The Top 1% Net Worth Amounts By Age: Are You Rich Enough?

Getting to the top 1% net worth by age is a very impressive goal. But how much money do you need to get there? Overall, to have a top 1% net worth in 2023 requires having at least $13 million according to the Federal Reserve.

$13 million is $3 million above the ideal net worth amount for retirement based on a poll I conducted a couple of years ago that had thousands of entries. For reference, the estate tax threshold is $12.92 million per person. Hence, we can use the estate tax threshold as a guide for a top 1% net worth.

People like to throw around random net worth figures all the time when asked how much is considered rich or how much they would need to never work again. Often, the figures just sound nice, like saying “one meeeeleon dollars” without any mathematical justification.

This post puts some numbers behind ascertaining how much wealth one needs to be in the top 1%. To pay less taxes, having a large net worth is better than having a high income. The government goes after income more than it goes after wealth.

But if you are retired, then cash flow is more important than net worth. As a retiree, you income is what will maintain your lifestyle.

The Top 1% Net Worth Amounts By Age

I'd like to construct two simple models to demonstrate what I think should be considered a top 1% net worth by age. All wealth and no income is not ideal. Similarly, all income and no wealth is not ideal either. There needs to be a balance.

We know the constant variable X (top 1% income). All we have to do is solve for Y (top 1% net worth) based on Z, an agreed upon income multiplier determined by yours truly.

A Top 1% Income Has Increased Tremendously Since 2016

Back in 2016, when I first wrote this post, a top 1% income in America was $380,000. Thanks to economic growth and inflation, a top 1% income in America is now $650,000. Further, a top 1% income varies by state.

To have a top 1% income in Connecticut requires an income of over $955,000. In California, a top 1% income is at least $805,000. In New York, a top income is at least $818,000. However, in West Virginia, you only need to earn above $374,000 to earn a top 1% income.

But overall, a top 1% income in America is $650,000, so we will use this figure in calculating my top 1% net worth by age guide.

The Assumptions To My Top 1% Net Worth By Age Guide

  • $650,000 is the constant top 1% income variable
  • The Ideal Income Multiple increases over time
  • A net worth equal to 20X your average gross income equals true financial independence
  • A multiple of income is superior to a multiple of expenses to determine a top 1% net worth because income is harder to manipulate

Top One Percent Net Worth By Age Chart

Have a look at the chart below. It's a good snapshot of top 1% net worth starting at age 25. To have a top 1% at 25 requires a net worth of at least $250,000. To have a top 1% net worth at age 30 requires a net worth of at least $1 million and so forth.

top one percent income and top one percent net worth in America for 2023

As the latest Federal Reserve Consumer Finance Survey shows, the average American household is now a millionaire with a net worth of $1.06 million. But the median American household net worth is about $193,000.

Given you're shooting for a top 1% net worth, you can look at the chart and see a top one percent net worth target of $5 million at age 40. Does $5 million seem like a reasonable top 1% net worth threshold if the average is about $1.06 million and the median is about $193,000? I think it does.

My top 1% net worth by age can also be used for households, which can consist of individuals or couples.

More Notes About The Top 1% Net Worth Chart

  • Top 1% net worth is relative to our ages. It's unfair to compare a 60 year old's net worth to a 25 year old's net worth because the 60 year old has had 35 more years to accumulate wealth.
  • Younger people in this chart will logically have a tougher time getting to the top 1% income figure of $500,000 compared to older people. At the same time, the multiplier younger people have to hit to get into the top 1% net worth is also lower. I start at age 25 because so few people will make $500,000 within a couple years out of college.
  • If you have around a $255,000 net worth at age 25, you're in the top 1% probably due to some savvy investments made right out of college. Income alone isn't going to cut it. You may have just started making a top 1% income of as a highly coveted software engineer or finance whiz. Or you could have started a business or made a lucky investment.
  • The minimum income multiplier peaks at the traditional retirement age of 65. It is pointless to accumulate so much more money when you've got less than 35 years to live. Social Security is available at 65, adding another million to your net worth if you capitalize its annual payments.
  • In 2023, $12.92 million is the limit per individual one can pass on before the Death Tax kicks in. Therefore, you might as well spend every single last penny above the estate tax threshold on yourself, loved ones, or charities instead of giving it to an inefficient government.
  • The top 1% net worth figures in the chart are for individuals. But, feel free to use the net worth figures as targets to shoot for if you are a married couple as well since you are a unit. For couples, the estate tax threshold is $25.84 million in 2023.

Replicating Top 1% Net Worth By Lifestyle And Savings Rate

The definition of “rich” can be someone who no longer has to work for a living, while maintaining a top 1% income earning lifestyle. This is where things get a little tricky, because many people spend $500,000+ differently.

When I was making big bucks, I would always save at least 50% of everything I earned after maxing out my 401k. I knew the income wouldn't last forever because the job was not sustainable.

Given my 50% savings rate, a $500,000+ gross income lifestyle could be matched by someone spending 100% of his $250,000 gross income. Hence, my goal since retiring in 2012 was to try and replicate the gross income I lived off of in retirement through passive income.

On the other hand, many of my colleagues easily spent 90% – 100% of their $500,000+ gross incomes. One close colleague told me, if he didn't make at least $500,000 a year, he couldn't save any money! He required at least $300,000 a year after-taxes to support his family of four. Talk about a high burn rate.

Related: How To Make $200,000 A Year And Not Feel Rich

More Definitions Of Rich

A top one percent net worth is by definition rich. But let's look at more definitions of rich based various economic factors.

The risk-free rate (10-year bond yield) is currently around 5%. Therefore, one needs a net worth of roughly $10 million ($500,000 / 5%) to be able to generate $500,000 a year in top 1% income. In other words, thanks to a high risk-free rate, one needs about $3 million less to replicate a top 1% net worth lifestyle.

It's worth adjusting your safe withdrawal rate in retirement, depending on where the 10-year bond yield is. Have a dynamic safe withdrawal rate to change with the times.

In today's interest rate environment, $10 million can therefore be considered rich enough to be in the top 1%. As the risk-free rate declines, the amount of capital required to be rich increases and vice versa. In a higher interest rate environment, it's actually easier to generate passive income.

The Ideal Income For Maximum Happiness May Equal A Top One Percent Net Worth

Another net worth calculation is using the ideal income for maximum happiness. We can assume the goal of being in the top one percent is to be happy.

I think that ideal income is $200,000 per individual and $350,000 per couple living in a coastal city. Once you earn these gross income figures, your happiness no longer increases due to money. You are making enough to survive and feel happy.

Therefore, using the same 5% divisor, we can get $4 million for an individual ($200,000 / 5%) and $7 million ($350,000 / 5%) per couple as a top one percent net worth for maximum happiness.

If the risk-free rate declines to 2.5%, the ideal income for maximum happiness can stay the same. In a lower interest rate environment, the $200,000/single and $350,000/per couple incomes goes farther. However, the net worths required to generate these ideal incomes double to $8 million and $14 million, respectively.

If you don't live in an expensive coastal city, you could probably reduce the $200,000/$350,000 income figures by 30% – 50%. Then divide the numbers by the risk-free rate to come up with your personalized top 1% net worth for maximum happiness.

So let us embrace this high-interest rate environment. It enables us to work less, relax more, and feel more secure. If and when interest rates eventually decline, we'll need to work harder to grow our net worths.

