had a median net worth 10 times greater than the 35 year old age group. Today the 65 year old age group holds a median net worth 47 times greater than the 35 year old age group.
Besides a weak economy, there are several other likely culprits to this increasing net worth gap. For instance, today’s individuals are starting their independent lives later and putting home ownership off longer. The increased cost of attending college also has aided in this change; younger generations are attending college in greater numbers compared to the older generations.
The Pew Research Center attributes the largest factor in the increased wealth gap to the housing market. The report said, “While rising home equity helped drive wealth gains for the older generation over the long-term, younger people had less time to ride out the housing market’s volatility — especially its most recent boom and bust.” Whatever the reason for the increased net worth gap, one thing is certain, the younger generation is not better off financially than their parents and grandparents.
Annalyn Censky, Older Americans are 47 times richer than young, https://money.cnn.com/2011/11/07/news/economy/wealth_gap_age/index.htm?iid=HP_River (accessed November 8, 2011)