One thing worth noting about lower income wealth levels are that most households include expected social security benefits when making the wealth vs. consumptio

One thing worth noting about lower income wealth levels are that most households include expected social security benefits when making the wealth vs. consumption decision. A thought process might go something like this: "Should I buy the CD or pay my daughters tuition? I expect Social Security to pay half of what it does now in inflation adjusted terms by the time I retire, so I need X in real income to maintain my lifestyle taking that into account. Running the numbers I can afford to help her" Since social security is relatively tiny for the wealthy and large for the poor, it biases against wealth generation by the poor since they have better things to spend it on. This is absolutely a crude estimate but retiring at 66 making 45k pays 1235 a month. Assuming a median age of death of 85, and a 4% annual interest rate compounded monthly, that's 1235/0.003333-1235/0.003333(1/1.003333^(1220))~= $200,000 at the time of retirement or roughly $100,000 at middle age. If there are 150 million people in the workforce that's $150 trillion in uncounted wealth. The total household wealth as estimated now is $55 trillion. So by that metric 3/4 of the wealth of the US is tied up in expected social security benefits. That seems really high to me, obviously I've made some big assumptions about length of payments received, median income, etc. but I think it'd be tough to justify excluding a stream of payments that last until you die, even if we are expecting cuts to the program in the near future. Also, it looks as though the middle class and poor are actually wealthier than is assumed by the survey respondents using this metric, the opposite conclusion of the article.