By Alison Kuznitz, State House News Service
Massachusetts families held a median net wealth of more than $370,000 last year, according to a new study that found this metric varies dramatically across key factors like race, age, educational attainment, homeownership and place of residence.
Just over a third of families also said they would be unable to cover a $400 emergency expense such as car repairs or an illness with cash or “its equivalent” in 2025, according to the report released Wednesday by the Federal Reserve Bank of Boston.
The Boston Fed worked with The Boston Foundation — plus the Barr Foundation, Eastern Bank Foundation and the Greater Boston Chamber of Commerce — on the Massachusetts Economic Conditions and Household Opportunity Survey that captures household assets and debts, and whether Bay Staters have sufficient wealth reserves to cope with “unstable prices or unexpected expenses.” Sent to 32,817 randomly selected Massachusetts addresses, the survey yielded 5,018 responses.
The survey highlighted long-standing racial wealth gaps.
White families had an estimated median net wealth of $549,200, compared to $305,000 for Asian American, Native Hawaiian and Pacific Islander families. Median net wealth was just $1,200 for Hispanic families and $7,800 for Black families. About 41% of Hispanic families and 31% of Black families held zero or negative net wealth.
“Having wealth is the ability to financially navigate an unexpected job loss, a serious illness, or buy and/or maintain a home,” Barr Foundation CEO Ali Noorani said. “It is the difference between one’s ability to live to their fullest potential and a trajectory that mires them in debt.”
Noorani said the swath of families who cannot afford a $400 emergency expense is “a clear indication to us that economic inequity is so deeply rooted that solutions can only be found in collaboration.” The wealth gap can be alleviated, he said, as “sectors and ideologies” work to remove barriers and boost access to capital.
In Greater Boston, 33.4% of families said they could not pay an unexpected $400 expense. That figure climbed to 50.1% for families in Gateway Cities. There are 26 Gateway Cities with populations ranging between 35,000 and 250,000 people, and median household incomes and average educational attainment rates that are below the state average, according to the report.
Researchers examined various financial assets that contribute to net wealth, including checking, savings and money market accounts; certificates of deposits, stocks, bonds and mutual funds; workplace retirement accounts; IRA and Keough accounts; annuities and trusts; and cash value of life insurance. Non-financial assets include primary residence equity, other real estate equity, vehicle equity and business equity. For debts, researchers assessed credit card debt, student loan debt, medical debt, legal debt, loans from relatives and friends, and other installment loans.
The report found the estimated median family net wealth was $374,000, but the 25th percentile was just $10,000. That means a quarter of the commonwealth’s population had wealth at or below $10,000. Meanwhile, the 75th percentile was $1.09 million.
Nearly 16% of respondents reported no wealth or “negative” wealth, in which their debts exceeded the value of their assets.
High wealth was associated with factors like higher education levels, homeownership and families with older adults. For families in which a respondent or spouse/partner held a graduate degree, the median net wealth was $947,400. As for homeowners, median family net wealth was $790,500. Families in which the respondent or spouse/partner was 65+ held median net wealth of $702,500.
Median net wealth was only $11,000 for families in which neither the respondent or spouse/partner earned higher than a high school diploma or GED. Renters held only $1,500 in wealth and younger families — in which the respondent or spouse/partner was under 45 — had $97,000.
The report found median family wealth was highest in rural parts of Massachusetts ($465,000), but trailed closely by wealth in suburban areas ($447,100). In cities, the median family wealth was $110,000 and roughly a quarter of families held zero or negative net wealth.
About a third of Massachusetts families had a will or estate plan, according to the report.
“This well-designed, far-reaching, and rigorously documented survey by the Boston Fed allows us to face the challenge of equity with new vigor and knowledge that our work to strengthen homeownership, improve educational outcomes, and support small businesses can and will over time strengthen the economic well-being of people across the Commonwealth,” Boston Foundation CEO Lee Pelton said.
