dcsimg
 

Americans get richer in the third quarter

December 14, 2010

By Barbara Marquand | Money Rates Columnist

Despite the dismal housing market, Americans are making progress in rebuilding their wealth.

U.S. household net worth rose 2.2 percent to $54.9 trillion, a gain of $1.2 trillion, in the third quarter, according to recently released statistics by the Federal Reserve.

The uptick follows a decline in the spring, but continues a rebound since first quarter of 2009 when household net worth totaled $49 trillion. Still, Americans have more rebuilding to do to get back to where they were before the recession hit when U.S. household net worth peaked at $66 trillion.

The gain in the third quarter stems from boosted stock portfolios and a decline in household debt, which fell at a 1.75 percent annual rate. The decline was the 10th straight quarterly drop as Americans continued to shave what they owe on credit cards, car loans and mortgages. Mortgage debt fell at an annual rate of 2.5 percent in the third quarter, about the same as the previous quarter, the Federal Reserve said. Debt on credit cards and other loans was done 1.5 percent, after a 3.25 percent decline in the second quarter.

Meanwhile, the Fed's balance sheet for households shows the hard blow dealt by the housing market collapse. Household real estate assets totaled $16.6 billion in the third quarter, down from $17.2 billion in the second quarter and down from $20.9 billion in 2007 before the recession began.

Growth in savings accounts

Total bank deposits grew in the third quarter to $7.66 billion from $7.62 billion in the second quarter. Those assets included deposits in:

Checking accounts: Deposits fell to $126.8 billion from $137 billion

Savings accounts and CDs: Deposits rose to $63.5 billion from $63 billion

Money market accounts: Fund shares rose to $11.4 billion from $11.3 billion.

• Foreign deposits jumped to $59 billion from $51 billion.

Bank deposits make up almost 14 percent of net worth, about the same as individual stocks. Mutual fund shares make up 8 percent of net worth, and real estate holdings account for about 30 percent of household net worth. The remaining share of wealth is from retirement accounts, bonds and personal belongings, such as cars.

Your responses to ‘Americans get richer in the third quarter’

Showing 0 comments | Add your comment
Add your comment
(required)
(will not be published, required)