In 2023, the Bundesbankonce again conducted its panel on household finances (PHF) to survey households’ wealth, debt and income. The study found that holdings of wealth, measured as average net wealth per household, grew slightly in nominal terms between 2021 and 2023. Nevertheless, net wealth remains at a higher level in both nominal and inflation-adjusted (real) terms than in 2017, when the Bundesbank carried out its last survey before the COVID-19 pandemic.

In 2023, households in Germany had average net wealth of around €324,800. This is around 3% more than in 2021 (€316,500), the Bundesbank’s experts write in their recently published report on the study. Adjusted for inflation, however, net wealth declined from €268,700 to €239,200 during this period. The median, which marks the middle of the wealth distribution, also declined from €90,500 to €76,000 in real terms.

Over the longer term, however, households’ net wealth has increased in both nominal and real terms. Between 2017 – the last pre-pandemic survey – and 2023, mean net wealth rose by 40% in nominal terms and by 13% in real terms. The median rose by 46% in nominal terms and by 18% in real terms over the same period.

Wealth inequality in Germany unchanged, but still high

A classic measure of inequality is the Gini coefficient, which can take a value between 0 (minimum inequality) and 1 (maximum inequality). Despite high inflation rates and the significant rise in interest rates, the Gini coefficient for net wealth in Germany has remained virtually unchanged since the last wave of the survey in 2021, standing at 0.724. Spain and Italy, for example, have lower Gini coefficients, which means that wealth is more evenly distributed in those countries.

Participation in the capital market rises

Ownership of real estate and businesses continues to be strongly correlated with high levels of wealth. Riskier financial assets, such as shares and investment funds, are also more likely to be held by wealthier households. Less wealthy households, by contrast, primarily hold balances on savings accounts and other low-risk forms of investment. However, the proportion of households that invest in funds or shares has been rising for some time now. 

Households’ debt situation

According to the report, the share of households with outstanding debt fell slightly. The decline between 2021 and 2023 is mainly attributable to fewer households having unsecured loans such as consumer credit. Around 26% of households held this type of loan in 2023, compared with 29% in 2021. This development could be a result of the coronavirus pandemic, during which less wealthy households also built up balances on savings and current accounts. Households therefore seem to make use of these balances first instead of taking out consumer credit and other unsecured loans. The higher level of interest rates is also likely to have reduced the attractiveness of additional loans. 

Overall, the results show that the structures of both wealth and debt among households in Germany are fairly stable. With the data currently available, it is not yet possible to estimate the impact of the higher interest rates on wealth and its distribution over the medium term. The next Bundesbank survey is scheduled to take place in 2026.