I really do appreciate the information and the time you spent on this- even years after you completed it you can see folks are reading it. I suppose it’s pointless to dwell on the past, and I am just really thankful for all the help I’m getting from website like yours! Looking forward to retiring and starting a side hustle that allows more freetime. But, I’m a big proponent of buying real estate as young as you possibly can if you’ve found a place you want to live in or own for at least 5-10 years. This estimate assumes a lifestyle that includes: three weeks’ holiday in Europe (per year) You must have some nice cars to have $100K in equity! The beliefs of the author are being revealed here as well. The Average Net Worth For The Above Average Person, save and invest as an independent man or woman, buying real estate as young as you possibly can, Career Advice for Startup Employees: Sleep With One Eye Open, How The FIRE Movement Can Narrow The Gender Pay Gap, https://www.forbes.com/sites/laurengensler/2016/06/16/one-percent-by-state-income-inequality/#2eefadfabe3a, https://www.financialsamurai.com/scraping-by-on-500000-a-year-high-income-earners-struggling/, The Only Reasons To Ever Contribute To A Roth IRA, Real Estate Is My Favorite Asset Class To Build Wealth, https://smartasset.com/mortgage/price-to-rent-ratio-in-us-cities, https://www.ilo.org/washington/areas/gender-equality-in-the-workplace/WCMS_159496/lang–en/index.htm. 2. It’s free too. Compared to others in our area we did well but I hate the weather. That California Pension is REDICULOUS and one of the reasons I think so seriously about moving out of this nutty state. Or 23…or 24… You’re the type of person who wants to go straight to the corner office without putting in his or her dues. The question is: how long do you plan to work? That is a sick pension. It is rare for couples to make more per year than the total value of their house! Still for all that, we expect to have $3.0-$3.5M NW by age 60, based on future cash flow projections, assuming no job loss, etc… but I work in an off-shoring industry, so prospects for another decade of continued employment at current salary is very dim unless I get a lucky break or two. Cool. London, Paris, Hong Kong, etc… I think you’re somewhat parochially overestimating the abilities of even the most rockstarish ‘trailing spouse’ to find a high-performing job when the whole family has relocated to another country. 2) I’m a product of public schools, so I’m biased that it will be fine. My wife and I just turned 60 and judging by your charts we are sitting between the government average couple and the FS average couple (we did better than 5% but we don’t have the after tax savings or the home equity that you suggest). If a couple is struggling with a lot of debt and only one person is aware, the other could end up causing a lot of damage spending recklessly and not putting any money towards saving and paying off debt. Do you believe men and women are not equal in America? Good stuff ramping up your income over the past five years. I used the median priced home plus some to account for above average housing costs as well. My wife and I are in out early 30’s, married for nearly 9 years, and are off by a fair amount from these numbers. Would you consider revising this portion of your blog post? -$158k=Vanguard Brokerage Buy stock (wait, net worth again to generate any meaningful passive income) This post provides a framework of how to view […], […] The Average Net Worth For The Above Average Couple […], Your email address will not be published. around retirement time +/-7 years I would plug in 5-8% if you so choose. The global nomad stuff… hubby works for an engineering-based multinational (and since I’ve mentioned that, I’ll also point out that unless you work in tech or finance, both having rockstar careers in cities at all, let alone the same city, is unlikely). I’m 41 and have seen many female friends go through divorces that are financially devastating. To hit those figures they’d have to save $50,000 a year and realize a 7% return. We have another $270k in pre tax investments. Once college is done, then we will be able to save again. Many thanks for a great site and great blog posts. Once you’ve got a clear picture, you’ll have a better idea of how to plan and get to 6 million with the various scenario analysis tools they’ve got. He isn’t a saver himself, but I think my understanding from a young age that I would have to financially support myself and, eventually, probably my parents too, stoked my savings bug. Since CD rates are so low, I only buy muni bonds since they are tax free and helped us become FI in 2014. But u realize in 10 years I will be kicking myself that I did. Our after tax savings are a bit behind as well but our home equity is larger (about $500K) due to buying in 2011 from financially distressed owners in a very desirable neighborhood. And you sound like a jerk or worse. Interesting that you point out the wife’s value is only 12.5% under the Government tax system. I am 47 and my wife is 33. It get’s better as you get older, but your “above average person” is never at less than the 95% percentile. Net worth is $ 3.8m. I didn’t really get focused until about 30yo after a divorce on saving more aggressively and living frugally. I’m not sure which century or country you are living in, but males and females are equal here in America at least.”