Getting To The Top 1% Net Worth Is Possible

The sad part about a top 1% net worth is that it seems like it's getting harder to achieve. Some of the reasons are inflation, globalization, more volatile investment returns, and more frequent boom-bust cycles. Inflation is a real killer if you're not on its right side.

Only one percent of people can achieve a top one percent net worth. Hence, it may not be worth trying to save, invest, and work so much to beat out ninety nine percent of your peers. You could end up incredibly miserable for a long portion of your life!

Instead, a great short cut is to feel rich without technically getting rich. Feeling rich includes feeling grateful for the things you have today that you wanted yesterday.

I remember feeling incredibly rich when I was a study abroad student in Beijing in 1997. My dorm room was 88 degrees at night and my roommate and I were sweating buckets each night. But we felt thankful every eight seconds our fan rotated towards. We were poor students, but we also felt incredibly rich to be on such a great adventure.

Thankfully, you don't need a top one percent net worth to feel rich. If you have enough to pay for your living expenses, family and friends who love you, and your health, you are rich no matter what your net worth tracker says!

What is the minimum net worth amount to be considered rich?

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Invest In Real Estate Like The Top 1%

If you want to get a top 1% net worth, invest in real estate. Real estate is a core asset class that has proven to build long-term wealth for Americans.

Real estate is a tangible asset that provides utility and a steady stream of income if you own rental properties. Further, the wealthiest Americans own tremendous real estate portfolios.

Own your primary residence to get neutral real estate. Then invest in real estate by buying rental properties and real estate online.

My favorite private real estate platform is Fundrise. The company began in 2012 and manages over $3.3 billion in assets for over 400,000 investors. Fundrise's focus is on residential real estate in the Sunbelt region where valuations are lower and yields are higher. The demographic shift toward lower-cost areas of the country is a multi-decade trend.

I've personally invested $954,000 in private real estate funds and individual deals since 2016. My goal is to take advantage of lower valuations in the heartland of America to diversify my expensive San Francisco holdings. Real estate is currently in a downtrend due to higher mortgage rates, which is why I'm buying now.

Invest In Private Growth Companies

Finally, the richest Americans start businesses and invest in private businesses. Therefore, consider diversifying into private growth companies through an open venture capital fund. Companies are staying private for longer. As a result, more gains are accruing to private company investors.

Check out the Innovation Fund, which invests in the following five sectors:

  • Artificial Intelligence & Machine Learning
  • Modern Data Infrastructure
  • Development Operations (DevOps)
  • Financial Technology (FinTech)
  • Real Estate & Property Technology (PropTech)

Roughly 35% of the Innovation Fund is invested in artificial intelligence, which I'm extremely bullish about. In 20 years, I don't want my kids wondering why I didn't invest in AI or work in AI!

The investment minimum is also only $10. Most venture capital funds have a $250,000+ minimum. In addition, you can see what the Innovation Fund is holding before deciding to invest and how much.

The Top 1% Net Worth Amounts By Age is a Financial Samurai original post. Join 60,000+ others and sign up for my free weekly newsletter where I share more tips on how to achieve top one percent wealth. I've been helping people achieve financial independence since 2009.

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147 thoughts on “The Top 1% Net Worth Amounts By Age: Are You Rich Enough?”

  1. John Burton

    Love your content. I am always fascinated by the thinking of other like minded people. Good fortune and health to all.

  2. I am 45, married no kids. $250k annual income in charleston sc. net worth $1.5m and we save $50k per year in retirement savings and $25k per year in cash savings to pay off mortgage which is out only debt. We owe $150k there. Target goal is $4m net worth and $3m investments by age 60 which seems we are on track for. We still feel middle class……

  3. I am a 51 year old with $4.8mm networth – 67% in the market (MFs, ETFs, Individual Stocks), 33% in Cash (HYS, CDs, MM). 65% Pre-Tax (401k, IRA, Stocks, Pension), 35% Post-tax. I don’t have any real estate currently but planning to take about 15-20% of net worth to purchase primary residence for cash in California or Nevada. Prefer Nevada as it is no-tax state (401k, SS, Pension, No state tax) but leaning toward California primarily due to better access to top of the line medical facilities. I was doing better until my returns in 2022 got killed as I could not pay attention to my investments due to personal issues. Here are my returns over the last 14 years starting in 2010

    11.96%, 15.36%, 27.11%, 29.48%, 19.31%, 10.14%, 17.41%, 32.40%, 36.31%, 9.92%, 20.82%, 16.61%, -11.94%, 23.57%

    At an average of 5% returns working till 65 I would be at close to $10mm NW and 10% returns would be close to $20mm. I am not sure I want to work past 62. So, I am hoping for close to $8-15mm networth by the time I am ready to call it a day. Please give your feedback am interested in hearing what you think.

  4. Question — you said you saved 50% of your gross income after maxing out your 401k. How is that possible? even in a tax free state, you will pay approx. 30% in federal tax, 3% in SS and 2% in medicare. That means that your after tax income would be around $325,000 and you claim to have saved $250,000. Did you really live off of $75K? If you lived in a tax state, it would be another 5-10% less. I always find articles where people claim high savings rates to be a bit of disservice because maybe you mean 50% of net income (after tax), which would still be good, but certainly quite different from 50% of gross.

  5. $13M starting for top 1% in 2023??? Horse manure! With well over 30% of the Stock market value wiped out in 2022 alone, combined with high inflation throughout 2023, A more representative of top 1% net worth would be less than $10 M.

  6. Reading these replies makes be sad. It seems the majority have the one-more-year syndrome and everytime they reach their goal, they just stay on the treadmill and increase their goals higher. Great, I guess, if your reason for living is the work that you do, but how many *really* enjoy what they do? I suspect not many.

    For us, when we had reached our goals in our early 50’s, I made the call to retire. I worked in banking and the grind did not make me happy. What is the point at that age of continuing the grind to increase our net worth from $4m to $6m or $8m while giving up my 50’s – the decade many find is their last one of relative youth.

    I am now 59. We are mobile and travel. In 2023 we have been to 8 countries, spending roughly similar periods of time in each – those countries cover most of the world. From New Zealand to Ireland and 6 others in between. Our net worth for our age is quite far from the 1% figures in this article, yet our net wealth is about 45 times our 2023 spend, and our net wealth is growing. If anything, we will ultimately need to spend more and/or give money away.

    And 2024 is coming and another year of travel is planned.

    In my view, WE ARE RICH and probably among the luckest people on this planet. Every single day is a day doing what WE want and travel is the ultimate life-style (in our view). We don’t need the 1% net wealth – and the very marginal increase in our life-style a few more million would provide is totally out of proportion with the time and stress it would take to accumulate it.

    My advice – the 1% numbers are no more than a passing interest. Seriously, forget about the 1%. Stop the one-more-year syndrome. Stop comparing with others. Stop increasing your goals and loosing more time chasing more money you don’t need – which you likely do because you are comparing with others. Plan what YOU need for YOUR life with YOUR circumstances. THAT is how you become HAPPY. You will NEVER become happy if you continue to compare with others. So forget the 1%. I don’t care at all for it. We are TOTALLY HAPPY and therefore TOTALLY RICH with the ~$4m we have in our late 50’s, a life of freedom answering to no one, and travelling the globe.

  7. I agree it doesn’t take an actual 1% net worth to feel rich. Yes it would help a lot to have multiple millions, but it’s not necessary. Rich is largely a mindset. I say this because I know people who have less than $50,000 to their name who can’t stop smiling day after day vs other people with single to triple digit millions who are grouchy and miserable every day.

