Method: For each SCF age cohort, computed the 10th/25th/50th/75th/90th percentile of household net worth (total assets − total debts).
Mixeygoat on
Makes sense, due to compounding growth from investments including home values
spiderweb91 on
I mean, of course. What do you think the wealth gap is at 4?
KrzysziekZ on
I know what an age of a person is. But of a household? Is it average of the adults?
mdwespam on
Maybe I’m out of the loop, but since when did it become the norm to make an insight the title of a graph? I see it a lot on this sub.
IAmABoss37 on
Well yes, when two numbers grow proportionately, so too does the difference between them.
darkbyrd on
Alternate title: the power of compound interest.
Start early.
CoopertheFluffy on
The wealth gap between people on the same age group is just how wealthy the wealthiest people are at those ages, because the poorest have nothing at any age.
puzzlebuns on
Its supposed to grow exponentially with age. If you have one person building a retirement fund throughout their life and one person perpetually living paycheck to paycheck, the former will outpace the latter exponentially in wealth, all things being equal.
Its a very clear and informative chart, I just dont agree with the implication I get from your comments.
ballade4 on
Imagine being age 65 and not being at least 8x more successful than you were at 25.
10 Comments
Source: Federal Reserve [2022 Survey of Consumer Finances](https://www.federalreserve.gov/econres/scfindex.htm) (~4,600 households, sample-weighted).
Tools: Python, matplotlib.
Method: For each SCF age cohort, computed the 10th/25th/50th/75th/90th percentile of household net worth (total assets − total debts).
Makes sense, due to compounding growth from investments including home values
I mean, of course. What do you think the wealth gap is at 4?
I know what an age of a person is. But of a household? Is it average of the adults?
Maybe I’m out of the loop, but since when did it become the norm to make an insight the title of a graph? I see it a lot on this sub.
Well yes, when two numbers grow proportionately, so too does the difference between them.
Alternate title: the power of compound interest.
Start early.
The wealth gap between people on the same age group is just how wealthy the wealthiest people are at those ages, because the poorest have nothing at any age.
Its supposed to grow exponentially with age. If you have one person building a retirement fund throughout their life and one person perpetually living paycheck to paycheck, the former will outpace the latter exponentially in wealth, all things being equal.
Its a very clear and informative chart, I just dont agree with the implication I get from your comments.
Imagine being age 65 and not being at least 8x more successful than you were at 25.