. Therefore, a blanket federal income tax rate not based on zip code is hard for many. This is what I did… My husband is only 2 years younger than me chronologically, but I graduated HS a year early and then was on the 3 year plan at College, while he was on the 5 year plan. As you know these can make a difference. How about instead, REWARD the stay at home parent? Thanks the charts. So private school for the next 5 years appears to be on the cards. I always welcome new readers who bring about new perspectives. Focus on the AFTER-TAX investment accounts so you can earn usable passive income. I assume you have the house paid off but that’s not a lot in my book. We bought our house in 2007 when the prices were declining. And I’m certainly doing my best to indoctrinate my kids and set them on the right path. I think there will be strength for another 3 years minimum due to Uber, Airbnb and Box going public, not to mention Apple entering a new product cycle and also at near all-time highs. We would be Above Average if we hadn’t FIREd in 2012. That being said, this is not a “sour-grapes” comment … I’m near the 50 year mark and am tracking about 1.6x your “couples Financial Samurai” version above. One spouse stays at home b/c that is what the government wants. We have a 1500 sq ft house with a 5 year old dog. I found your post through a random Google search for something like “average net worth for 30 year old.” And it was exactly on point! It’s fun to shoot for goals, otherwise things get kind of dull. The cost of living is very different for those living in New York City versus Birmingham, Alabama. Should we be mixing pre-tax and Roth 401K contributions or all pre-tax for our 401K? Definitely rinse and repeat with property if you can hold on. Think PRINCIPAL PROTECTION at age 50+. Incomes are all over the place, but I think you’ll like this post: How Much Should My Net Worth Or Savings Be By Income. Educate yourself a little on the subject and actually read up on it with an open mind. What do you think of our current financial situation? I think I see Sam’s point after wikipedia-ing the subject. Crazy system. The Way To Talk To Your Guy About Starting A Family, Bored In A Relationship? We have been contributing to 529 plans for over 14 years now. excuse me but what do you do exaclty? Teamwork is so key. The Financial Samurai Net Worth method provides a recognition there are financial synergies for being a couple. We’re taking our first step into the rental market soon. It’s unfortunate when people seem to view life primarily through the lense of “economics” when there are other ways to assign value as well as to interpret the motives of others. Sam, But a private pension worth more than £85 per week may affect how much you can get. I feel incredibly fortunate to know we have these options. That’s how I did as just a regular working class stiff. Compare to your FS method chart, we are quite a bit behind in the pre tax category and ahead in the property. See: The Case For Bonds, The Allure Of Zero Coupon Bonds, and Recommended Net Worth Allocation By Age. The increase in value from that point of time is pre-tax but the principal is post tax. If so, it comes down to value. “If you love the government, are very traditional, and believe one spouse should probably stay at home then you are a proponent of the Government Taxation Net Worth method. I’d look into a mixture of CDs and your state’s municipal bonds w/ part of that 50, while saving like crazy for the next 3 years. Of course, no money saved for the kid’s college, so have been aggressively saving for the past 4 years to assist with that. Let me know which method you agree with: Equality, Big Government, or Financial Samurai method for calculating a couple’s net worth. With Personal Capital, you can track your cash flow, x-ray your investments for excessive fees, and make sure your retirement plans are on track. I went to graduate school so didn’t start working until 25, so we are little behind on pre-tax savings with just $500K, but have $325K in post-tax savings and $95K of equity in our home that we purchased 10 years ago. You can adjust the figures down if you live in a much lower cost area of the country. Just the fact that you are reading this article means you are serious about supercharging your finances for a better life. I hope Sam deletes and blocks you. $100,000-$250,000 is NOT enough, which means the country is going to have a huge financial burden as we take care of more people who cannot fully take care of themselves. Financially