WASHINGTON (AP) — A surging stock market and rebounding home prices boosted Americans' wealth to a record in the final three months of last year, though both trends have slowed so far in 2014.
Household net worth jumped nearly $3 trillion during last year's fourth quarter to $80.7 trillion. Stock and mutual fund portfolios gained nearly $1.7 trillion, or 9 percent, according to a Thursday report by the Federal Reserve.
The value of Americans' homes rose just over $400 billion, a 2 percent gain. And checking account balances, pensions plan assets and retirement savings, such as 401(k)s, also increased.
Strong wealth gains tend to trigger more consumer spending, a critical fuel for economic growth. Higher household net worth is one reason economists have forecast that the U.S. economy will accelerate later this year.
Household wealth, or net worth, reflects the value of homes, stocks, bank accounts and other assets minus mortgages, credit cards and other debts.
Last year, home prices nationwide rose by the most in eight years. And the Standard & Poor's 500 index of large stocks jumped 32 percent. So far this year, home-price gains have slowed, and the S&P 500 has risen just 1.4 percent.
Rising home prices are helping people rebuild ownership stakes in their homes. The equity that Americans as a whole have in their homes has reached 51.7 percent, the highest point since before the recession began. That's up from a record low of 36.5 percent in the first three months of 2009.
The Great Recession hammered Americans' net worth, cutting their overall wealth to $55.6 trillion in the first quarter of 2009. That was 19 percent below the pre-recession peak of $68.8 trillion.
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