Average Net Worth Goals by Age: A Millennial's Guide

Shari Rash
December 7, 2023
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Net worth is not a term reserved for celebrities. Every person has a net worth and it is important to understand yours because Net Worth is a more accurate depiction of one’s financial stability than just income alone. If you are trying to improve your financial situation, or create a plan to achieve your future goals, identifying ways to increase your net worth is the best place to start. 

In your twenties and thirties, the term 'net worth' might not cross your mind as often as it should. It may feel like you’re just trying to get through every day, spend less than you earn, hopefully reduce some of your debt and hopefully buy a house. Ways to increase your Net Worth are not at the forefront of your thoughts. 

As a fiduciary financial advisor, I want to emphasize that understanding your net worth and setting relevant goals based on your age is the key to financial freedom. This article aims to inform millennials on how to have a plan for their money and build your net worth systematically.

What is Net Worth?

Your net worth is an effective measurement of your financial health. It is a snapshot of your financial health at a specific point in time. Your Net Worth can differ from day to day, depending on the value of your assets and your liabilities. 

The formal explanation of net worth is Assets less liabilities. To break it down very simply, net worth is what you own minus what you owe

To determine your net worth: write down a list of everything you own (Assets): bank accounts, retirement accounts (401k, 403b, IRA, Roth IRA), after tax investment accounts, your home.

Then write down a list of all of your debts (liabilities): credit cards, student loans, mortgage. 

Subtract the liabilities from the Assets. That is your Net Worth.

For example, if you sold everything you owned and paid back everything you owed, you’d be left with $500. That means your Net Worth is $500. This is an example of positive net worth. A negative net worth results in owing more than you can pay, indicating that financial change is needed.

If you have a home that is worth $450,000, but you owe $200,000, your home’s Net Worth is $250,000 (Own: $450k minus Owe: $200k = Net Worth: $250k)

How to Calculate Your Net Worth

The net worth calculation includes everything you have with a dollar sign. Your net worth assets might include:

  • Amounts in checking, savings, and money market accounts
  • Value of outside investment accounts
  • Value of retirement accounts, like 401(k)s and IRAs
  • Value of tangible personal property, like cars and houses

You must also calculate your liabilities, which might include:

  • Current balance on credit cards
  • Current balance on installment loans, like a mortgage or car loan
  • Current balance of any other loans, such as personal loans or lines of credit

What are Common Mistakes That Can Affect Your Net Worth

The biggest mistake that can affect your net worth is not thinking about it. People often focus on their assets (what they own) and they neglect to think about their liabilities (debt). You can have a large amount of money in assets, but if you keep on bringing on debt, those assets do not add to your net worth dollar for dollar. 

Some aspects of a net worth calculation can be subjective because you need to assign a fair market value to a portion of your assets. Fair market value is the price you could get for something today if you were to sell. For example, you shouldn’t include your vehicle as worth $15,000 when you would only get $5,000 if you were to take it to the dealership today.

The net worth calculation can be a powerful financial planning tool, but only if you consistently review your progress. A common mistake that countless individuals make is neglecting to track progress regularly. How can you expect to improve your financial position if you don’t take the time to understand where you are now and compare it to where you were. 

A best practice would be to quarterly track your net worth. It doesn’t have to be fancy, just have an excel spreadsheet with your assets and liabilities, update the values and subtract. You can keep a running list of your Net Worths by quarter and see how the value fluctuates, 

Where Should Your Net Worth Fall Based on Age?

There are two ways to increase your net worth: increase your assets or decrease your liabilities. One of the driving forces behind portfolio value is compound interest. Under this principle, your investments will accumulate more earnings over time. This means that your net worth should increase with age. Here are the average net worth figures by age.

Individuals under 35 are most likely getting their bearings. You might be fresh out of college or establishing your career and a family. Purchasing a house, a new car, and traveling might also be on your to-do list.

As a result, your net worth won’t be very high, with the average American net worth falling around $76,300. Keep in mind that the sooner your net worth is positive, the quicker you will have a strong foundation to build wealth for years to come.

Net Worth in Your 20s

By the time you reach your late 20s, you’re likely to have landed your first professional job, started paying toward your debts, especially if you took student loans. A practical net worth goal by the age of 30 would be having your annual salary saved between a savings account and investment account. 

In your 20s and 30s is when most people buy their first home. So, there will be a sharp rise in assets due to the value of the home, but also a big liability of the mortgage. 

The next 10 years is when you will begin to see the power of compound interest, watching the investments you made in your 20s grow. This number should include a mix of items, such as retirement funds and tangible property, like a home.

Net Worth in Your 30s (Average Millennial’s Net Worth)

When you journey through your 30s and as a millennial in its prime, you should work to eliminate your non-mortgage debt – like credit card balances, student loans, or car loans. By age 35, aim to have at least twice your annual income saved in retirement and non-retirement accounts. As you approach 40, strive to have three times your annual income.

Net Worth in Your 40s

In your 40s, you should be focusing on your future: retirement. By the time you're 45, strive for a net worth equal to four times your annual salary. According to recent studies, $436,200 is the average net worth for a 45-year-old. By 50, this target should increase to six times your annual income.

Your late 40s and early 50s are when retirement becomes an important conversation. Do you have enough funds to retire? What age should you retire? Oftentimes, retirement requires careful planning in your 20s to leverage the power of compound interest. Nevertheless, by age 54, your net worth should be around $833,200.

Net Worth in Your 55-64

Nothing unexpected should be happening between ages 55 and 64. You are most likely taking on less risky investments, securing your nest egg for retirement. You may also have big bills during this period of time: college tuition, wedding, home improvements. As a result, your growth potential may slow down. Studies show that the average net worth for this age range is around $1,175,900.

Net Worth in Your 65-74

The same is true for ages 65 to 74. Retirement has most likely started and you are living on the funds you accumulated over the past 30 years. Your net worth might reach an all-time high as the market continues to work in the background, creating an average net worth of $1,217,700.

Net Worth in Your 70+

As you continue to draw on your retirement funds, your net worth will begin to decrease. Hopefully, you’ve saved up enough funds to last the entirety of your retirement without needing to pinch pennies each month. The average net worth for individuals 70+ is $977,600.

How do you compare to the average net worth figure by age? Are you ahead of the game or are you trailing behind? If you find that you are exceeding the average benchmark, great! However, if you’re like most individuals and families, you’ve never considered your net worth and might not be meeting the standards.

These goals may seem daunting, but keep in mind that they are not set in stone. Everyone's financial journey is different, and these are guidelines, not hard and fast rules.

The good news about net worth is that there are actions you can take today to improve your situation for years to come. 


This is why it’s important to partner with an expert that can uncover attainable solutions to grow your net worth. By making small changes, you can set yourself up for financial success. Our team at Greenway Wealth Advisory can do just that.

We take a personalized approach to net worth planning, creating goals and strategies specific to your situation. We don’t believe in a one-size-fits-all approach. To learn more about how our team can help you, schedule a consultation today.


Sources: https://www.nerdwallet.com/article/finance/average-net-worth-by-age

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