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% ($24,200) between 2007 and 2010, compared to 26% for the median Baby Boomer household (ages 43 to 61 in 2007) and 14% 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% ($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.”