Despite the economic challenges brought about by the pandemic, the median net worth of the average American family surged by 37% between 2019 and 2022, according to the Federal Reserve's consumer finance survey released last week.
The mean net worth of an average American household, which is easily influenced by billionaires who can rake up the entire average, adjusted for inflation, stood at $1.06 million in 2022, a 23% increase compared to 2019, which was $868,000.
Meanwhile, the median net worth, which represents the midpoint in the ranking, for a typical American household was $192,900.
Households in the top 10% of income earners have a mean net worth of $6.63 million, according to the Fed survey, while households in the bottom 10% had a mean net worth of $5,300 in 2022.
The survey also revealed a decline in the percentage of families filing for bankruptcy, dropping from 2% in 2019 to just 1.3% in 2022.
Homeownership played a pivotal role in the financial surge of American households. In 2022, nearly two out of every three American families were homeowners, reflecting a slight increase from the previous three years. Rising home values significantly contributed to the overall increase in household wealth during this period, and the average net worth of homeowners stood at $1.53 million in 2022.
However, the surge in home prices has also created challenges for those aspiring to be homeowners.
Last year, the median home cost was over 4.6 times the median family income, making homeownership less accessible for many Americans. In another Fed survey released in May, it found that 65% of Americans who rent are doing so because they can't afford a down payment to buy a home.