6 Wealth Inequality Among Older Americans

Using the AHEAD study, this article examines the wealth distribution among American households with a member at least 70 years old. Household wealth is quite unevenly distributed among older American households. Those households in the top 10th percentile of the wealth distribution have 2,500 times as much wealth as those at the lowest 10th percent. This sharp wealth disparity relative to income dispersion is the dominant reason why older minority households have ac-cumulated so little wealth compared to White households. Wealth varies by a factor of seven to one when both spouses are in poor health compared to when they say that they are in excellent health. Finally, AHEAD data on bequest inten-tions suggest a bifurcated bequest motive. Most older households plan to bequeath a modest financial inheritance, but about one-quarter expect to leave inheritances worth $100,000 or more. THE process of asset accumulation and depletion at olderages is a central issue on which any evaluation of the well-being of the elderly population depends. Our current knowledge of this process is limited because most social sci-ence surveys either did not include wealth modules or mea-sured assets quite poorly. This problem is much more severe during the postretirement years because of inadequate sam-ple sizes in this age group in more general purpose surveys