    I also agree that real estate is often a significant way to grow wealth exponentially. That and owning equity in business(es).

  8. Tanner Barge

    Do you plan to update your numbers based on the most recent data reported by the US government?

  9. 30 years old here from Dallas, TX. Started a contracting and landscape business at 23 (2015) that does over $7 million in revenue today. By the time you calculate my cash flow multiplier of 6x and then subtract my debt on trucks and equipment I am sitting at $1.6 million. I got a lot of offers to buy my business using the 6x multiplier EBITDA. I also bought two flex industrial spaces for $600k (put $120k down) that I lease to a trucking company cash flowing $1500 a month (after mortgage, taxes repair). My goal is one commercial building a year and to buy other landscapers out through my 30s and 40s and scale. Right now with all writes offs and deductions my income is average $250-$300k year which I invest all my profits back into my business or property. I did buy a Porsche in 2021. I don’t really stress about driving a car that nice but I do think your 5% net worth rule is good which technically I am over that percentage. I believe business and real estate is the best path for someone who is young to build wealth. I have a personal goal of building a company that does 9 figure revenue and owning alot of real estate. I also bought my first home at 28 for $400k which I don’t include in my net worth. Money and building net worth is my hobby. You don’t have to be in a flashy tech business. I’m a simple contractor and Mon-Fri I drive a a $10k car and wear mud boots. I only drive my Porsche on a Sunday or special event. Keep it low key and invest invest invest. I also have a staff of 50 and includes office staff of 10 that run the biz. I could maintain where I’m at and work less if I wanted but as I mentioned my goal is 9 fig rev and sell to private equity or publicly traded company. Then live off my real estate income and probably dabble in developing properties as a passion. I want to say your website has been a tool for me since 2015 when I went to business for myself. I have spent hours here. I finally ordered your book today and can’t wait to read it. Thank you for everything you do as I had no financial education or upbringing. I had to figure it out and financial samurai has helped me so much. Excited to keep wealth building and I strive to be better as a businessman and investor everyday.

    Anyone in Dallas who wants to connect Love to talk business and investing with other like minded folks.

      1. At least you aren’t offended!

        I hope more people key in on the conclusion, which asks whether it’s worth saving, investing, and working so hard, and for so long to try to get into a place that only at 1% of the population is in.

        You can be just as happy or much happier with less than a top 1% net worth.

  10. I find this article interesting, the comments even more so… I am 31 and have a net worth of roughly $1,000,000 all of which is self made. 3 years ago when I started my company I was 60k+ in student loan, IRS, and credit card debt. My wife and I were living in an RV in a trailer park living off our credit cards to build the business. Today my company is growing faster every day and that fuels my net worth even more. I unfortunately have no inheritance nor will receive any. Neither my wife nor I come from affluent families. More over we will need to support our aging parents. Some generations must break the cycle by supporting those both above and below them on their family trees.
    I believe in building a highly profitable “money printer” (business) that you control. Then take that earned income and invest it in passive assets which can depreciated against your cash flow to a taxable amount of less than or near zero. This I believe is how those in the 1% in their late 30s-40s do it. I choose real estate and really don’t understand how many of the readers have high net worths but no real estate. It blows my mind! It’s an asset you can leverage, generates cash flow, appreciates, and has a world of tax benefits… why on earth would you choose paper you don’t control???
    Overtime my real estate income will replace and surpass my earned income resulting in a healthy tax sheltered retirement income which grows over time. It will be near mathematically impossible to spend my money before I die after 30 years of continuous growth. That’s a legacy that has no expiration date. Why does your article reference % rules which factor eating your principal?
    I am new to wealth but mathematically, it seems riskier to have a negative in any part of the equation regarding the principal investment. Any “horizon” is the inevitable zero at the end of your percentage rainbow. Would it not be better to live off the cash flow of paid off real estate which overtime will become a self sustaining machine which provides its own reinvest capital?

    1. i am 46 yrs old with a $3mm net worth. i have 9 rental properties which i just cashout refi’d. all my debt is serviced by rents. I can essentially live free if I rent my main residence and move to a cheaper state w/ rents that are reasonable. thinking about hanging it up but I keep working full-time because I do not like real estate market right now and think their may be some wood to chop there soon. thoughts?

  11. Good article that I have returned to from time to time for updates. Although the income multipliers don’t work for super high income individuals.

    My general rule for wealth is to take the income you want to achieve and use a simple multiplier to find the amount you need in assets to generate that income passively. Having assets that produce a passive income is true wealth. That’s it.

    The key is to choose your income and multiplier carefully. I agree with Sam that the 4% rule is antiquated, and it was really intended originally to offer guidance to retirees with a 30 year horizon. So instead of the old 25X multiplier (4% draw) I use a 33.3X multiplier (3% draw) as a base line, with a 40x (2% draw) multiplier as an upper range goal for safety.

    Everyone’s income goal is different depending on location and lifestyle.

    For comparison, my goal is 100,000 in income per month or 1,200,000 in income per year. I vest in a 200,000 per annum pension in 5 years, so need to fund the remaining 1MM income through my own investments.

    For that, I estimate I need between 33.3 million and 40 million in assets, excluding real estate. I should cross the 30 mm mark in about 60 days with a profit distribution at year’s end. That is all equity, cash and c/e. I have had no real estate, as my job has required me to be mobile, although I am buying a primary residence now in the 4mm range in NYC, after renting a very modest place for years. I anticipate 5 more years of high income in the 8 to 12 mm range per annum, ‘retiring’ at 57 with 40 to 50 mm saved, having overshot my safety goal. We have no heirs. We inherited nothing, as our parents are still alive, although they paid for some of our educations, we covered the rest and expect nothing more.

    For background, we wanted a large passive income because we have become accustomed to certain standard of living in the past 15 years. Although we are diligent savers, we still have a burn rate of about 350K per year after taxes. mostly going to experiences, high end travel, great food, a full time maid/cook, and we live part time in NYC and part time abroad. I am budgeting for a burn rate of 600K in retirement. I will need 10K per month to cover housing and associated costs, 2K utilities, 3K insurance, 15K staff, 3K food and entertainment, 3K membership fees to clubs, gifts and charity, 1K to clothing, toiletries and miscellany and the rest toward travel and taxes.

    All that said, I could just as easily move into the Cape Cod house for sale next to my parents place for 400K and live quite merrily among friends and family back home on 120K per year or 10% of the above, so I should be good whatever happens.

  12. Laudate Sapientiam

    I would love for the author to explore how people actually became 1-percenters early in life—I don’t care what it takes to be a 75 year-old rich dude, what’s the fun in that?! I do not believe that 1 percent asset wealth is achievable by working a W-2 job. Nor do I believe it’s as by being lawyers or doctors working 3,000 hours a year. Both force one to spend too much on taxes and do not scale up.

    While it may be that the majority of millionaires hold their assets in real estate, and are penny pinchers (great fun), I believe that the majority of under-50 year old 1-percenters made their money from owning a corporation. The main problem for accumulating wealth is that it does not pay to have a high taxable income through salary (W2 or 1099). Mark Zuckerberg as CEO of Facebook has an official salary of less than $100K! His main wealth accumulation is through stock and stock options. To get wealthy, one has to have equity in a company. You can start one, or join one and get paid in stock options.

