Children and Wealth Contexts in the United States: Differences by Household Type.

Abstract

Objective: To examine whether the wealth context of households with children, marked by high rates of inequality and low levels of wealth for those at the bottom, also applies to elderly households and households without children.

Background: Children experience higher income poverty than elderly or working-age adults, but wealth and wealth deprivation comparisons across these groups have not been done. Exploring these differences may reveal another economic dimension on which households with children are uniquely vulnerable and inform policies aimed at financial stability.

Methods: Data are drawn from the 1989 to 2022 waves of the Survey of Consumer Finances (N = 58,148 households), a nationally representative triannual survey of household wealth. The study tracks trends in wealth inequality, wealth holdings, and net worth poverty across three household types: non-elderly households with children, non-elderly households without children, and elderly households.

Results: Households with children exhibit higher wealth inequality, lower wealth levels, and greater net worth poverty rates than the other two household types. Disparities between elderly and child households are particularly large, with child households having pennies on the dollar for every dollar of elderly wealth. These disparities increased over time, except in the early 2020s, when gaps narrowed.

Conclusion: Like income, wealth is another economic context in which child households compare unfavorably to households without children and elderly households. However, government spending during the pandemic coincided with increases in child household wealth and decreases in net worth poverty, suggesting that child wealth contexts are not fixed.