Households’ Net Worth Accumulation Patterns and Young Adults’ Financial Health: Ripple Effects of the Great Recession?

Wealth as Security: Growth Curve Analyses of Household Income and Net Worth During a Recession

“…While some low-income households saw substantial increases in the pace of income and net worth change, others likely saw decreases. These results fit with media coverage of the Great Recession, which emphasized gaps between those employed in winning and losing industries (U.S. Bureau of Labor Statistics 2012), as well as with research documenting changes in net worth with the recession (Friedline et al 2014 Consistent with Hughes and Seneca (2010), rate of income change differed by region of the country; as shown in Table 3, low-income households in the North Central and Southern regions had a significantly lower rate of income change than those in the Northeast. Older age was associated with a significantly lower rate of income change than younger participants, consistent with the idea that low income households bumped up against an income ceiling.…”

“…Specifically, they found that net worth of the top 50 wealthiest Americans fell by 17% from 2008-2009, while it fell 37% among the top 1% wealthiest households (Wolff et al 2011: 150). Consistent with this finding, Frank (2013) High quality research has already documented trends in inequality with the recession (e.g., Emmons and Noeth 2012;Pfeffer et al 2013;Shapiro et al 2013;Friedline et al 2014). …”

“…More recent research has suggested the Great Recession further increased inequality along a variety of dimensions, including wealth, income, age, race, and education (Emmons and Noeth 2012;Pfeffer et al 2013;Shapiro et al 2013;Friedline et al 2014). For example, using PSID data, Pfeffer and colleagues (2013) found that low income and minority households with relatively low levels of education lost a higher proportion of their wealth than others.…”

Emerging Adults’ Financial Well-being: A Scoping Review

“…In some cases, the income was considered in addition to the information on the emerging adult's socioeconomic status (such as education, income inequality, and job stability). Finally, other detected ways to measure the emerging adults' objective financial well-being were the presence of a checking or savings account under their name and the amount of dollars saved in it (Friedline et al 2014). Additionally, in Rutherford and Fox (2010), the total assets (continuous, in dollars), the health insurance coverage (1 if covered; 0 if otherwise), the liquidity ratio (1 if liquid assets ⁄ monthly debt payments >2.5, 0 if otherwise), the asset allocation ratio (1 if liquid assets/net worth >0.15, 0 if otherwise), and the combined ratio (1 if both liquidity and asset allocation ratios have been met, 0 if otherwise) had been used.…”

“…Among them, only Smith (2005) collected these data on financial well-being from different participants at each time point. Finally, in Reynolds et al (2007), LaVeist et al (2010), Friedline et al (2014), and Oman et al (2015), even if data were collected more than once, the financial well-being variable was retrieved only once.…”