Becoming Wealthy or Wealth Accumulation

Wealth Accumulation

Is America Still The Land Of Opportunity?

A recent Survey of Consumer Finances conducted by the Federal Reserve Board revealed these statistics about the state of America's finances.

Do any of these facts hit home with you?
The typical American family earns about $45,000 per year. From 2001 to 2004, family debt increased 33% (adjusted for inflation). Surprisingly little of this debt stems from unnecessary spending. Instead, credit is being used to pay for necessities like housing, household expenses and health care, particularly in low- and middle-income families.

Average net worth, which grew rapidly during the boom of the 1990s, rose only 1.5% between 2001 and 2004 for the average American family. In other words, for most of us, the worth of our investments is not keeping up with the inflation rate.

The middle class is being squeezed more tightly than ever. Among the wealthiest 10% of Americans, net worth rose to $831,600, or a 6.5% increase from 2001. Meanwhile, the net worth of those in the bottom 25% fell 1.5% to $13,300.

More than a third -- 36% -- of those who owe more than $10,000 on their cards have household incomes under $50,000. 13% who owe that much have household incomes under $30,000. The percentage of disposable income used to pay debts is near record highs.