As of December 31, 2016, the net worth of U.S. households (including that of Non-Profit Organizations, which exist for the benefit of all) reached a staggering $92.8 trillion. That's up $5.5 trillion in just the past year, for an impressive gain of 12%. Of note, household liabilities have increased by only $500 billion since their 2008 peak, for a gain of just 3.4%; the value of real estate holdings is up by about $1.5 trillion (about 6% above that of the "bubble" high of 2006); and financial asset holdings have soared buy $22.3 trillion since pre-crash levels (over 40%), thanks to significant gains in savings deposits, bonds, and equities. The gains in wealth are not just due to a raging stock market, since the market cap of all traded U.S. equities has risen by only $7.7 trillion since their pre-2008 high, according to Bloomberg.
In real terms, household net worth has grown at a 3.5% annualized rate for the past 65 years, as seen in the chart above. That works out to almost a 10-fold gain in wealth, and that's impressive by any standard.
On a real per capita basis (i.e., after adjusting for inflation and population growth), the net worth of the average person living in the U.S. has reached a new all-time high of $286K, up from $62K in 1950. This measure of wealth has been rising, on average, about 2.3% per year since records were first kept beginning in 1951. By this metric, life in the U.S. has been getting better and better for generations.
The ongoing accumulation of wealth is not a house of cards built on a bulging debt bubble either, regardless of what you might hear from the scaremongers. As the chart above shows, the typical household has cut its leverage by one third, from a high of 22.1% in early 2009 to 14.8% by the end of last year. Households have been prudently and impressively strengthening their balance sheets over the past seven years by saving and investing more and by reducing the use of debt financing.
Is this a great country or what?