Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, January 26, 1994 TAG: 9401260072
SECTION: BUSINESS PAGE: B-6 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
The Census Bureau report also showed that in every category of investment - real estate, retirement and savings accounts - black families own less than white families.
The years covered by the report included an eight-month economic recession that cost more than 1 million workers their jobs.
Falling real estate values caused much of the $4,849 decline to $36,623 in median net worth after accounting for inflation. Rising prices of stocks, cars and trucks, and retirement accounts helped offset the losses.
Real estate was America's investment of choice. Fifty-four percent of the average household's wealth was in a home, rental property or other real estate holdings.
Savings accounts and other interest-earning accounts were the second-biggest investment: 14 percent.
The boom years of the 1980s did little to lift Americans' net worth. Households' median net worth in 1988, $41,472, was little changed from the $42,934 recorded in 1984. Both figures were adjusted for inflation.
Median means that half the households had net worth - assets minus liabilities - of more than $41,472, and half had less.
Between 1988 and 1991, the net worth of the median white household plummeted $5,796, while the net worth of black and Hispanic households changed little.
The median white household was worth $44,408. The median black household was worth about a tenth of that: $4,604.
"Basically, black households have so much less net worth because they haven't accumulated as much as white households, and that's due to differences in income and earning power," said T.J. Eller, the Census Bureau demographer who wrote the report.
Blacks' homes were worth less than two-thirds of whites', their retirement accounts were worth only a third of whites', their savings in interest-earning accounts were worth one-fourth of whites'.
Hispanic households had median net worth of $5,345. Their investment pattern was similar to that of black Americans.
Some other averages from the study:
Age brings wealth. Households headed by people under 35 were worth $5,565; ages 35 to 44, $31,148; 45 to 54, $58,250; 54 to 64, $83,041; and over 65, $88,192.
Marriage brings wealth. Households formed by married couples typically were worth $60,065. Households headed by single men were worth $11,986; those headed by single women were worth $14,762.
The right location brings wealth. Geographically, the Northeast was the richest part of America, with a median net worth of $57,294. The South was poorest, at $26,775. The typical household in the West had a net worth of $39,735, and in the Midwest, of $38,677.
A college education makes a huge difference in wealth. Households headed by people with four years of college or more were worth $72,373; those with a high-school diploma, $33,254.
by CNB