Record Incomes Mean Little in Debt Era

Heating up.

Photographer: Andrew Harrer

The hurricanes will be an economic blip beginning in the fourth quarter. Or they will devastate thousands of at-risk households and pack the potential to sweep consumption out to sea. Well, which is it? What if it’s both?

Much has been made of the recent Census data that found median household income had finally retaken record levels, surpassing the previous peak reached in 1999. Although back-to-back gains are welcome news, the $59,039 income figure belies vast discrepancies in lifestyles.

Not only have income gains been widely disparate depending on how much you earn, income inequality widened to a record last year. The highest earners continue to enjoy income growth that’s three to four times that of the lowest earners, while their exposure to the stock market and other risky assets ensures that their net worth continues to rise at a healthy clip. But even these statistics fail to capture the full divide between the so-called haves and have-nots.