Net Worth by Age: What Is Average — and What Should You Aim For?

What Is Net Worth?

Net worth is the total value of everything you own (your assets) minus everything you owe (your liabilities). It is the single most complete financial snapshot you can take of yourself at any point in time.

Assets include: cash and bank account balances, savings and investment accounts, pension and retirement fund balances, the current market value of property you own, and vehicles.

Liabilities include: your outstanding mortgage balance, car loans, student loans, credit card balances, and any other personal debt.

Here is a worked example. Suppose you own a home worth $400,000 with a $250,000 mortgage remaining. You also have $50,000 in savings, a car worth $15,000 with a $10,000 loan against it, and $80,000 in a retirement account. Your net worth is: ($400,000 + $50,000 + $15,000 + $80,000) minus ($250,000 + $10,000) = $285,000.

Net worth is a snapshot in time, not a fixed destiny. Every financial decision you make — saving, spending, investing, taking on or paying off debt — changes it.

Why Median Matters More Than Average

When comparing your net worth to published benchmarks, you will encounter two numbers: the average and the median. The average is almost always misleading — and here is why.

Billionaires and ultra-high-net-worth individuals pull the average dramatically upward. A group of ten people with net worths of $100,000 each, plus one person with a net worth of $100 million, produces an average net worth of over $9 million — but nine out of ten people in that group have $100,000. The average tells you almost nothing about a typical person.

The median is the midpoint: exactly half the population has more, and half has less. In the United States, for example, the average household net worth is over $1 million, but the median is approximately $192,000 (Federal Reserve Survey of Consumer Finances, 2022). The gap is enormous — and illustrates just how concentrated wealth is at the top.

Always focus on median figures when benchmarking yourself. The median is the number that represents a genuinely typical household.

US Net Worth by Age (Federal Reserve Data, 2022)

The Federal Reserve Survey of Consumer Finances is conducted every three years and is the most comprehensive source of US household wealth data. The 2022 figures are shown below.

Notice how the gap between the median and the average grows wider with each age group. Wealth inequality compounds over time — those who started with advantages accumulate far more, which pulls the average up while the median tells a much more modest story for most households.

UK, Australia, and Canada Benchmarks

The UK Office for National Statistics Wealth and Assets Survey (2020) provides median total household wealth by age group, including pension wealth — which is the largest component for most people in later age bands.

In Australia, the ABS Survey of Income and Housing (2019-20) found that median net worth for households aged 45–54 was approximately $889,000 AUD. Property values in Sydney and Melbourne are a major driver of this figure — households in regional areas or renting typically have considerably lower net worth.

In Canada, the Statistics Canada Survey of Financial Security (2019) found that median net worth for families aged 45–54 was approximately $622,000 CAD. As in Australia, real estate is the dominant asset for most Canadian families in this age group.

Rules of Thumb for Target Net Worth

Several widely cited guidelines give you a target to aim for at different life stages.

The most common rule, from Fidelity Investments, suggests your net worth should be roughly equal to your annual income by age 35, three times your income by 45, six times by 55, and eight times by 67. These are retirement-focused targets designed to ensure you can sustain your current lifestyle in retirement.

The FIRE (Financial Independence, Retire Early) community uses a different target: 25 times your annual expenses. This is derived from the 4% withdrawal rule, which holds that you can safely withdraw 4% of a portfolio each year in retirement without depleting it over a 30-year period. If you spend $40,000 per year, you need $1,000,000 to be fully financially independent.

Both are useful as direction-of-travel targets, not rigid rules. Those who start late can still close the gap significantly through higher savings rates. Research consistently shows that the percentage of income you save matters far more than the age at which you start — though starting early remains the single biggest advantage you can give yourself.

How to Improve Your Net Worth

Net worth improves when assets grow faster than liabilities shrink — or when you eliminate liabilities entirely. Here are the highest-impact actions across both sides of the equation.

On the asset side: automate contributions to retirement accounts so you invest before you have a chance to spend; invest in low-cost index funds that compound over time; and build home equity steadily through mortgage repayments and property appreciation.

On the liability side: aggressively pay down high-interest debt (credit cards and personal loans first), and avoid taking on new debt for depreciating assets like new cars unless absolutely necessary.

The single most impactful action for the majority of people is to max out tax-sheltered accounts — 401(k) and Roth IRA in the US, ISA in the UK, superannuation in Australia, TFSA and RRSP in Canada — before placing any money in a taxable account. The tax saved on growth inside these accounts can add tens of thousands of dollars over a lifetime.

Net worth compounds. A small improvement in your 30s — paying off a car loan, starting to invest, building an emergency fund — has an enormous effect by your 60s because those actions change the trajectory of every year that follows.

Finally, do not compare your personal figures to average or median numbers in high-cost-of-living cities. A median net worth of $400,000 in San Francisco or London largely reflects property values — it does not mean those households are financially comfortable or on track for retirement.