Educational Household Wealth Trends and Wealth Inequality

November 29, 2022

Cumulative Changes in Average Real Wealth by Education

Line chart showing household wealth index by varying educational attainment levels

SOURCES: Distributional Financial Accounts and Institute for Economic Equity calculations.

NOTES: College represents families with at least a bachelor’s degree; other education levels represent the families’ highest completed education. Vertical bars indicate recessions.

This figure shows the average real wealth of families with a given educational achievement. On average, families headed by someone with at least a bachelor’s degree have greater wealth than similarly educated families did in the past. College-headed families in 2022 had 83% more wealth on average than similar families in 1989. Growth has not been as pronounced for less educated families; in most quarters, those headed by someone with less than a high school diploma had less wealth, on average, than similar families in 1989, and they had 16% less wealth as of the second quarter of 2022. Despite these trends, less-educated groups have seen stronger growth during the past two years and have held onto more of that growth than college-headed families in in the past two quarters.

Average Real Wealth Gaps by Education

Line chart showing household wealth per $1 of bachelor's degree wealth for some college, high school, no high school

SOURCES: Distributional Financial Accounts and Institute for Economic Equity calculations.

NOTES: College represents families with at least a bachelor’s degree; other education levels represent the families’ highest completed education. Vertical bars indicate recessions.

Given the fast growth in average wealth for college-headed families relative to families who are not college educated, real educational family wealth gaps have grown over the past three decades. As of the second quarter of 2022, the ratio between families headed by someone with some college education (but no four-year degree) and families headed by a college graduate was 32 cents per $1. The ratio between someone with a high school diploma and a bachelor’s-level education was 25 cents per $1, and the ratio between someone with less than a high school diploma and a bachelor’s-level education was 10 cents per $1.

Average Real Wealth by Education, Second Quarter of 2022

Bar chart showing household wealth in 2021 dollars for college, some college, high school, no high school

SOURCES: Distributional Financial Accounts and Institute for Economic Equity calculations.

NOTE: College represents families with at least a bachelor’s degree; other education levels represent the families’ highest completed education.

This bar chart shows the average wealth for families headed by someone with a four-year college degree, some college but no degree, at most a high school diploma and less than a high school diploma in the second quarter of 2022. In that quarter, the college group had about $1.3 million, $1.4 million and $1.6 million more family wealth, on average, than those groups of some college, high school, and no high school, respectively. Despite recent weakening, average real family wealth levels were near historical highs, with the exception of the no high school group.

About the Authors
Ana Hernández Kent
Ana Hernández Kent

Ana Hernández Kent is a senior researcher with the Institute for Economic Equity at the Federal Reserve Bank of St. Louis. Her research interests include economic disparities and the role of systemic biases and historical factors in wealth outcomes. Read more about Ana’s research.

Ana Hernández Kent
Ana Hernández Kent

Ana Hernández Kent is a senior researcher with the Institute for Economic Equity at the Federal Reserve Bank of St. Louis. Her research interests include economic disparities and the role of systemic biases and historical factors in wealth outcomes. Read more about Ana’s research.

Lowell Ricketts
Lowell R. Ricketts

Lowell R. Ricketts is a data scientist for the Institute for Economic Equity at the Federal Reserve Bank of St. Louis. His research has covered topics including the racial wealth divide, growth in consumer debt, and the uneven financial returns on college educations. Read more about Lowell's research.

Lowell Ricketts
Lowell R. Ricketts

Lowell R. Ricketts is a data scientist for the Institute for Economic Equity at the Federal Reserve Bank of St. Louis. His research has covered topics including the racial wealth divide, growth in consumer debt, and the uneven financial returns on college educations. Read more about Lowell's research.

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Views expressed are not necessarily those of the St. Louis Fed or Federal Reserve System.

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