According to research recently released by the Pew Research Center, it’s definitely better for your finances to be over 65. In a recent report titled “The Old Prosper Relative to the Young,” Pew announced that there is a “rising age gap with regard to economic well-being.” A group of researchers examined financial data for various age groups over time, focusing particularly on 1967, 1984, 2005, and 2009-2010[1].
The economists and analysts involved in the study noticed that older households appeared to be getting richer between 1984 and 2009 despite the recession while younger households appeared to be on the decline.
Median net worth rose in “older” households (age not specified, but a 2011 report on similar subject matter defined “older” as 65 and older and everyone else as “younger”[2]) by 42 percent during that time period while median net worth declined in “younger” households by 68 percent. The gap in worth widened as well over time. In 1984, the older households were worth $108,000 more than younger households. By 2009, that number had climbed to $166,832.
Pew, along with the Bureau of Labor Statistics (BLS), released some other troubling numbers this week as well. According to the BLS, 4.9 million Americans are presently “long-term unemployed,” meaning that they have been jobless for more than 27 weeks, and 7.6 million Americans are underemployed, meaning that they have taken part-time positions because they cannot get full-time work[3]. The BLS suggests that these numbers indicate that today’s employment levels may be trending into a “way of life” instead of a trend to be reversed.
Unemployment trends could be playing a large part in the perceived “wealth” of older households. In reality, it could simply be that older households have had more time to amass worth than younger households, which are not able to gain solid footing thanks to today’s employment issues. Are you concerned by Pew’s numbers?
[1] http://finance.yahoo.com/news/the-old-get-richer–the-young-get-poorer.html
[2] http://www.pewsocialtrends.org/2011/11/07/the-rising-age-gap-in-economic-well-being/
[3] http://www.counterpunch.org/2013/05/03/the-great-restructuring/