As young Americans struggle to build wealth, retirees over the age of 70 have seen their net worth skyrocket since the pandemic.

According to Fed data, older baby boomers have added more than $14 trillion to their net worth since the end of 2019. They now account for 30.4% of the country’s overall net worth, despite only being 11% of the population.

Older boomers are typically retired and own a lot of stocks and real estate compared to younger generations. That’s how they were able to build so much wealth since Covid.

Today, those age 70 and older own nearly 38% of the country’s stocks and mutual funds—the highest since record-keeping began in 1989. They also own nearly 25% of the country’s real estate.

The wealth gap between older boomers and younger Americans becomes more apparent when comparing each generation’s overall share of the country’s net worth.

Americans age 40 and younger own just 6.7% of the country’s net worth. Those aged 40 to 54 account for 20.5%.

And while people in the 55 to 69 age bracket own 42.4% of the country’s net worth, their share has declined since the pandemic, per Fed data.

Although boomers have built their wealth steadily by investing in assets throughout their lifetime, they’ve benefited from impeccable timing.

Right place, right time

Depending on how you calculate it, the average baby boomer has a net worth between $970,000 and $1.2 million, according to Fortune.

This generation was around following WWII, when they enjoyed a prolonged period of strong economic growth and prosperity, not to mention affordable housing and the introduction of savings plans like the 401(k).

Today, boomers have amassed an $82 trillion nest egg—and nearly one-quarter was built through homeownership.

Boomers own a staggering 38% of the country’s residential real estate. Perhaps more surprising is the fact that they remain active in homebuying.

As Creditnews reported, boomers have overtaken millennials in home purchases since early 2023—despite the latter being in their prime working and home-buying age.

Since they own so much of the housing stock, boomers also benefited from the Fed’s aggressive rate cuts and money printing during the pandemic. They were able to refinance or purchase additional property at rock-bottom rates—all while demand and housing costs skyrocketed.

Housing has emerged as a major sticking point in the wealth gap, with more and more younger generations priced out of the market entirely.

First-time buyers struggle

Whereas baby boomers are flush with cash and home equity, younger generations need a lot more financing to afford their first home. This reached a boiling point in 2023 when mortgage rates hit multi-decade highs.

“We are still talking about an incredibly difficult market for first-time buyers to enter, even if there's slightly less competition,” said Jessica Lautz, deputy chief economist at the National Association of Realtors.

“If there's a multi-offer situation, an all-cash buyer or someone who has a lot of equity is likely to win. And that person is going to be older,” she explained.

According to the Urban Institute, a social policy think tank, it’s time to rethink homeownership as the American Dream.

“Data from the Decennial Census, the American Community Survey, and the U.S. Department of Housing and Urban Development show that median-home-price-to-median-income ratios have gone up from 6.1 in 2000 to 8.5 in 2021, making homeownership access more challenging, even for those who earn moderate incomes,” Urban Institute researchers wrote.

Creditnews Research recently reported on the best and worst metro areas for first-time home buyers in 2024. The biggest driver in the affordability crisis was mortgage costs relative to income, which remains elevated across most major cities.