(Bloomberg) -- Most don’t work anymore, but Americans age 70 and older have seen their share of collective wealth surge during the pandemic.
As a group, these older baby boomers have accumulated more than $14 trillion in additional net worth since the end 2019, based on Federal Reserve data. Their share of the country’s wealth has jumped to a record 30% last quarter, even though they account for 11% of the population.
The aging population helps explain some the gains: There are about 2.3 million more people over 70 in the country than in 2019. But one major driver was the surge in home values and stocks during the pandemic, which benefited older generations most likely to own a house — or two — and hold equities or mutual funds.
Although people who are over 70 are typically retired, a rising portion of that age group is still working. The share of adults age 65 and more in the labor force reached an historic low of 10% in the mid-1980s but has since almost doubled, according to Bureau of Labor Statistics data, even after many retired early at the onset of the Covid-19 health crisis.
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The Fed data also show that Americans between 40 and 70, decades when people usually reach their earnings peak, are holding a smaller share of household wealth than in 2019.
Looking at a longer period, the sharp increase in wealth for older people is even more pronounced. In 25 years, the aggregate wealth of Americas age 70 and older has risen six-fold to $43.3 billion. Over the same time period, the wealth of those under age 55 rose by about 2.5 times.
Older Americans also have been the beneficiaries of good timing with the stock market, despite recessions along the way. Since 2019, those age 70 and older have collectively gained about $5 trillion in equity gains. Close to 38% of the nation’s corporate equities and mutual fund shares were held by people in that age group in the third quarter, the highest share on record in data going back to 1989.
And the gains continued for equity holders this quarter, as stocks rallied on the expectation that the US central bank will start cutting interest rates in 2024.
The ultra rich in the country have help boost the average equity holdings of people over 65 to about $1.8 million in 2022, according to separate data from the Fed.
The data is masking inequalities and the Covid-19 era has widened the divide between those who owned assets like a house and stocks pre-pandemic and those who didn’t. Millions of older Americans face hardship, with more than 1 in 10 over 65 in the US living in poverty.