The Covid-19 pandemic has contributed to a record high in the net worth of German households, reaching €316,500, according to a study by the Deutsche Bundesbank. The study surveyed 4,119 households and found that the average net worth had increased by €83,600 over the past four years and €121,300 over the past decade. The increase in net worth was attributed to savings made during the pandemic due to limited consumption opportunities. The net worth includes financial assets, such as deposits and stocks, as well as tangible assets, such as real estate and cars, with debts subtracted.
The study also found that households with lower incomes primarily held their financial assets in low-risk savings accounts and other investment forms, while those with more extensive assets held real estate and company shares. The median net worth, which represents the middle value when data is sorted by size, increased from €70,800 in 2017 to €106,600 in 2021. However, this value is still lower than the median net worth of other countries with comparable data, such as Italy and Spain. The wealthiest 10% of households in Germany hold 56% of the total net worth, while the bottom half only holds 3%.
While the pandemic has reduced relative inequality measures, such as the Gini coefficient, the sustainability of this trend remains uncertain. The study suggests that the reduction in inequality may be due to additional savings made during the pandemic. The Gini coefficient in Germany is still higher than in Italy and Portugal, despite a slight decrease. The study highlights the need for continued efforts to address wealth inequality in Germany.