a lower mortgage cost is better if the savings over a potentially more expensive mortgage is not completely negated by private school tuition and fees. Easy: The government is greedy. Great attitude Willie! However, I would use them as benchmarks/goals as you get older. I am 64, wife (was a stay at home mom) is 65. The last thing that you want is for your best friend, brother, or mom to see you and your boyfriend yelling at each other over who was supposed to do the laundry or clean your apartment yesterday (or whatever you two are fighting about). With a traditional IRA, qualified purposes for fund withdrawal include a qualified home purchase, qualified higher education expenses, qualified major medical expenses and certain long-term unemployment expenses. If you have 1.35 million in cash then I would do the allocation: When I was doing my MBA at a top 10 university, my statistics professor (who was female) completed a thorough analysis to determine whether an income gap exists. Do the best you can to hit whatever milestone(s) you can reach without killing yourselves. Should we more or less just inflate the single person a bit to account for some economies of scale? A couple questions about pre-tax vs post tax: Either way, it is an extremely rare couple that doesn’t have to make compromises for one another’s careers. If you say 15+ years, then you’re doing great. My wife was a stay at home mom and I had a good career at a megacorp retiring at VP level. I feel more confident building my [investment] wealth through accounts with [future] taxes only on the gains, not the principle contributed. Over time stocks tend to appreciate more than homes as well. Reading this article prompted me to go back through the records and review the history of our net worth, at 30 ~ (15,000), at 40 ~150k, at 50 ~ 1.3M, 55 ~ 2.5M, date of retirement at 59 ~3.6M, now at 61 ~4.1M. 1) Above average people often have bank of mom and dad pay or get grants, 2) You are free to go by years of work experience instead of age. Sorry I’m late to the party on this one, Sam. I graduated from school at 23 with no debt and being fairly financially disciplined. For those of you who combined your household net worth to see where you stand, so sorry. I will definitely check out Personal Capital – it looks like it has some features that aren’t offered by my current programs of choice: YNAB4 (which I like a whole lot for budgeting), Mint.com (which I’m not a huge fan of but it serves a purpose), and the Morningstar Portfolio Manager (which is good but tedious to enter in data manually)… and of course my Excel spreadsheets, which you’ll have to pry from my cold, dead fingers. I’ve done a pretty deep analysis and I really think these figures are realistic for those who maximize their pretax retirement accounts and save even more over time. It could be a woman who is earning the $400K income and there is a stay at home dad or spouse. Monetarily, it comes down to doing your best and living on a useful budget, which includes sufficient retirement savings. I think you’ll be fine, especially if you work 10 more years and get that pension! I’m not sure that I buy your numbers, if your definition of “above average couple” is the top 16%. I’ve stopped caring about my net worth, and I only care about building passive income. 2) For more stable investment returns and potential outperformance of volatile stocks, take a look at Fundrise, a top real estate crowdfunding platform for non-accredited investors. Sam, And congrats for buying property when people were selling. This rule was reversed on 15 May 2019 as it used to be the age of the older member of a couple that determined whether they qualify. I will hit 500k net worth, possibly more, by my 30th birthday (I am currently 29, spouse 28) We have been in the work force for 7 years steadily increasing our income from a combined 60k to 160k while not increasing our lifestyle by much. My financial net worth then was $2,830,300. But for goodness sake, let the American people decide whether one spouse should stay at home or not. It was often not easy, and it has been a while since we have been working for ourselves. Putting 225K into a CD to pay off your mortage in 5 years is a sure bet! But you should conservatively value your stock options and grants, especially if the company is not public. Here in Hawaii prices were similar to the Bay Area, it softened but didn’t drop much. Take me and my wife for example…..Wife and I are at about 25% of where we should be based on your chart at the age of 45ish. Got it. By definition, “above average” is not most people. I think you are giving our legislators too much credit! The expense point you point out is important. No, I didn’t have a head start, I grew up on food stamps. Did you not think through those alternative reasons before writing this? Most people over 35 all nod their heads in agreement. Our house is nice, but about half a years salary. As a post script – I wouldn’t trade ANY of