Reader K.S. e-mails:
“Charlotte Allen’s [Oct. 17] post ‘Life in the World’s Third Most Populous Country–It’s Great!‘ quoted the following statement from Forbes: ‘The typical American household has a net worth of $465,970, . . .’
“Although I’m not sure what “typical” means, I doubt it. In the October Smart Money magazine Unconventional Wisdom column, Roger Lowenstein presents information from this year’s Federal Reserve study, “Recent Changes in U.S. Family Finances.” He states that the median net worth of homeowners as of 2004 was $184,000. Some of the Census Bureau data in the Forbes article appears to be from 2005. Even with an increase in home values, it is hard to believe the $465,970 figure in Forbes.”
Thanks for pointing out a problem, K.S. I just quoted Forbes–but Lowenstein’s figures (the column isn’t online) might be more correct. This 2004 CNN story says this:
“The median net worth of all U.S. households, meanwhile, is $100,894, meaning half of all homes have less..
“On the high end, only 11.4 percent of U.S. households have a net worth of $500,000 or more.”
The now-cooling real estate boom of the past two years probably boosted those numbers substantially, but the Forbes figure still seems high. Could Forbes have confused “mean” and “median”? Even if it did, however, there seems no doubt that in today’s dollars, median-level Americans are a lot more prosperous than they were 40 years ago.