Median Net Worth

Net worth, which is accumulated assets from real estate, stocks, bonds, and other assets minus debts, provides one pillar of retirement income. Financial wealth can provide income such as interest and dividends. Wealth holdings also can be sold to provide money for current spending and unanticipated expenses.

Chart 5a. Median total net worth of people aged 55–64, who report having assets*, in 2004 dollars, by educational attainment, 1994 and 2004

*Includes only people who report having assets.

Note: Net worth data do not include pension wealth. This excludes private defined-contribution and defined-benefit plans as well as rights to Social Security wealth. Data for 1994 have been inflation adjusted to 2004 dollars.

Source: Health and Retirement Study.

• In 2004, people aged 55–64 with less than a high school diploma had a median net worth of $47,868, while high school graduates had double that level ($114,781), people with some college had triple that level ($157,698), and college graduates had more than six times that level ($317,380). (See chart 2b to see how the educational distribution has changed over time).
• Between 1994 and 2004, median total net worth for people aged 55–64 decreased among high school graduates (from $145,231 to $114,781) and among people with some college education (from $204,308 to $157,698).
• Between 1994 and 2004, the gap in median net worth increased between non-Hispanic whites and non-Hispanic blacks from $133,969 to $147,858. The gap between non-Hispanic whites and Hispanics increased from $130,987 to $136,228.
• Overall, median household net worth for people aged 55–64 remained relatively stable between $149,455 in 1994 and $153,910 in 2004.

Home equity is a major source of wealth for the aged, but research indicates few aged sell their houses or take reverse mortgages to draw on home equity (Venti and Wise 2001; Fisher et al. 2007). Thus, net worth other than home equity identifies the assets that are most likely to be spent first.

Chart 5b. Median net worth excluding home equity of people aged 55–64, who report having assets*, in 2004 dollars, by educational attainment, 1994 and 2004

*Includes only people who report having assets.

Note: Net worth data do not include pension wealth. This excludes private defined-contribution and defined-benefit plans as well as rights to Social Security wealth. Data for 1994 have been inflation adjusted to 2004 dollars.
Source: Health and Retirement Study.

• The median level of net worth excluding home equity is also strongly related to higher levels of education. In 2004, people aged 55–64 with a college degree had a median net worth excluding home equity of $128,478 compared to a net worth of only $5,156 among people without a high school diploma. The same pattern exists between education and home equity.
• Over the past decade, median net worth excluding home equity for people aged 55–64 decreased from $54,809 in 1994 to $43,586 in 2004.