my life experiences so far for that “Above Average” personal wealth goal. In our case, I retired at age 55. Point is, I think the chart is optimistic, in that it it doesn’t seem to factor ANY headwinds in…. It’s free and my favorite financial tool. Right now, I would suggest real estate investment as your intermediate and long term goals, but try to obtain max returns on your stocks and keep interest expense down on any debt as much as possible as you enter this phase of your life. And the breakdown on your chart is remarkably similar to our own portfolio. I would definitely agree that the choice is very apparent. Just a thought but why would you want a 4 million dollar net worth at age 65, wouldn’t it better to stop working at say age 40 and enjoy an extra 25 years of freedom from work? i’ve read all your stuff here ^_^ I just wanted to see if there was some way besides having big money to generate passive income… turns out it’s all about writing books. So given my unique circumstances, it just made sense to feed the Roth pig while starving the other. WCI = white coat investor = Doctor readership = big income ($400k+ with specialities going upwards of $750k). For example, go to SF, NYC, Chicago, LA, London, Paris, Hong Kong and if you are at the top of your game, you will get plenty of offers. How much state pension will I get if I qualified on or after 6 April 2016? Then I would probably agree with the net worth values in early adulthood, but those would be well above average assumptions to make. To then add another $385,000 by age 30 to total $550,000 seems extremely high too. But I have to do in this for a long while now, what I realized is that younger people simply are not as disciplined and focused about money as older people. I don’t think it’s unrealistic. The fact that this topic is popular on here may serve you well if this was expanded a bit more (which you just did with the couples angle, but perhaps looking at other data sources to help quantify what people’s net worth is…and perhaps with respect to geography/cost of living…also how to maximize your relative net worth by moving to a low cost area — which I plan to do (abroad)!. Does that put a couple in a worse position? I love these charts but I think one of your main assumptions in putting together a joint net worth target is a bit off. For instance, we’d be saving $20K+ a year if we didn’t have to pay for childcare (and that’s cheap!). These income numbers represent one percenters in 2013 approximately $390K household. Our IRA’s will kick in in the next 9 years, followed by a “raise” from Social Security when the time is right. So I made it my goal to replace her income through raises and side-gigs. It looks like the problem isn’t your income, it’s your spending, it’s extremely high for somebody in retirement. Which tells me that I need to invest more! So having a smaller mortgage afford us to do what we want. Now our mortgage is less than most apartment rentals. One simply has to double the amounts in my above average person net worth chart to get to the Equality Net Worth chart. Thank you Financial Samurai :). Average salaries/ a good work ethic/ common sense approach to budget + savings and time will get you to a good place. Then run your investment portfolios through the 401k and portfolio fee analyzer, and see how your current allocation sits with your comfortability/risk tolerance. Another issue is that you two have different expectations. 4-5years “younger” than mine. In 2011 i bought a home for 201,000. Couple income requirements. If you can’t talk without fighting, there’s definitely something wrong with your relationship, and it’s time to look at that. Good progress! Congrats on winning the game on your terms! Her analysis accounted for jobs and years of experience. This takes no additional considerations into accout such as appreciation, taxes, etc. And by a lot, I mean we have a negative net worth ATM. Our combined net worth is $1.1 million, I’m happy to have passed the $1mm psychological point! Annual Income $110 K (combined) So should I delay just to fulfill SS? Pension (because that’s dependable these days!). I am a self taught electrical engineer that maintains, repairs, and installs Uninterruptable Power Supplies and other ancillary critical power equipment. To do it, follow the advice here. However, by definition, above average in my book is anything more than 1 standard deviation above the normal distribution curve eg couples who perform better than 84% of other couples. My wife (31) and I (38) are on track but our mix of assets is skewed. The authors personal experience may not be the norm, nor is mine, but an educated buyer can do quite well in real estate. You pay a dollar in interest, then get a 30 cent deduction? Do you think it would still be a good idea to buy a property in SF at these prices or to invest in a REIT or eREIT instead? Luckily our overall net worth is strong due to incredible housing appreciation in my market (Denver). For