The Great Rebound

Many Americans struggled after the housing collapse a decade ago, but one generation was hit especially hard: Gen Xers, who were more likely to buy at peak prices, lost a greater portion of their wealth than other generations.

The median net worth of Generation X households—those ages 27 to 42 in 2007—fell 38 percent ($24,200) between 2007 and 2010, compared to 26 percent for the median Baby Boomer household (ages 43 to 61 in 2007) and 14 percent for the Silent Generation (62 to 79 in 2007). Over on the other side of the ledger, the median Millennial household (11 to 26 in 2007), with a smaller stake in the housing market and therefore lower net worth, actually gained a little bit of wealth ($1,300, or 23%) during that time.

But big losses sometimes foretell big recoveries. A Pew Research Center analysis of Federal Reserve data found that Gen Xers managed to recoup their lost wealth and in fact rebounded more than other generations. The median Gen X household’s net worth increased 115 percent ($45K) from 2010 to 2016, while the median wealth of Baby Boomer and Silent Generation households remained stuck below 2007 levels.

Generation X’s revival stemmed from a variety of factors, among them growth in home equity and personal income.

For the first, increasing home values, mortgage modifications, and even foreclosures—after all, a reduction in the number of homeowners with negative equity in their homes boosts wealth—allowed Gen X homeowners to recover from their losses. And they were the only generation to do so.

Second, Gen Xers—in their prime working years during this period—earned, saved, and invested. Their hard work literally paid off as their median financial assets doubled between 2010 and 2016. Data show that this momentum has continued; what’s more, Gen Xers had the highest median adjusted household income ($73,200) as of 2016—more than Baby Boomers ($71,900), Silents ($59,600), and Millennials ($50,800).

To learn more, read the 2018 Pew Research Center analysis, “Gen X rebounds as the only generation to recover the wealth lost after the housing crash.”