The disparities in wealth between Finland’s richest and poorest households is growing ever wider, according to a report by Statistics Finland.
The data agency revealed that the median household’s net wealth was 104,000 in 2019, but 25 percent of households had a net wealth of over 257,900 euro while another quarter of households had under 9,400 euros.
Net wealth refers to a household’s net economic position, or the value of the household’s assets minus liabilities. Household assets include such items as bank accounts, retirement funds, investments, property or vehicles.
The wealthiest were households of people aged 65–74, with an average net worth of approximately 214,800, or more than double the median. The report added that wealth is concentrated in the richest top ten percent, which owned nearly half of all net worth in 2019.
The richest 10 percent of Finns have seen their share of net wealth gradually but steadily rise from 36.6 percent in 1988 to 43.9 percent in 2009 to 49.6 percent in 2019, according to Statistics Finland’s figures.
At the other end of the scale, 50 percent of Finnish households own about 5.4 percent of net wealth. This has dropped from 10.2 percent in 1988.
Property the main source of wealth
The data found that the most commonly owned asset type was bank deposits, which 98 percent of households possessed. The next most commonly owned assets were a car or other means of transport (72 percent of households), homes (65 percent) and listed shares and fund investments (43 percent).
Owner-occupied homes were the most significant asset in terms of value, accounting for almost half of total holdings. The second most significant was other dwellings, such as a holiday home, which accounted for more than 10 per cent of total assets.
The increase in wealth disparities is partly due to the differences in the value of housing across Finland, as housing prices in the Helsinki metropolitan area in particular have increased more than elsewhere in the country. The rise in stock prices has also helped to further enrich the wealthiest households.
The data also showed that three out of five households were in debt, about 16 percent of which owed more than three times their total income in 2019. One in four indebted households owed amounts which exceeded 75 percent of the value of their assets.