Trends in the Distribution of Family Wealth, 1989 to 2022
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CBO examines changes in family wealth from 1989 to 2022 using a measure of wealth that includes projected Social Security benefits. Over that period, family wealth was unevenly distributed, and wealth inequality increased.
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In a complementary analysis, CBO used its updated measure of family wealth to examine the relationships between family wealth and the individual characteristics that it examined in 2022. The results are presented in the supplemental data published with this report.
Summary
In this report, the Congressional Budget Office examines changes in the distribution of family wealth (a family’s assets minus its debts) from 1989 to 2022. Building on earlier work, CBO used an expanded measure of wealth that includes families’ projected Social Security retirement and disability benefits.
- Total Wealth. Adjusted for inflation, the wealth held by families in the United States almost quadrupled between 1989 and 2022, rising from $52 trillion (in 2022 dollars) to $199 trillion, at an average rate of about 4 percent per year. In 2022, retirement assets and accrued Social Security benefits made up about 40 percent of wealth. Nonretirement financial assets, home equity, and other assets made up the rest.
- Concentration of Wealth. Over that 33-year period, family wealth was unevenly distributed, and that inequality increased. In 2022, families in the top 10 percent of the distribution held 60 percent of all wealth, up from 56 percent in 1989, and families in the top 1 percent of the distribution held 27 percent, up from 23 percent in 1989. The share of wealth held by the rest of the families in the top half of the distribution shrank from 37 percent to 33 percent over the same period. Families in the bottom half of the distribution held 6 percent of all wealth in both 1989 and 2022.
- Value of Accrued Social Security Wealth. In 2022, accrued Social Security wealth accounted for 20 percent of families’ total wealth—up from 17 percent in 1989. Together, defined contribution and defined benefit pension plans accounted for a similar share, 21 percent. Throughout the period, Social Security wealth accounted for a larger portion of assets among families who had less wealth.
- Changes in Wealth During the Coronavirus Pandemic. From 2019 to 2022, total family wealth increased by 17 percent, from $170 trillion to $199 trillion (in 2022 dollars), and median family wealth increased by 8 percent, from $466,500 to $504,000. Wealth inequality changed little during the pandemic: Throughout that period, the share of wealth held by families in the top 1 percent of the distribution remained at 27 percent.
- Differences From CBO’s Previous Studies of Family Wealth. In 2016, CBO published a report that defined family wealth as a family’s marketable wealth—that is, its easily tradable assets minus its debts—and in 2022, CBO published a report that defined family wealth as the sum of a family’s marketable wealth and its promised income from defined benefit pension plans. This report updates those prior analyses with more recent data and expands the measure of wealth to account for future streams of income from Social Security benefits.