US household wealth soars to a new record as stocks march higher
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U.S. household wealth smashed another record at the start of 2024 thanks to a surging stock market, according to a Federal Reserve report published Friday.
Household net worth rose about 2.9%, or $5.1 trillion, in the three-month period from January through March to a new high of $160.8 trillion, the Fed said in its quarterly snapshot of the balance sheets of households and businesses.
The increase was primarily driven by a $3.8 trillion increase in the value of equities held directly or indirectly through mutual funds, life insurance policies or retirement accounts. Since the start of the year, the benchmark S&P 500 is up about 13%, while the Dow Jones Industrial Average has climbed 3.2%. The tech-heavy Nasdaq Composite, meanwhile, has increased about 16% year to date.
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The value of real estate held by households climbed about $900 billion, also to a record, as high mortgage rates and limited supply pushed prices even higher.
A man strolls past the New York Stock Exchange. (Spencer Platt/Getty Images / Getty Images)
At the same time, consumers and businesses ramped up their borrowing during the first quarter, even as they continued to face interest rates that are at their highest level in 23 years.
Business debt grew at a 4% annualized rate in the first quarter, buoyed by robust net issuance of debt securities. Mortgage debt expanded by 2.1%, and non-mortgage consumer credit grew by 1.8%. Federal government debt increased a 6.2% pace, while state and local government debt expanded by 3%.
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