How to Calculate Your Net Worth (And Why It Matters More Than Income)
Your net worth is the single best measure of financial health. Learn how to calculate it, compare yourself to 2026 benchmarks by age, and use it to track progress.
Income is what you earn. Net worth is what you keep. A surgeon earning $400,000 who spends $410,000 per year has a negative net worth. A teacher earning $60,000 who saves $15,000 per year has a growing net worth. The teacher is wealthier.
Net worth is the single most honest number in personal finance. It cuts through salary flexing and lifestyle inflation to reveal where you actually stand. And unlike income, it compounds. Every dollar you save and invest adds to it, and those dollars generate returns that add more.
What Is Net Worth?
Net worth is your total assets minus your total liabilities. The formula is simple:
Net Worth = Total Assets - Total Liabilities
Assets include everything you own that has monetary value:
- Cash, checking, and savings accounts
- Investment accounts (401(k), IRA, brokerage, Roth IRA)
- Real estate (market value of your home)
- Vehicles (current market value, not what you paid)
- Business equity
- Valuable possessions (jewelry, art, collectibles)
Liabilities include everything you owe:
- Mortgage balance
- Auto loan balance
- Student loan balance
- Credit card balances
- Personal loans
- Medical debt
- Tax liabilities
- Any other debt
Use our Net Worth Calculator to calculate yours in about five minutes. It adds up your assets and liabilities and gives you the number instantly.
2026 Net Worth Benchmarks by Age
The Federal Reserve's Survey of Consumer Finances (SCF) is the gold standard for U.S. household wealth data. The most recent published data is from the 2022 survey (released October 2023). The 2025 survey is currently being collected with results expected in late 2026.
| Age Group | Median Net Worth | Average Net Worth | 75th Percentile | 90th Percentile |
|---|---|---|---|---|
| Under 35 | $39,000 | $183,500 | ~$150,000 | ~$390,000 |
| 35 to 44 | $135,600 | $549,600 | ~$470,000 | ~$980,000 |
| 45 to 54 | $247,200 | $975,800 | ~$780,000 | ~$1,760,000 |
| 55 to 64 | $364,500 | $1,566,900 | ~$1,100,000 | ~$2,600,000 |
| 65 to 74 | $409,900 | $1,794,600 | ~$1,200,000 | ~$3,200,000 |
| 75+ | $335,600 | $1,624,100 | ~$900,000 | ~$2,750,000 |
| All households | $192,900 | $1,063,700 | -- | -- |
Source: Federal Reserve Board, 2022 Survey of Consumer Finances.
Why the Median and Average Are So Different
The median U.S. household net worth is $192,900. The average is $1,063,700. The average is more than five times the median because net worth is extremely top-heavy. A small number of ultra-wealthy households pull the average far above what a typical family actually has.
This is why you should compare yourself to the median, not the average. The median represents the middle household. Half of households have more, half have less. The average is distorted by billionaires and tells you nothing useful about where you stand.
The Wealth Curve
Net worth follows a predictable arc. It starts low in your 20s and 30s because you are early in your career, likely carrying student loans, and probably just bought your first home. It climbs steeply in your 40s and 50s as your income peaks, your mortgage balance drops, and your investments compound. It peaks between 65 and 74 at a median of $409,900, then declines as retirees draw down savings.
The 75+ decline from $409,900 to $335,600 reflects retirement spending. At a 4% withdrawal rate, $409,900 produces approximately $16,400 per year in investment income. Combined with Social Security (average approximately $1,900 per month in 2026), that is a modest retirement. This is why starting early and saving consistently matters so much.
How to Use Net Worth to Track Progress
Your net worth is a snapshot. A single number tells you where you are today. But the real value comes from tracking it over time.
Calculate your net worth once per quarter. Update your asset values (investment balances change automatically, home values shift slowly) and liability balances (debt should be declining). Plot the trend.
A healthy net worth growth rate is 5% to 15% per year in your 30s and 40s, slowing to 3% to 8% in your 50s and 60s as investment returns become a larger share of growth relative to new contributions.
If your net worth is declining or flat, one of two things is happening: you are spending more than you earn, or your investments are losing value. The first is fixable with budgeting. The second is usually temporary if you are properly diversified.
Use our Budget Calculator to identify where your money is going and find surplus to invest.
Real-World Scenarios
Sarah: 32, Feeling Behind
Sarah is 32, earns $72,000, and has:
- $8,000 in checking and savings
- $22,000 in her 401(k)
- $6,000 in a Roth IRA
- A car worth $14,000 (auto loan balance: $9,000)
- $28,000 in student loans
- $3,200 in credit card debt
Assets: $8,000 + $22,000 + $6,000 + $14,000 = $50,000 Liabilities: $9,000 + $28,000 + $3,200 = $40,200 Net worth: $50,000 - $40,200 = $9,800
The median for under-35 is $39,000. Sarah is below the median. But she is 32, has started investing, and her 401(k) is growing. If she increases her 401(k) contribution by 2% and pays off her credit cards, her net worth will accelerate. She should project her retirement balance using our 401K Calculator to see where she is headed.
