American households saw another major expansion in net worth as well as significant increases in debt and credit.
Source: US Federal Reserve
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A significant surge in stock market earnings contributed to a total household net worth increase to $141.7 trillion through the second quarter of 2021.
The increase of $5.85 trillion, 4.3% from the first quarter, was good after the economy continued to rebound from the Covid-19 pandemic. The annual net worth rose by 19.6% from one year ago.
A significant portion of the net wealth comes from stock earnings that accounted for $3.5 trillion of the gains as growth in real estate value was responsible for $1.2 trillion.
Consumers’ debt rose to $17.3 trillion as of June 30%, a quarterly increase of 7.9%. Consumer credit increased at an annual rate of 8.6%, while mortgage debt rose by 8%.
Household debt was similar to the federal government, which ended the quarter up 9.5% higher, at $28.5 trillion. The state and local government debt rose by 3.1%, a slowdown from the 3.5% rate in the first quarter.
Non-financial business debt rose much slowly, rising nearly 1.4% to $18 trillion. Total non-financial debt outstanding across all sectors was $63.3 trillion, a quarterly increase of 6.4%, down from a 6.7% increase in the first quarter.