Trend Wealth growth shifts from real investment to paper gains
Summary
MGI decomposes 2025 household wealth growth and finds only 20 percent came from net new investment against a 30 percent average for 2000-24, while nearly 60 percent came from asset price growth beyond general inflation plus negative net worth positions in other sectors, up from about one-third on the 2000-24 average.
Classification
Main topicMacroeconomy & Finance
Region menusGlobal
Impactscope:global
Time horizon0-3 years (2026-07-26)
Last updated2026-07-29 04:49:52
Evidence 2
- The global balance sheet 2026: Imbalance and divergence McKinsey Global Institute page=29;section=Has wealth growth been 'healthy?' 2026-07 accessed 2026-07-26
- The global balance sheet 2026: Imbalance and divergence McKinsey Global Institute page=5;section=Introduction 2026-07 accessed 2026-07-26
Observed signals 6
- SignalEquity produced 57% of new household wealth in 2025 against 15% from real estate
- SignalEquity was the largest source of wealth creation in nearly every major economy in 2025
- SignalHousehold wealth growth accelerated to 7.3% in 2025 from a 5.9% long-run average
- SignalJapan posted the largest wealth upswing, driven mostly by valuation gains after decades of near-zero inflation
- SignalOnly 20% of 2025 wealth growth was real capital formation; drivers split by country
- SignalUK and Canadian wealth growth slipped in local currency while Canadian equity lifted paper wealth
Part of issues 3
- IssueAn elevated balance sheet unwinds through productivity, inflation, a reset, or not at all3 trends · 1 signals
- IssuePaper wealth widens wealth inequality and raises the entry barrier to asset markets1 trends · 1 signals
- IssueProlonged valuation gaps distort capital allocation and feed inequality before correcting1 trends · 1 signals
Relation types: constitutes · supports
Public id: fm-9ec1a9b67eea