example, a couple who estimate their annual retirement income needs to be $70,000 will need to save: Sadly cause of this she basically doesnt have much saved from her side of net worth. For the rest of us, our shelf lives are much shorter. In our 20s we were single and below your chart. Thanks for sharing your numbers and putting your kids through college! Bs sniper- while i dont agree or disagree with you and simply seeing other folks opinions, i do want to point out some personal observations. We do understand that staying employed, even if the desire’s there, may not always be our choice. the reason that women are not “equal” comes from them not working as many hours and doing jobs that pay less because they can not or will not do ones that pay more. With one child, we were able to consistently save 30% of our income. what would you consider an above average income at age 30? Things really start adding up! You make a good point about one spouse sacrificing his/her career for the other. Always good to have goals. To answer your second question. I would argue the The Average Net Worth For The Above Average Person would apply for married couples if one person is out of the workforce to be a stay at home parent. I can definitely agree that the big stumbling block is that young people simply don’t care to invest and save, they want to be rewarded immediately, not in X number of years. Is that enough to live? The article is 65% geared towards folks who are younger who still have time to save. But you’re original article appears to say that if you (not the government; “you” is what you wrote) choose to have one spouse stay at home then somehow that makes you a “proponent” of the government’s approach to taxation and “you believe” women are worth less. It does seem rare for both spouses to get their ideal job in a move doesn’t it? Thankfully we’re picking up the pace now! The problem is we have rental properties that are many years away from being paid off, which doesn’t create a lot of passive income. Your property tax figures assume a house price of $1.5-3 million, plus the portfolio of $2-3 million giving you a net worth of $3.5-6 million. I started to move all my salary earnings last year to Mutual Funds that pays out Dividends, should I start moving a % of my CDs over as well knowing that retirement is within 3-5 years? Since traditional IRAs are tax-deferred, then the distributions are taxed as regular “earned income” at the appropriate levels. I maintain data centers for customers in industries such as finance, healthcare, co-location, and social networking. The higher the figures, the more the pushback. It is one of the education systems biggest failures for preparing our youth for the realities of life. Unlike most on here we are almost done paying off student loans etc. Money is only a means to an end. Notice how an individual pays a 37% marginal federal income tax bracket after $510,300, but a married couple starts paying a 37% marginal federal income tax above $612,350. Yet the structural debt from the two wars, two tax cuts, and medicare part D all charged on credit remain to get paid in the future. People who make higher salaries tend to live in higher cost of living areas. 2) The work start date and assumed income are much too soon and much too high even for top 16%. Does he say that you’re always upset with him and that he doesn’t feel loved or appreciated? Our incomes rose as we had the second child and I’d say we’re able to save the same dollar amount as before, but that equates to about 25% of our combined income now. Not only are above average married couples wealthier, they are likely healthier as well. For example, what % of couples have a net worth of $162,000 at age 25? Each person wants the best for the other and knows that relationships go through tough times as well as happier ones and that it’s in everyone’s best interest, to be honest. The problem we have while comparing your chart is ,just between the 529s/401k vs taxable accounts, most of our money is in pre tax accounts(about 81%) and we are way lagging behind in taxable accounts. I assumed $500,000 as the base home price which is actually way higher than the national median home price, but I am exaggerating my numbers and they still do not add up to justify your bogus claims. (that was a mistake buying this home ) We do live an expensive area and can always move where it is cheaper. High income does not equate to high net worth. Obviously only 4% of US households reach this level of wealth so I would categorize this as elite. I came from a single income family with a disabled non-working parent and that definitely was never an option for my dad. If you can relate to any of these, then it’s totally possible that your love story needs some work and that you two need to figure out if you’re even meant to be together. Then we would kick in $50k from our savings so that is why I come up that we need 1.5 mill in investments (not home) to retire.