According to The Wall Street Journal, the average net worth per person in America was $182,000 back in 2010. Then came a 2014 Credit Suisse survey highlighting the average net worth in America is a whopping $301,000 (see pic)! Now in 2017, the average net worth for Americans is even higher thanks to a bull market in stocks and real estate.
Originally, I had my doubts about the $182,000 figure, since the median 2007 net worth of all US households is $109,000 based on a Federal Reserve survey. However, could it be that everybody in America can all buy new Porsche 911 Turbos with plenty of money left over if they wanted to? After some thought, I shared the story over social media to see what the community would say, and the negative responses astounded me!
NOBODY BELIEVES IN REALITY
No sooner did I send the link out did people start discrediting the figure. They used straw hat arguments such as “Bill Gates skews the average” and using average, instead of median, or mean is misleading. Average is average, and we can have 10 Bill Gates in America, and the average net worth still wouldn’t be abnormally skewed among a denominator of hundreds of million! Don’t believe me? Do the math yourself and see how much change an average $150,000 per person net worth figure out of 200 million is once you include 10 people worth $50 billion each.
What’s more interesting is that the naysayers who are so determined to discredit the Wall Street Journal and Credit Suisse all have net worth’s greater than $182,000. It’s the darndest thing I tell ya. It would be one thing if they were all 35 years old with only net worths of under $50,000 or something. But they aren’t.
I’ll admit I’m over this figure, and so are all my colleagues who are over 30 years old as well. Given this is the case, I now easily can see why the average net worth per person is around $182,000. Heck, it might even be higher! The average age in America is around 35, and based on a sample set of around 20, there’s no reason not to believe in this figure.
The Dow Jones Industrial Average is at a record highs at 19,100+, the S&P 500 is at a record high at 2,200+, and real estate prices in major metropolitan areas like New York City and San Francisco have all breached 2007 prices to reach new all-time highs as of 2017. Clearly, the economy has improved a lot since the 2008-2010 financial crisis.
THE REASON WHY THERE ARE DISBELIEVERS
There are two main ways to get ahead: 1)outperform others or 2) hope others underperform you. I always prefer to rely on myself to try and outperform because I have no control over what others do. The only person I can control is myself! Furthermore, the better the average does, the less you feel great about yourself.
As a result of this phenomena, it is no wonder why everybody tries to discredit the Wall Street Journal’s $182,000 average net worth per person figure and Credit Suisse’s $301,000 average net worth figure? The figure is an attack on their own success and makes them not feel as good about their own wealth accumulation.
HUSTLE AND MAKE NO EXCUSES
It’s important to realize there’s no escaping the bell curve. At every level of competition, there will always be underperformers, folks in the middle, and outperformers. We consistently tend to OVERESTIMATE our own success and abilities and think we’re better than everyone else. You know by definition that this is statistically impossible.
Instead of trying to keep people down to make yourself feel better, I encourage everyone to celebrate the success of others. Use their success as motivation for your own sake. The more you encourage others to succeed, you will rid yourself of that negativity that plagues your mind and flourish.
If you want to know what the average net worth is for the above average person is, here’s a table for you to check out. Remember, this table is for above average people. The above average person regularly maxes out his or her 401k, saves at least 20% of their after tax, after 401k income, regularly invests in a well-diversified portfolio, and believes they deserve to be rich.
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About the Author: Sam began investing his own money ever since he opened an online brokerage account in 1995. Sam loved investing so much that he decided to make a career out of investing by spending the next 13 years after college working at two of the leading financial service firms in the world. During this time, Sam received his MBA from UC Berkeley with a focus on finance and real estate. He also became Series 7 and Series 63 registered. In 2012, Sam was able to retire at the age of 34 largely due to his investments that now generate roughly $200,000 a year in passive income. He spends time playing tennis, hanging out with family, consulting for leading fintech companies and writing online to help others achieve financial freedom.
FinancialSamurai.com was started in 2009 and is one of the most trusted personal finance sites today with over 1 million pageviews a month. Financial Samurai has been featured in top publications such as the LA Times, The Chicago Tribune, Bloomberg and The Wall Street Journal. Post has been updated for 2018 and beyond.