    I know a number of individuals with $30M-$200M in net worth, all of them made their money through corporate exit. None of them were in the 1 percent asset category until they had an “exit.” This was my case too. I would argue that wealth accumulation is a “hockey stick” resulting from a very un-diversified investment in a closely held company for 5-20 years. For 1% asset wealth, there is a long period of flat wealth growth when the individual “invests in himself/herself” and then a huge spike (the IPO, the business sale, etc.). If you are not ready to start a company, it is far better to be employee #50 in a company that will have an IPO than a high salary hack at a Fortune 500. You will learn more in a start-up environment and take a very non-diversified risky bet by getting stock options. You will likely fail a few times, but do not consider that the end, consider it as “on the path to success you will often meet failure.”

  13. The 1% net worth by age is quite interesting actually. It looks like from 25-30 your 1% NW would almost quadruple, while 30-35 it’d almost triple, and 35-40 it’s almost a double.

    Seems to almost imply that as we get older in age, it’s sufficient to pursue a lower return and ease on taking risks to increase net worth?

    Or is this decline in rate of net worth increase mostly due to the 65 year old $11.75MM goalpost and it’s sufficient to slow down as we get older to that point?

  14. Andrew Gerber

    I revisit this page every few years. 55 now with 4M net worth; 1.5M in property and the rest in taxable and non-taxable accounts. I’ve never earned more than $200K a year; most of my assets are due to regular investments, modest stock grants from jobs, spending less than I make, a $250K settlement from a motorcycle accident 20 years ago and a $400K inheritance in 2014 from a family trust. I realize now that I have more money than I will ever likely need. Currently working for a national firm that actually has a *pension* if I stay another 3 years will vest in a modest one, 8 years would be a pretty decent one. Enjoy my work enough that it might happen.

    I encourage people with significant assets during this difficult time to give money away; to food banks; to rental assistance; etc. Look into moving highly appreciated assets into a Charitable Giving Account (mine is at Schwab); you get the tax deduction when you move the assets, not when you make the donation. Then you can issue checks from that account to any charity you want.

    1. Congrats and thanks for checking in!

      I hope more people who have saved and invested diligently spend more time spending and helping others. Dying with too much is a crying shame. So many people in need.

      I am motivated to keep writing on FS every week for free to help people make better financial decisions.

    2. Excellent analysis. Your articles always puts things in the right perspective. One question though: You mention a target of some $11M for financial freedom at the age 65. How does that number change if one wants to retire a little earlier, say at 55?

      I am 47, at $4.5M liquid networth plus owning a business. I am not as frugal as I should be so am aiming to go for a little higher target of $15-20M at retirement. I am planning to achieve that by continuing to save and invest regularly and having a liquidity event from exiting my business.

      Fingers crossed

  15. Sanjay Patel, SP 364

    I came to this country with $32 in 1995. Only thing I had was blessings from my parents and God! I worked hard and started built a very good business and sold it to a NASDAQ listed company for $$$$. I was married in 1999 and had son when I was still in training , I could not spent time with him after that because of business….. I am worth $100 million dollars but when I think about my relationship with my 18 year old…. I feel I am the poorest dad!

      1. Wow! Did you not even hear what he said? He feels poor bc of his relationships and you are focused purely on the money. That’s why you can co spider yourself wealthy but not rich. I get that the pure financial aspect is your business but clearly he would give up some wealth for better filial relationship. You said it yourself elsewhere in the comments so why ignore it here?

          1. Wow. Late to the party but……Just because this is a personal finance site does not mean that emotions are not involved. Sanjay, you are right in reflecting on your personal relationships and looking for a happier path for you and your family. Good Job!? A good job is done by a man who has a net worth of 2 million dollars and looks back on his interpersonal relationships with pride and no remorse.

  16. Milt Warden

    >$9 million net worth here, turning 50 in a few months. Got there thru investing, equity stake in business from management job then started my own biz and sold 6 years later.

    I’d say about 20% of wealth came from investing gains, 15% from mgmt equity stake and 65% from own business.

    If you have the ability to start your own business in a good niche do it! A million times better than being a wage slave, even a highly paid wage slave. And fun as hell. There is no feeling like being your own boss and controlling your destiny.

  17. bryan hoffman

    “A man’s worth is his family.” Michael Corleone (Godfather III)

    Having made high six figures, the realization of sacrificing time for money was too great with a child at home. Money truly does not buy happiness.

    1. I absolutely agree. The first 5 years of a child’s life is so precious. I sacrificed a lot of money to spend time with my son for the past 3 years, and I don’t regret it at all. The moments have truly been priceless.

  18. This is a wonderful post, as are many others I’ve seen on this website.
    I feel Rich because I’m financially free at 40. These net worth calculations would put me in the 1% in terms of wealth, but my annual income is closer to a school teacher’s: $63K/year for the last 5 years. I’m retiring from my W2 job this spring, and my income will decrease even further. Wildly, I’ve just realized the Feds will be giving my family of 4 free healthcare at our income level. This post references that fact: we’re rewarded to be wealthy, not high wage earners.

    For people who don’t understand how wealth is built by Average Joes, my situation is incomprehensible. How do you approach $3M by age 40 with a salary of $63K (zero received from family here; and $100K in student debt to start)? The answers are probably all over this website from the few articles I’ve read. When I was 22 a college teacher gave me a copy of Your Money or Your Life.
    To summarize, I took the lesson of this book to heart and continued learning. Be frugal where it counts (I still drive my 20 year old Jeep from college even though I could go pay cash for a Maserati). By assets, not consumer junk. Focus on your goals. Do your own chores/maintenance on your property(ies). Eat at home. Fine cheap hobbies you love. Hardest of all: figure out how to instill these frugal traits in your children, because wealth is fun to maintain but a bitch to earn.

    1. Excellent points. I came across this because I am looking for an executive position and realize currently I am debt free and have a family of 4 but want more. My business is good not great and I am opening another business with my brother.

      But though I have a nice net worth outside of the top 1 % I live frugally. And during this pandemic I have become debt free paying off a small HELOC for a condo in another country and our home in the US.

      Old values need to be returned to or this country will be destroyed by the socialists.

  19. 2.8 million. 47 years old. Would rather be rich than look rich. I only feel rich enough to be rich, but not to look rich.

  20. jeffrey jensen

    I Love Your Blog! – Whenever my kids ask if we are rich – i tell them, “We are about the HENRYs (high income not rich yet) and well below the rich. They have no clue what I mean. I define rich as 1) not having the drudgery of a job to be a HENRY and 2) being able to stroke a check for a Gulfstream G650.

    I think where you live too skews the definition of rich – we travel to NYC once a year for medical check-ups and I find myself easily spending $300-$500 on dinners for 4 of us and we are not talking Michelin rated places.

    I totally agree with your 2% ROI as what you need to have as “wealth” in order to replace your income. The reason I think the wealth number is much higher is a lot of the time you will have your money locked up in things that don’t produce an ROI – like real estate. Even though I generate rent – if I have repairs or do a 1031 exchange – I find i gotta keep the rent income available for the real estate so that it can run free from additional investments – taxes also take a bite out of it.

    Finally, I know it seems absurd that your former colleagues spent $500K a year on expenses – but just from my brief experience with NYC – I can easily see how someone could do that. I live out west and not in any cosmopolitan city – My kids’ private school is $25K a year x two kids. I consider 401K as “expenses” and ditto for my backdoor Roth IRAs and their 529 college saving plans – so if you add savings to the expense side, we easily push $300K a year with no house payment. For me to make $300k a year I need to have $12 million in liquid assets to get the no brainer ROI on treasury and high-grade commercial paper. I can’t bring myself to keeping that much of my net worth in liquid assets so I keep the job to keep building the pile. One day I’ll take the leap as you did but again – love your ideas!

