It’s a tale of two Americas: domestic households’ net worth rose nearly 7% in the second quarter of 2020 to $119 trillion, according to the Federal Reserve, even while millions saw their jobs disappear and incomes wane. Through the end of March, the richest one-tenth of Americans owned more than two-thirds of the nation’s wealth, as reported by the Associated Press. The top 1% owned 31%.
In the same period, the amount of money in checking accounts grew by 33% to $1.8 trillion and savings accounts grew by 6.1% to $11.2 trillion. Many Americans reduced spending and others received government financial assistance in enhanced unemployment and government stimulus checks.
Gaps in net worth along racial lines have been exacerbated by the economic fallout of the pandemic. “Much smaller financial resources mean that many nonwhite households are forced to sharply cut spending after a job loss or reduced incomes,” according to the AP. “Research by economists Peter Ganong and Damon Jones at the University of Chicago found that Black Americans cut spending 50% more than whites when faced with the same income losses. Hispanics reduced theirs by 20% more.”
Americans' household stock portfolios tallied up to $5.7 trillion during the April-June quarter, according to the report. Home values grew by $500 billion.