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Wealth levels rise by more than $1 trillion

December 13, 2010 - A new report shows that household wealth saw a healthy gain during this year's third quarter, an encouraging sign that more consumers are getting a better hold of their finances and could consider moving up in the near future.

The Federal Reserve reported that the net worth of households and individuals around the country climbed 2 percent during the third quarter, a rise of $1.2 trillion after falling $1.4 trillion the previous quarter. Additionally, consumers continued to do more to save money and cut back on spending during the quarter. As a result, household debt fell for the tenth consecutive quarter.

Falling home prices did hold back some of the growth, but increased savings and wealth could mean more Americans can afford a down payment and may soon be hiring moving companies.

"Households are still shoring up, cleaning up their balance sheets, getting to a level they're more comfortable with and that's an ongoing process," Julia Coronado, chief economist for North America at BNP Paribas in New York, told Bloomberg. "Housing has now become a headwind."

Improved wealth levels also come at a time when unemployment seems to be improving as more companies hold on to workers and some Americans finish off successful job searches. The Labor Department reported that just 421,000 people filed unemployment claims this week, down 17,000 from a week earlier.

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