      1. Stumbled across this site. I am working with an executive search company. I have a net worth of $ 2.8 $ 1.8 in the market and $ 1 in 3 pieces of property. I have a business that is doing OK and am starting another business next year. And this is whether I get an executive position or not.

        I officially became debt free by paying off a small HELOC for a condo in another country and my home in the states. I have another condo that I rent. But I am more concerned with what happens with the government than my career.

        What can happen to all this if the government goes socialist. Can we even protect our assets at that point?

  21. In today’s day of almost 2020 and its inflationary pressures and income insecurities, true wealth can only be defined when enough passive income exists to cover your routine expenses, which varies from person to person. There should also be at least 2-4% additional growth rate above the needed income so the nest keeps up with mandatory future inflation and thus keep generating enough income to last indefinitely. For someone needing 100,000 income, this requires about 2.5 to 3 million saved in INCOME generating assets that earn 5-7% steady income (about 125k-210k annual income). Take 100k for living life and reinvest excess so pot keeps growing forever. Many will try but few will achieve this target. That’s the harsh truth.

  22. I’m 60 and have made ~$800,000 a year for the last 7 years. I have a net worth of ~$4,000,000 on paper and I feel “ok” but not rich. Because about $1,500,000 is tied up in my house and business property that I will never sell. And even though my business has $1,250,000 in the bank, if I withdraw it, I’ll only get to keep about $750,000 of it after taxes. So my liquid net worth is right at $2,000,000 right now and while I should feel rich, I just don’t yet. Maybe if/when my liquid net worth hits $5,000,000 I will.


    Just stumbled on this column and thread and think it’s misleading because it assumes the reader wants to be among the top 1% in the graveyard. Can’t think of any other reason to use the riskless rate of return as a discount rate. I don’t have many friends outside the top 1% and I don’t know any of them who think this way. Most folks I know want to live their entire lives comfortably (as they define “comfort”). Rich people invest their money, as the aspiring rich do. They don’t sit in cash. Far better than using the riskless rate to calculate wealth would be using a discount rate of something like 3% for an age 45 couple, or 4% for an age 65 couple, per the Trinity study and subsequent analyses (like Kitces’s). A 100-year old widow with $1 million in the bank is rich. As for myself, I hope that the second of my wife and myself to die will have less than $1 million in financial assets upon death. More than that and we will have failed in our objective to spend almost everything we don’t give away during our lifetimes.

    1. Ted Shepherd

      My view is different. I have no wish to die broke. (If I had that wish, then maybe I’d by an annuity that expires when I do. That purchase, of course, would make the annuity seller the buyer’s defacto beneficiary for the annuity’s residual value. No, thanks.) I have inherited some assets. Over the years, I have greatly increased the value of those assets even after taxes, inflation, and, in retirement, my living expenses. I keep the capital invested in a way the promotes productivity in American labor by mutual agreement in employment. That is the same bargain the nameless strangers provided to me in my decades of employment; huge capital investments from other people made my productivity on the job significant instead of near zero. Management of these family assets of mine will pass to the next generation (all too soon). In short, spending and donations are not the only worthwhile uses of money; it can serve to support worker’s productivity through their access to capital investments.

  24. I’m 42, have a child, and have a husband who is a big spender. I work for a company with master degree and just signed up for 401K, now I’m considered a middle class tier (recently I got a job with higher pay). I’m reading this article and people’s comments and think how much I’m behind the game and again it scares me so much…. My income doesn’t fall in the category you discuss about and I really don’t now how to get there. All I’m practicing is to spend less but I don’t know what I should do with making more money part. I spoke with a financial adviser and he recommended me to sign up for a life insurance with 6.9% interest (through insurance company) for 20 years and pay monthly but there is still a risk that I don’t get anything extra and end up getting what I accumulated in 20 years. I have little saving that I could hide from “SOMEBODY” so far and it’s equal to two months of my net income and that’s all I have. I’m really scared and don’t know what I should do for me and my child future . Should I continue saving up and when it reaches to a certain amount I have to invest it in something,… I highly appreciate your insight.

      1. Thank you very much for your advise,

        I signed up for 401K with maximum amount I could contribute. I have to wait a few months to plan and budget for the rest of my paycheck to see if I can invest in anything else as I’m responsible for the bills and main expenses! :)

    1. Please do not buy any insurance product (or any other financial product) before consulting at least one other second advisor and also doing your research. Make sure whomever you speak to about your finances is a Fiduciary. It sounds as if your advisor is trying to put you into an annuity which is often high fee (beneficial to him) and not necessarily a good fit for you. You don’t give enough information to make a judgement, but you sound as if you are not familiar with investing, so tread cautiously. Do not panic. Start reading and doing research.

      You might start with a broad based mutual fund that tracks the larger market. A low-fee outfit such as Vanguard, Schwab or Fidelity is a good place to start. They have a range of funds available. Vanguard is a first rate company with some all in one funds that balance the portfolio automatically depending on your targeted retirement date.

    2. wildshrubbery

      I was pretty sure the point in using the low risk rate is another example of setting a low end.

      Even the cash stash invested in some chase freedom savings of $15 million would sustain the same bottom end income as the $380k salary man.

      It makes sense to me.

      This guy just built his own mathematical model to prove that you can mathematically achieve top 1% income happiness.

      I thought it was really fun to read.

  25. The total “target” number is definitely a factor however, most people really need to address personal consumption / overhead and future tax rates going forward in their planning. I’m 44 and a few years away from semi-retiring and spending the days on the golf course (hopefully)! I’m a small business owner (20+ years) and active RE investor who has consistently lived below my means and reinvested a large percentage of my income. My average AGI runs about 400-450k and effective tax rate is in the mid 30’s which fluctuates. Net worth is about 9m. The following is the scenario I debate about when trying to decide when to pull the trigger: Assuming an average return in retirement of 6% (conservative mix of 3-9%) and a 35% tax rate, the after tax net on 9m is about $351,000 per year which is sufficient with no debt (for my objectives). At a 60% tax rate, that number drops to $216,000 and that doesn’t factor in the effects of inflation. With the government in the fiscal condition its in, who’s to say the top tax rate can jump back up to 50,60,70%+ in the future? We have been there before…. Somehow they have to eventually address the shortfall and and you rest assured, it won’t be on the backs of the lower income bracket! Its sad, when people ask me what my concerns are about being self employed, its never the competition that concerns me, its always governmental regulation and tax policies….
    Just a few thoughts to share…

  26. Your age, income, multiplier, net worth chart is very good info for many.
    Suggest you improve it.
    Add a 10% income column and 10% net worth column.
    Many will find those figures closer to where they are.
    Being in the 10% is a comfortable place to be for many.
    It would serve as a “first goal” to give it a name.
    And it would make many feel proud and appreciative that they got there.
    Then the 1% group may not seem so far off.
    Just a thought…

  27. Pingback: The Top One Percent Income Levels By State | Financial Samurai

  28. Pingback: Mortgage Payoff Fees And Procedures To Know | Financial Samurai

  29. I’m confused as to why you assuming income is constant among all age groups.

    I’m pretty sure the 99th percentile of age 25 income is less than 380K, and the 99th percentile of age 50 income is enormously higher.

    1. Sorry you are confused. Let me clarify.

      $380,000 is the top 1% income level for all ages. That is what we know. Too income levels by age are unknown, or at least doesn’t have strong backing.

