How Much Should Your Average Net Worth at Every Stage of Life?

The difference between your assets and liabilities, or your net worth, can be a useful indicator of your financial health. As you acquire wealth and pay debt, your money should ideally increase over time.

What, therefore, should to be your net worth at this point of your life? Comparing your net worth to the national average for various age groups can be helpful even though there isn’t one right answer.

What is net worth ?

Everything you own (your assets) minus what you owe (your liabilities) is your net worth. This important financial metric helps you monitor your net worth over time.

Add up all of your assets, such as cash, investments, bank accounts, retirement accounts, home equity, and other valuables, to determine your wealth. Next, sum up all of your debts, including credit card debt, other loans, student loans, auto loans, and mortgages. Lastly, subtract all of your liabilities from all of your assets.

Average age-specific net worth

Net worth typically grows as people advance in their careers, accumulate savings, and pay down debts. According to the Federal Reserve’s Survey of Consumer Finances, the average American family’s wealth in 2022 was $1,059,470, while the median net worth was $192,700—a more accurate reflection of financial standing since extreme wealth can distort average figures.

Net worth tends to vary significantly by age, with younger individuals often carrying more debt due to student loans and mortgages, while older individuals typically accumulate more wealth through homeownership, retirement savings, and investments.

By understanding how net worth fluctuates at different life stages, you can set realistic financial goals and create a plan to improve your long-term financial well-being.

Average & Median Net Worth by Age

Age (Decade)	Average	Median
20s	$113,084	$7,638
30s	$317,171	$35,649
40s	$791,616	$125,370
50s	$1,406,887	$288,263
60s	$1,703,727	$439,154
70s	$1,626,996	$367,286
80s	$1,521,375	$342,552
90s	$1,292,056	$293,322

What is the Growth of Net Worth?

You may have a positive or negative net worth. In actuality, having a negative net worth is not uncommon, particularly for young people. But ideally, as you acquire more assets, raise your income, and settle debt, your wealth rises over time.

For example, you might begin your work with a large student loan balance and an entry-level salary. However, you could be able to make quick progress in investing, saving money, and paying off your loans if you have lower costs in your early years.

As life progresses, significant milestones like starting a family or purchasing a home often bring substantial financial responsibilities. Expenses such as childcare, education, home renovations, and property taxes can put a strain on your finances, potentially reducing your savings rate or even leading to temporary debt.

However, as you advance in your career and financial journey, you may find opportunities to accelerate wealth-building. Paying off a mortgage, reducing household expenses, receiving a salary increase, or becoming debt-free can all contribute to growing your wealth.

Eventually, as you transition into retirement and begin withdrawing from your savings, your net worth may gradually decline. Data from financial services company Empower indicates that net worth generally rises until your 60s, after which it tends to decrease.

Strategies to Increase Your Net Worth

If your net worth isn’t where you’d like it to be, don’t be discouraged. Avoid comparing yourself too closely to averages or medians, as everyone’s financial situation, priorities, and opportunities are unique.

The good news is that there are many ways to build and protect your wealth over time. Here are some key strategies to help you grow your net worth:

Build an Emergency Fund: Having a solid financial safety wealth can prevent you from relying on debt when unexpected expenses arise. Aim to save at least six months’ worth of essential expenses and reserve this fund strictly for genuine emergencies.

Reduce Debt: Reducing debt increases your money and frees up funds for investments and savings. To prevent accruing excessive interest charges, give priority to high-interest debts, such as credit cards.

Reduce Unnecessary expenses: Reducing unnecessary spending will help you reach your financial goals. Check your most recent credit card and bank statements to identify areas where you might make savings without sacrificing your standard of life.

Boost Your Earnings: Your earning potential is often limitless, but there is a limit to how much you can reduce expenses. To speed up your wealth growth, think about negotiating a raise, looking into side income options, or even moving to a higher-paying growth.

Invest for Long-Term Growth: Over time, wise investments can raise your wealth considerably. To optimize tax benefits, use tax-advantaged accounts such as 401(k)s or IRAs. If employer-matching contributions are offered, take advantage of them.

Protect Your Wealth: Preserving your wealth is equally important as increasing it. Make sure your important things, loved ones, and yourself are adequately covered by insurance. Creating a will and naming beneficiaries are two examples of estate planning that may help secure your financial legacy.