The New Wealth Scoreboard

[ziggy29]

Is this the first time net worth is profiled with age?

I am not sure people in 40 today can grow their wealth to that level of 60 after 20 years.

The early baby boomers have better economic environment for them to grow wealth.

It's hard to say. A lot of depends on the economy and market cycles, and that depends on, well, the "birth lottery" and being born at the right time.

If you're born in (say) 1940, you hit your peak earning and saving years during a long, explosive bull market -- and by 2000 at age 60, if you lived below your means and invested appropriately, you probably saw a massive spike in net worth from 40 to 60. If you started to become significantly more conservative by the time you were 60, you took a fair bit of those gains "off the table" before the Ursa Major descended on us.

People born in 1960, on the other hand, started a horrible run for investing when they hit 40. Yes, it's still possible they can enjoy a bull run at some point in the future, but demographics and economic drags don't make that feel very likely. Their only saving grace might be that they still have to invest aggressively at an older age because their current retirement nest egg just hasn't grown as much as it needs to.

It's made even worse by reading the tea leaves and realizing that the 1960 person isn't as likely to get as good a retirement deal from employers or the government as the 1940 person anyway.

I guess I was lucky (or prescient) despite the relatively bad timing of my birth. I was aggressively saving into my 401K since the late 1980s, putting 10% or more of my income into the market while it still had a decade to shoot up. I didn't trust business *or* the government to honor the deals they had made with me regarding the pension or Social Security (as we know it today). That is the *only* reason I have a good chance to retire well before 60 today. If I didn't do that -- if I assumed SS and Medicare as we knew it would be strong and solvent for me, not watered down, if I assumed my first Megacorp employer would never freeze my pension before I really had a chance to grow it much, if I used this as a rationalization that I'd have a comfortable retirement at 55 without needing to grow my own personal retirement savings -- I might not ever be able to retire.

 

[engprodigy]

I figured I was doing well compared to my peers but didn't realize I was 1%'er... I have a feeling in a few years I'll be demoted to 5% though

I've always been curious about networth based on age since at my age looking at national averages is pretty much pointless...

As far as why we "compare", I figure it is a biological thing, competition is what drives life throughout the animal kingdom, we just apply it in more ways than passing on genes and eating

 

[NW-Bound]

If you get to the 1% based on just your income and no inheritance, it is impressive no matter at what age. I just looked and the 1% median for the age group of 20-29 is $425K. I did not get to that net worth level until I was in my mid 30s.

 

[Amethyst]

I think the richer folks get even richer in their late 50's and 60's, due to inheritances. One of my work peers has lived above her means throughout her career - maids, vacations, constant eating out, you name it - because she can count on several million dollars in inheritance. Sometimes she bemoans not having much in the bank, and I just keep my mouth shut and make sympathetic noises.

As for us, we don't care where we fall on a scoreboard. The only scoreboard that matters is where we can afford to live. We have the LBYM lifestyle. We'd prefer to live in a location and home that is technically "higher" than our means.

Amethyst

 

[Huston55]

I figured I was doing well compared to my peers but didn't realize I was 1%'er... I have a feeling in a few years I'll be demoted to 5% though

I've always been curious about networth based on age since at my age looking at national averages is pretty much pointless...

As far as why we "compare", I figure it is a biological thing, competition is what drives life throughout the animal kingdom, we just apply it in more ways than passing on genes and eating

If you get to the 1% based on just your income and no inheritance, it is impressive no matter at what age. I just looked and the 1% median for the age group of 20-29 is $425K. I did not get to that net worth level until I was in my mid 30s.

Being a 1%er at 29 is a distinct advantage and something to build from. You're well on your way to FI. The slow, steady road is the sure one.

When I was 29, I had a DW in school and was still in the military, as well as being in the bottom right cell of this table. I've worked my way up and to the left as I've aged but, could probably have saved more when I was younger.

Use your early lead to your advantage, and stay in the top 5%.

Remember, a 100% probability of a 5% return is MUCH better than a 50% chance of 10% return; Vegas was built on us not knowing that.

 

[engprodigy]

If you get to the 1% based on just your income and no inheritance, it is impressive no matter at what age. I just looked and the 1% median for the age group of 20-29 is $425K. I did not get to that net worth level until I was in my mid 30s.

Being a 1%er at 29 is a distinct advantage and something to build from. You're well on your way to FI. The slow, steady road is the sure one.

I was taught to save, invest and live beneath my means growing up and it stuck I suppose. I'm not as frugal as my folks, but I'm still pretty cheap

I was given a fairly nice college graduation present from my parents since they didn't have to pay tuition etc and it went toward a car. Since then my networth is all from my income.

Use your early lead to your advantage, and stay in the top 5%.

That is my plan, I have no illusions of remaining a 1%'er, but 5% sounds pretty nice

 

[heyyou]

All of the above is the answer to the asset boom for pre-retirees. For most here, the markets went up on cue with peak savings (no mortgage, kids grown) and the savers already had many multiples of their retirement spending. It is luck, but the luck of having saved five or ten multiples of your retirement spending at the start of a boom.

For me, it was much easier to get from ten multiples to twenty, than it was to get from none to one or two multiples saved while carrying a new mortgage. Yes, it took much longer to double ten, but the routine was set, and the goal was seen as being achievable with adequate patience.

 

[NW-Bound]

Hey, wait a minute. The Fed survey used in the article was dated 2010. From when I was 35 to 2010, that's almost 20 years. I just looked up the inflation in that time span, and it was 60%. That's huge.

Now, the $424K threshold in 2010 would be worth only $424/1.60 = $265K when I was 35. Heck, I did a lot better than I first thought.

How's that for a competitive spirit?

 

[ShokWaveRider]

Nowhere near the top 1% for our age.... $10m would be nice....

Wonder where the top 5% fall? I would say we fll in there some place.

 

[photoguy]

The threshold to make it into the top 5% should be the number in the 10% column. I.e., the median of the top 10% is equal to the 5th percentile.

 

[Beryl]

Do you look at "your assets", as in the case of a married (or partnership) couple, and divide by 2?

I was thinking that the charts were for individuals but your are probably right in that the chart probably represents household figures and we don't know the assumed population in the home. It probably varies by age.

(I don't know where I fall and it doesn't matter. )