Class Discussion or Written Assignment: The Rising Age Gap in Financial Well-Being, Part 1

Principle 10: Just Do It!, introduced in Chapter 1, talks about the importance of not procrastinating – of getting started saving when you’re young and building up your wealth.  Unfortunately, that’s much easier said than done, and as a recent Pew Research Center Survey points out, there is an increasingly large gap between the wealth of the young as opposed to the old in America.

The recent Pew Research Center Report, “The Rising Age Gap in Economic Well-Being: Wealth Gap by Age” shows that while the household median net worth was $71,635 in 2009, it was only $3,662 for households headed by adults younger than 35, while for households headed by adults 65 and older the median net worth was $170,494.  Even more striking in this study was the fact that the median net worth for households headed by adults under 35 dropped by 68% between 1984 and 2009 while the median net worth for households headed by adults 65 and older went up by 42% over this same period.  The entire report is available at

All this points to an age dimension in wealth inequality – with older Americans gaining in terms of wealth relative to younger Americans.

Class Discussion or Assignment:

1.  Read through the Pew Research Center Report, “The Rising Age Gap in Economic Well-Being: Wealth Gap by Age.”   As we learned in Chapter 8, housing is a major component of wealth for Americans, and as a result, any change in the price of housing has a major impact on American wealth.  How has the recent drop in home prices impacted the different age groups of Americans?  Be prepared to discuss your findings in class or write a short paper on this question.

2.  Do you expect to buy a house soon after you graduate?  Are you worried about where home prices are headed?  Be prepared to discuss your opinion in class.

 

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