James and Maria: 48, On Track
James and Maria are 48. Combined income is $155,000. They have:
- $25,000 in savings
- $185,000 in retirement accounts
- $75,000 in a brokerage account
- A home worth $420,000 (mortgage balance: $210,000)
- Two cars worth $28,000 total (one paid off, one loan balance: $12,000)
Assets: $25,000 + $185,000 + $75,000 + $420,000 + $28,000 = $733,000 Liabilities: $210,000 + $12,000 = $222,000 Net worth: $733,000 - $222,000 = $511,000
The median for 45 to 54 is $247,200. James and Maria are well above the median, sitting between the 75th percentile ($780,000) and the median. They are in solid shape for retirement. They should use our Retirement Calculator to confirm their trajectory.
Robert: 62, Pre-Retirement Check
Robert is 62, earns $95,000, and has:
- $15,000 in savings
- $380,000 in his 401(k)
- $45,000 in an IRA
- A home worth $310,000 (mortgage balance: $65,000)
- A car worth $18,000 (paid off)
Assets: $15,000 + $380,000 + $45,000 + $310,000 + $18,000 = $768,000 Liabilities: $65,000 Net worth: $768,000 - $65,000 = $703,000
The median for 55 to 64 is $364,500. Robert is nearly double the median, approaching the 75th percentile ($1,100,000). He is in good shape. At a 4% withdrawal rate, his $425,000 in retirement accounts produces approximately $17,000 per year. Combined with Social Security, he should have a comfortable retirement. He should verify his Social Security estimate with our Social Security Calculator.
Common Mistakes
1. Counting your home's full value but forgetting the mortgage. Your home is an asset, but the mortgage is a liability. Net worth counts the equity, not the purchase price.
2. Not counting vehicles. Cars are assets. Use current market value (Kelley Blue Book or Edmunds), not what you paid. They depreciate, so update the value annually.
3. Ignoring retirement accounts. Your 401(k) and IRA are assets, even if you cannot access them without penalty yet. They are part of your net worth. Include the current balance.
4. Comparing to the average instead of the median. The average net worth is $1,063,700. The median is $192,900. The average is distorted by the top 1%. Compare yourself to the median for a realistic benchmark.
5. Not accounting for depreciation on assets. Your car loses value every year. Your home may gain or lose value. Update your asset values at least annually to keep your net worth calculation accurate.
Estate Tax: When Net Worth Triggers Tax Concerns
For 2026, the federal estate tax exemption is $13.99 million per individual and $27.98 million per married couple. If your net worth approaches these thresholds, estate planning becomes critical. Estates above the exemption face a 40% federal tax rate, plus state estate taxes in some states.
Use our Estate Tax Calculator to estimate potential federal estate tax liability.
External Research and Resources
- Federal Reserve Survey of Consumer Finances is the authoritative source for U.S. household wealth data. The 2022 survey (released October 2023) provides the most recent published net worth benchmarks by age. The 2025 survey results are expected in late 2026.
- Federal Reserve Distributional Financial Accounts provide quarterly updates on aggregate household wealth by age and percentile between SCF releases. As of mid-2026, aggregate household net worth for the 35 to 54 cohort is approximately 11% to 14% above 2022 levels.
- Consumer Financial Protection Bureau: Build Wealth provides government-backed guidance on building net worth through saving and investing.
People Also Ask
What is the average net worth by age in the US?
According to the Federal Reserve's 2022 Survey of Consumer Finances, median net worth by age is: under 35 ($39,000), 35 to 44 ($135,600), 45 to 54 ($247,200), 55 to 64 ($364,500), 65 to 74 ($409,900), and 75+ ($335,600). The overall median is $192,900.
How do you calculate net worth?
Add up all your assets (cash, investments, real estate, vehicles, and anything else of value) and subtract all your liabilities (mortgage, loans, credit card debt, and any other debt). The result is your net worth.
Should I include my home in my net worth?
Yes. Your home's market value is an asset, and your mortgage balance is a liability. The difference (your equity) is part of your net worth. However, since home equity is not easily accessible, some financial planners also calculate "liquid net worth" excluding the primary residence.
What is a good net worth for my age?
Compare yourself to the median, not the average. The median represents the typical household. If your net worth is above the median for your age group, you are doing better than half of U.S. households. If you are below, focus on increasing savings and reducing debt.
Related Calculators
- Net Worth Calculator - Calculate your total assets, liabilities, and net worth
- Estate Tax Calculator - Estimate federal estate tax on an inheritance
- Retirement Calculator - Estimate retirement savings and income needs
- 401K Calculator - Project your 401(k) balance at retirement
- Social Security Calculator - Estimate your Social Security benefits
- Budget Calculator - Plan your monthly budget
- Investment Calculator - Project future value of your investments
- Present Value Calculator - Calculate present value of future cash flows
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