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Don’t Blame the Boomers

Baby boomers aren't the problem -- the rich are.

Alan Huett / Flickr

I was inspired by this piece in the Boston Globe, about how baby boomers have ruined everything, to go into the Survey of Consumer Finances and see just how well the boomers are actually doing, at least as far as wealth goes. The answer, as with all things, is it depends on what class of boomer you are talking about. Rich boomers are doing well. Poor boomers are not.

For these figures, I used the 2013 Survey of Consumer Finances and isolated households whose head was between the ages of forty-nine and sixty-seven in 2013 (meaning they were born between 1946 and 1964). The dollar figures are all in 2013 dollars.

Here is net worth (assets minus liabilities, not counting vehicles) for various percentiles of the boomer distribution.

The bottom 10 percent of boomers have less than nothing — they have more debt than they have assets. Those near the bottom 10 percent are also not doing particularly well, as the twentieth percentile has less than $1,500 of wealth stored up.

When you get to the median, which is typically the only figure you get from most wealth analyses, it starts to look somewhat respectable at $131,000. Though even that might not seem that respectable when you understand that these folks are nearing retirement and $130,000 is probably not going to cut it.

The top of the boomers are of course doing amazingly, with the ninety-fifth percentile boomer sitting on $2.7 million.

Here is the same table, but this time with home equity stripped out of the equation. So it’s all of the non-home wealth of the boomer population broken down by percentile:

When you take the home equity out, it turns out the bottom 20 percent has nothing. The median falls down to $52,000. But the top of the boomer hump is still coming in at over $2 million.

I offer this calculation with the home equity taken out not to suggest it is a better indication of boomer wealth. It’s not. But if the dream of getting old and retiring is that you stay in your home and live off your pension and savings, then it is useful to take the homes out to see what is actually left over. And it’s really not a whole lot, for most boomers.

Despite popular misconceptions to the contrary, it seems to me that the boomers are not the problem. The rich are.