Net worth is a measure of your wealth. It’s the value of your assets minus liabilities, revealing how much you own after subtracting any debt you currently owe. If you have a high net worth, you’re likely on the right track to financial security.
Unsurprisingly, net worth tends to increase along with income since those who earn more have more money to buy assets that hold or increase their value over time, such as stocks in a brokerage account. Because the amount of money you make impacts the wealth you can build, it’s helpful to see how your net worth compares to that of your fellow Americans. Here’s what you need to know.
The average American’s net worth by income
To see how your net worth compares to others with a similar income, check out the table below, which shows net worth by income bracket.
| Income | Median net worth | Mean net worth |
|---|---|---|
| Under $34,600 | $14,000 | $129,700 |
| $34,600–$59,499 | $71,000 | $218,700 |
| $59,500–$91,899 | $159,300 | $385,400 |
| $91,900–$153,099 | $307,200 | $636,800 |
| $153,100–$245,399 | $747,000 | $1,264,700 |
| $245,400 and above | $2,556,200 | $6,629,600 |
Data source: federalreserve.gov
As you can see, a significant gap exists between the median net worth and mean net worth. This makes sense, as some people manage to amass a lot of wealth, skewing the overall average much higher.
Still, you can get a pretty good idea of the typical person’s net worth in your income bracket by looking at the median numbers. Using this data, you can see if other people who make around what you do have managed to grow their wealth more than you by acquiring more assets and paying down debt.
What if your net worth is below that of your peers?
Income has a big impact on net worth, as you can see with the steadily increasing wealth held by those who earn higher salaries. However, it’s not the only contributing factor that determines how much wealth you can accumulate.
If your net worth is below that of your peers earning a similar income, there may be a good reason for that. You may, for example, have acquired a lot of debt while gaining the qualifications necessary to do your job. Or you might have credit card debt from helping out family members or coping with a medical emergency. You may even have just started earning a high income, so you haven’t had time to grow your wealth yet.
Still, you should try to grow your net worth as much as possible, especially if you’re earning a lot of money and have the opportunity to do so. Build a budget that prioritizes eliminating high-interest consumer debt and devoting as much money as you can to buying things like stocks that stand a good chance of growing in value over time.
If you’re below your peers on the net worth ladder, don’t worry too much about it, especially if there’s a clear justification for why your wealth is lagging. But use that fact as an opportunity to inspire you to make positive changes.
If your net worth is above that of those with a similar income level, on the other hand, that means you’re using your money wisely and should stay the course to continue building a secure future.
Alert: our top-rated cash back card now has 0% intro APR until 2025
This credit card is not just good – it’s so exceptional that our experts use it personally. It features a lengthy 0% intro APR period, a cash back rate of up to 5%, and all somehow for no annual fee! Click here to read our full review for free and apply in just 2 minutes.