      The multiplier takes into account some of that income variance by age to get the net worth output.

      So long as the input data is clear, the output data should be clear. You’ve got to have control variables to solve a question. The more certain control variables you have, the stronger the output.

      Can you share how you’d create the model with actual figures? How does your income and net worth stack up?


      1. Financial fire power

        If you reach 470k income at 40, I don’t understand how you are expected to be at 10x, since you presumably have not been at that income the whole time. Agree it would be nice for some realism or at least acknowledgement that you need to be saving much more proportionally earlier to hit these mid targets.

  30. These numbers are interesting, and a decent way to measure net worth, but they are mostly geared for w2 income folks. Those of us that made our wealth through real estate have a number of factors that skew this analysis. Chiefly, if my net income (all from rental properties) is $120k, that is probably closer to $200k gross income for a w2 earner. But in my case I have significant RE deductions (like depreciation), that I pay little taxes to net that $120k.

    Another issue is one’s specific housing situation. Those who have significant equity in their primary residence don’t need to make as much monthly cash to live well. As an RE investor that is even more pronounced as my primary was part of an RE investment project that had high yields.

    Thirdly, for me to have cash to make future investments, I do not need to earn it from cash flow. I get it from (hopefully smartly) tapping into the equity in my properties. The cash out refi or HELOC money I pull out, while a loan, is basically tax free (or tax deferred.). Of course it is only deployed in money making RE ventures, so the loan on that money is paid for by the new project’s cash flow.

    In summation, I always focus on “minimizing” my cash flow. In other words cashflow pays my bills, but it’s the equity appreciation (be it forced equity through development/repositioning or market driven) is what makes me rich. If I’m making so much in cashflow that I’m paying significant taxes on it, I’m not leveraging enough. Of course defining these numbers specifically is highly personal and YMMV.

  31. One factor that needs to be taken into consideration when looking at net worth is what state you live in. If you have a $2 million net worth and you live in California, half of your net worth could be tied up in your home. Whereas, if you live in Nevada, as an example, an even larger home could be owned for around $500,000. This would leave an additional $500,000 for investment assets for the Nevada resident.

  32. Rich to me is when one can retire even if they choose to keep working. For me that number would be 3 million dollars. At 3 mill I would like to have 1 mil+ retirement, 1 mil+ non retirement, and primary residence paid off.

    1. Sounds good to me! Once the primary residence is paid off, living expenses aren’t so bad anymore. I just finished paying off one mortgage, and it feels good. Doesn’t cost to much to eat, transportation, etc. Just kids.

  33. This is a rather strange post. 1% of the population? Really?

    To be in the 1% of the population is mostly “luck”. Did you forget your statistics semester in MBA school?

    99% have less net worth….. Hello? You are no longer middle class.

    And the vast majority of people trying to become part of the 1% will not succeed. It’s basic mathematics! LOL!

    The market segment in which you need to sell to is the “mass affluent”. The mass affluent are the real movers of the American economy. The 1% don’t buy enough stuff to make an economy.

    1. Aspiration is always strange, until it becomes a reality.

      It’s understandable to be salty about shooting for these numbers at a later stage in life. But for those who aren’t retired yet, these are interesting numbers to know and potentially shoot for.

      1. Also known as “survivorship bias”.

        It’s amazing the internal conflict of the nouveau riche.

        1. It’s interesting how many in the top 1% were also in the top 1% in school all along. Not all, but a large percentage, definitely over half. So, is studying for years also luck while everyone else mucks about?

    2. Stealthy1Percenter

      Not succeeding in getting to 1% is acceptable. Not trying is not. Then again, that makes it easier for current 1%ers to stay where they are. Fine by me.

    3. Great blog but At 65 and 40 years in the solar electrical business (electrical contracting) and a 1% er the 1% income graph needs to be inverted towards older ages as as you gain net wealth over time your assets should be generating income and increasing your net worth so it’s the marshmallow test (delayed gratification) if you have the strength to set aside your assets to build more assets and live below your means you can acquire wealth.
      But wanting wealth is different than having wealth and it’s responsibilities of managing it, we all have to make those calls of a well lived life at the end money is the tool to make your dreams come true if you are not out of time acquiring the wealth.
      On our death beds we arrange or assets for the next generation ease of access the only asset that we can control is the quality of time we have left with family and friends. Me, Im now a soalr advocate designing zero energy homes and 1km moon telescope nerd and spending time with friends and family with some great wines.

  34. Todd Guthrie

    This is a very interesting analysis, and certainly provides a good range of goals for those aspiring to “1%” status.
    It does seem to be mostly hypothetical though, and I would also like to see some statistics on actual 1% net worth by age. I’m especially curious how many of the 1% inherited vs earned their wealth. I imagine it would be quite a few.

    1. Less than 10%, there are tons of articles about this all over the internet and books about it as well. Although as you go up the ranks, meaning past 0.1 and then 0.01%, etc, the number gets higher, but it never becomes the majority even at the Forbes 400 level.

  35. So you saved 50% per year after taxes and 401(k) contributions, right? Just wanted to make sure it was after taxes. If not, very curious as to how you did that because taxes are about 45-50% of income in NYC.

    1. Yes, agreed. Taxes are about 45% after Federal, State, and City, this doesn’t add up properly.

  36. I was always shooting for 10M (inflation-adjusted) as a teen because my family would go to Carmel, CA, and I’d see all these beautiful homes close to the beach for 3-4M. 10M seemed like a nice round number to be able to afford one of those homes and be considered rich.
    Do you think that achieving an ideal $200,000 income is more important than achieving a net worth that can generate $200,000 passively (8-10M)? Because the net worth goal would require a lot more work and stress.
    As a point of reference, I’m 21 and currently have a gross income a little over $70k.

    1. I use nice homes to motivate me all the time as well!

      You’ve first got to shoot for the $200,000 before you can get to the $8-10M most likely. Hence, once you get to the $200K, observe your own fillings about how whether it is all worth it and then go from there.

      1. Definitely shoot for the 200k, but don’t decide that income is a must before you build the Net worth. I still don’t make 200k, but can say it is possible to push the Net worth numbers up close to the goals Sam laid out.

        It takes planning, smart investing, some luck, and keeping an eye on your long term goals, but it can be done.

        Obviously it is harder in higher cost parts of the country, so expenses verse earnings is going to play a big part.


    2. Jacob Schwing

      Brett, what industry do you work in to make $70K a year? I’m 19 now, and I’d love to make that much by the time I am 21.

  37. Gosh….you 1%’s you. I have much less than the numbers discussed here, and still feel rich given where I’ve come from. Everyone here is talking multi-millions, never mind 1 million, which is a loooot of money for a loooooot of people. if you have 35 times your expenses invested and working for you, you are rich no matter what your ‘number’. That’s my theory. I only thing I am still figuring out is if the 35x is enough to cover college expenses and some inheritance to kids, or is it just retirement.

  38. I like the way you are trying to interpret the meaning of the top 1% by age and by income, very fancy. I think it’s more simple than that. Wikipedia defines a High Net-worth Individual as a person (not household) with at least $1 million in liquid assets (excluding the primary residence). In the same page Wikipedia states that there are 3.44 million individuals in the US that meet this criteria (2012 data). It turns out that 3.44 million is about 1% of the total US population. In summary, if you have more than $1 million in liquid Net Worth you are in the top 1% in the US regardless of age or income. I’m 47 with $1.5 million liquid and $330K income and certainly feel rich since I only spend about $36K per year.

