Wealth Gap Between the Old and the Young: Old is Gold

Being young in the US may no longer be a thing of pride and power, with research showing that people above 65 are becoming richer by the day while those below 35 are getting poorer. The Pew Research Center in its research on social trends has uncovered this amusing fact.

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Drawing from the rich data collected by the US Census Bureau, the research finds that families headed by people above 65 have been doing better with time as compared to their counterparts below the age of 65. The total household wealth has been considered to draw this conclusion.

This is calculated by subtracting a household’s debts from its assets. Car, house, savings account and 401(k) account are counted among assets while various loans such as car loan, education loan, home loan and credit card debt are considered debts.

While increased savings is obvious with older people with them having the advantage of time, education loan is one of the factors decreasing the wealth of the younger lot. The research also points to the fact that the wealth gap between the two age groups is the largest now as compared to that in the last 25 years.

Various factors have led to the widening of the gap. The bubble burst of the housing market about 7 years ago has definitely worked in favor of those who bought their houses years ago. Add to that the crisis of jobs after the recession.

Only time will tell whether this gap will reduce or continue to widen.

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