The 2014 Credit Suisse Global Wealth report listed Americans’ median wealth at $44,900 per adult, which places the country 19th in the report’s rankings – below Japan, Canada, Australia and much of Western Europe.
Meanwhile, super rich Americans skew average upwards: the US has 42% of the world's millionaires, and 49% of those have assets worth upwards of $50 million. This means the average wealth in the US remains at $301,000 per adult: enough to rank the country fourth in the world.
Real estate is one factor: in Europe, home ownership rates are higher than in the US, and borrowing rates are lower. “It's easier for Americans to borrow money, which eats away at their net worth”, says Jim Davies, an economics professor at Western University in Ontario, Canada, and co-author of the Credit Suisse report.
Wages have also stagnated in the US, with median household income falling from $56,080 in 1999 to $51,017 in 2012, according to the Census Bureau's most recent statistics. Americans have to pay more out of pocket for basics, such as health care and higher education, reducing their ability to save.
Image credit: Ed Yourdon / Flickr
Investors are looking to emerging markets for the most promising growth in opportunities.
“Americans tend to think of their middle class as being the richest in the world, but it turns out, in terms of wealth, they rank fairly low among major industrialized countries”, said Edward Wolff, a New York University economics professor who studies net worth.
Will the next half century see the US lose out on talent, as entrepreneurs look beyond saturated markets at home?