    1. Ah, but who writes the Wikipedia data?

      $1.5 million seems low, and it doesn’t account for by age. Age is the relative factor here. So for you, the target for a 47 year old would be closer to $4 million.

      And then there’s the savings and interest rate factors in the next chart.

      But if you feel rich, that’s all that matters! Have you considered doing something differently given your spend? What are the reasons why you spend only $36K per year?

        1. 126mm households in the us / 4.4mm millionaries makes one in 29 families a millionaries it’s amazing that it takes 1mm to get to a 3.4%er and 7.4mm to get to the 1%er. The wealth is really held by few

  39. I think incorporating age makes a lot of sense. I agree that it’s really unlikely that someone younger than 25-year-old is going to have accumulated 380k. I sure was nowhere close to that and I don’t know anyone who is or was at that age either. Really good tables!

  40. Is the NW per individual or per household? If it’s per individual, a couple with at age 40 must have 4.6M NW. So I have to change my target to hit 18mm by age 65 or maybe even more provided the inflation for the next 25 years.

  41. No Nonsense Landlord

    I am not in the 1% class, but close. Even if you have $2-3M, it doesn’t seem like all that much. 30 years of retirement can burn up a lot of money. If the market goes south, or inflation goes north, you are screwed.

  42. We are both retired, and our income is from passive income (rental and dividends) Also our net worth is higher base on you chart compare to our age, however, we don’t feel that we belong to 1%.

  43. Sam, I disagree that net worth is more important than income. You qualify for loans based on income, so in a lot of cases you can have a much nicer lifestyle if you have a high income and can qualify for bigger loans. For instance, my husband and I have over 1 million in investable assets, but just have barely above average incomes. In our city, a nice house in a very good neighborhood is *at least* 1.5 million but probably closer to 2 million. We are not able to responsibly achieve this based on our income. Maybe we are too conservative. Our friends with higher incomes seem to be able to easily afford these homes. I’m getting tired of having money in the bank and not spending it, and feeling like I constantly need to save more! Maybe it’s just time to move out of California!

    1. Mina, I think we might be talking different wealth spectrums here.

      Thinking you need a high income in order to take on debt to buy a nice home isn’t a top 1% rich mindset. That’s a middle class / upper middle class mindset. Nothing wrong with that, and I’m part of this class.

      This post is a discussion about the top 1% in terms of net worth. These folks just pay CASH.

  44. I once thought I’d be happy at $2M liquid NW. We hit that number in our early 30s, and I wasn’t happy. I thought “When we hit $4M liquid NW, we’ll have it made”. Now in our late 30s we’ve hit $4M, and I don’t feel like we’ve got it made. My vote is for $10M. But I’m sure when we hit $10M, that number will go to $20M.

    Of course, at our current level, we are not concerned in any way about money. The bills are paid with a fraction of our income, and the rest goes to savings. Worrying about repaying student loans has given way to worrying about wash sales caused by our robo-advisors. I consider us “upper middle-class”, but no doubt others would consider us rich. And I know some who are better off than we, whom I would consider rich, but who likewise consider themselves to be “upper middle-class”.

    In my opinion “Rich” does not vary by age. Rich is the number at which you can live without worrying about working for money, so you have to assume you are living off earnings without touching principle. Liquid NW by age is a good measure of where you are on the path to “rich”. I’d consider the numbers you show to be an indicator of affluence, with the endpoint being “rich”.

      1. You mis read his post: “student loans has given way to worrying about wash sales caused by our robo-advisors”

    1. What you have learned for yourself is that money doesn’t buy happiness! Sure it’s a cliche, but certainly true. We’re 31, nowhere near the 1% income but fairly close to the net worth level in the charts above for our age, and we also have no real worries about money. Having income well above expenses means that even high-spending months are positive months on the net worth front.

      What we have found is that the best way to spend our money to bring us actual happiness (joy, really) is to give it away. That, and to find other like-minded people (or nurture those with the means until they too catch the vision) and combine our resources and our networks to truly make a difference for causes we care about. Helping people out of our abundance has become one the primary sources of meaning and contentment in our lives.

    2. Erik Warren

      I think for most of us our goals and expectations increase as we exceed our previous goals. When we were 30 we sat down and calculated we would need $3.6M for our nest egg. Once we reached that a decade later we set a goal of $6M and after reaching that, reset our goal to $12M exclusive of our 2 retirement homes. Saying enough is enough can be difficult, especially when your compensation increases dramatically late in your career. Recently after a meeting with our financial advisor, my wife and I made a decision to both retire next year in our early 50’s no matter what our net worth. Our decision is in large part driven by the fact that we’ve seen far too many of our friends and loved ones die or have major health issues in their 60’s or earlier. Life is short and so many of us fall into the trap of chasing the dollar for too long.

    3. Why does everyone keep saying “save money”. How do u save money and get ahead. With banks giving u ..75% yield and the inflation rate of 3% its mathmatically impossible to save and get anywhere.

      1. Kevin Salvo

        Pretty sure by save they mean “not spend on stupid stuff”. So that could easily mean invest

  45. One more comment- I believe the $380K is adjusted gross income (AGI) as reported after IRA contributions and individualized deductions, so one can assume the gross income of the top 1% would be in excess of $500K, so the NW numbers should be taken up accordingly.


    1. It’s better to use the actual reported numbers in the calculation, because deduction amounts are different for everyone. But to your point, if people want to multiply $500K by my multipliers, they are welcome to do so as well.

      To clarify, the income, multiplier, and net worth results by age are all MINIMUMS to get to the 1%.

      1. Note 401K are deducted from AGI pretax i’m in my 50ies and me & my wife did the max 24,500 each plus got matches from our companies things like this and unrealized gains may add to this

  46. Hi Sam,

    I love the post. Very thought provoking.

    A few nit picks….

    If you lived in an $8M house, there is no way you could survive on $95K a year. Just the property taxes alone on the house would be $80K – 160K per year (1-2% of the home value). So you need more income just to stay in the house, much less eat, etc.

    Now on the multipliers by age, I realize you did some “top down” calculations as well as a “bottoms up” analysis, but I’d offer the following: The Millionaire next door mentions the formula for an average accumulator of wealth to be the salary times the age divided by 10, so a 40 year old avg accumulator of wealth would have 4X the salary, a 60 year old would be 6X. Meanwhile a prodigious accumulator of wealth would be twice that. Given that your multiplier numbers seem to be a bit high.

    Interestingly enough, my boss who is Corporate CEO was telling me that he saves 75% of his after tax money, so is planning to have enough passive income to retire. I have no idea what his salary is (anywhere from $700K to $4M a year I guess) so he didn’t give me too many hints, except to say that $16M of net worth isn’t so much and is not considered to be “rich”. Based on his experience working with people in California, he believes that over $30M USD is considered to be rich and is quite achievable for someone later in their career. He is in his early 60’s and has been in top leadership roles for the past 30 years.

    Therefore I now believe that his NW is around $20M and probably earns a 1/10th of that each year, as an educated guess.

    For me at 41, I fit the definition of the 1%er of a 45 year old in your chart (similar income levels at about $380K a year), but I don’t think I’m in the top 1%, but more like the top 5%. Not that it matters, not at all. It’s a race against yourself in the long run, and you can’t take it with you.

    If I want to emulate my boss, I realize I can also be worth $20M after many more years of work. However in addition to opening my eyes that I can set my targets much higher than where I am today, it told me that there is never a feeling of being fully content as long as you keep looking to those higher than you. In the end it comes down to the level of balance that is good for each of us.


    1. Thanks for your thoughts Mike.

      You don’t think the <$96,000 a year family of four can afford to pay property taxes on a $8,000,000 mansion with their $10 million in cash in the bank? They've got another $3 million in growth stocks. Surely, paying $100,000 a year in property taxes isn't too hard for this couple. The Millionaire Next Door I think is very light in their calculations, because they use $1 million as the benchmark to be considered a millionaire. I believe $3 million is the new $1 million thanks to inflation.

  47. Love this post and gives us a new number to shoot for. Question: especially for those on the younger end of the spectrum who may have only a small number of years at those income levels — should we use most recent year’s income, or some trailing average (last 3 years?) to compute target net worth? Or just straight up using highest year’s or most recent year’s? I’m all for strwtch goals but curious how you’re thinking about it.

    1. Few people will be in the top 1% right out of school, so it’s unlikely that you’ll be hitting these numbers right away. But if by some stroke of luck you are, then presumably you should have no problem saving enough to be at those levels.

      We are comfortably inside the 1% income range with a mid 6-figure income now, but it wasn’t until age 30 that we caught up with the numbers Sam shows here. That’s because when we started out our income was a combined ~$120K.

      I think using Sam’s charts is interesting for comparing oneself to others, but I’d strongly recommend:
      1. Setting your own goals based on your anticipated lifestyle
      2. Tracking your NW monthly in a spreadsheet (using a website like personal capital IS NOT AN ALTERNATIVE TO THE SPREADSHEET!!)

      When we first started on our journey in the late 90s, I figured we’d want an income of $100K/year in retirement, inflation adjusted. That meant liquid NW of $2.5M, if following the 4% guideline. So my spreadsheet started with $2.5M as the goal, and I adjust it upward 4% per year to account for inflation. I can track on a monthly basis for the last 17 years how our liquid NW is relative to that goal. Now the number has grown to $4.5M, and we’ll probably finally catch it later this year.

      1. I said “younger” but I’m early/mid 30s (I like to still think of mid 30s as young, hah!). Last year was my first year at $380k+ income levels and it appears that I will remain there for some time. My income has increased steadily since college but much more dramatically in the last 4 years as I moved into leadership roles. The reason I asked about how to calculate the multiple was specific to the situation where one’s income has increased quickly, recently. 3-5 years ago my income was much less than the 380k mark. I’m at ~1.2M net worth currently and a nice multiple of my average income over the last 3-5 years. However, using my highest income year is a new goal for me to shoot for since I’m not yet at 4x that level.

  48. If my primary residence is a rental (ie. no mortgage), how does this factor into my net worth calculation?

  49. Interestingly, I surpassed $380,000 in net worth at age 25 and I will also surpass $760,000 in net worth before age 30 (probably at age 27-28), despite never having over $200,000 in income. I have lived off of 30% of the gross income I’ve made since college though and graduated with assets instead of student loans, which was a great kickstarter.

    I would say that for my age, I am definitely rich. I agree with you that the figure depends on age.

    I also think that the figure can depend on gender too as most women tend to make much less money than men. I took a quick look at that census data spreadsheet you pointed at and for male householders under 35, the mean net worth is $208K, but it’s only $120K for female householders under 35. Interestingly, it takes until age 65 for female householders to have a higher net worth than male householders of the same age. My guess is that there are more widows than widowers and the widows inherited their husband’s net worth.

    1. Nice job Leigh. Can you share with us other details that allowed you to get to $380,000 by age 25? i.e. how much was rent, how long did you work and save until $380K+ etc.

      1. It took four years of working post-college as an engineer to hit $380k in net worth. In that time period, I grossed about $630k in W-2 income, spent about $220k ($90k of which was on housing), paid about $150k in taxes, and saw about $100k in misc income (investment gains, interest, employer 401(k) matching, credit card dividends, income tax returns, selling stuff, employer HSA contributions, and small inheritances). The missing number is my assets when I graduated from college. I bought a condo about 2.5 years post-college, which stabilized my housing costs, though until this year, I have lived by myself in an apartment since graduating from college. I have probably worked on average about 50 hours a week and used all of my PTO.

        1. I became a pharmacist after 7 years after high school. At the age of 25 I had my bachelors and doctorate and also 85k in student loans and 40k owed to my parents. I have held a job since the age of 14 too (or I would have owed much more)!

          I have worked tirelessly (60 hours a week average) for the past 3 years to get out of debt and build my net worth. Just counting myself I am somewhere between 200-250k positive net worth now at age 28. I wish I had chosen to be an finance guy, engineer, or tech guy and just work a ton of OT and save like you have.

            1. 1st year out of school was 155k, 2nd year 167k gross. Both figures do not include investments.

              3rd year now on pace for 175k gross not including investments.

  50. Stealthy1Percenter

    Great post and interesting info. Do you think the net worth goals should change at all depending on how many children one has?

    1. I don’t think it matters as much if you can follow the net worth progression and reach $5.3 million or greater by age 65. That is, unless you have more than four kids, and all the kids don’t become independent after adulthood.

      1. I think it does matter how many kids, unless you are already very wealthy. We recently became pregnant again unexpectedly, and it caused us to reassess all of our financial goals and plans. Now I am even more focused on increasing income and savings rate. We also decided that instead of paying for each child’s college education, we will be giving them each a fixed dollar amount and they can use it how they choose (as long as it’s for education). Also, they will need to go to public school rather than private and we will be moving to a suburb with top schools. The calculations change when you have 3+ kids!

        1. First of all, congrats!

          Do you consider the income and net worth figures in my chart “very wealthy”? If so, then I think normal sized families should get by just fine if they follow the net worth trajectory.

          If the figures in the chart are not considered wealthy, what is your definition of wealthy by net worth and income?

          Going to a good public school sounds good to me. That’s why I did for high school and turned out OK :) So did all of my friends.

          1. I know you do a lot of posts on public schools vs. private schools. But maybe you could also talk about saving for college and how to do it. If you have the money- do you fully fund their education? Do you make them borrow some money? Etc… I know a lot of your readers do have kids. Thanks!

          2. Sam, I don’t consider the net worth figures in your table to be “very wealthy.” If you live in a high COLA, your housing costs and other costs are going to be just manageable. We don’t make that income (380k) so maybe that’s why it seems difficult to make it!

            1. Stealthy1Percenter

              Agree with this here. I did think about this some more and decided that at the end of the day, it is probably a bit difficult to nail down exact numbers with regard to wealth and kids. As all parents probably know, kids can (but don’t have to) cost a decent bit of $$ to raise. Some may have special needs, some parents want to send kids to private school, some parents want to pay for college, etc.

              My personal measure (as an esteemed member of the 380k+ club) is having enough to pay for college for each child. I would probably add at least $100K to the net worth goal for each child one has.

        2. theofficialjohnandre

          At least in NYC, a lot of my friends have moved to either Long Island or New Jersey for the better schools but then they get hit with the insanely high real estate taxes. I might end up “renting” in the suburbs when I have number one, but there is NO way I am retiring there. Some parts of Long Island and New Jersey you can end up paying $12K+ in real estate taxes for a 400K+ home, NOT including the $400 a month in commuting costs…

          1. Thats really not obscenely high. I live in the midwest in a city with a population of about 20,000 and the taxes on my $100k house is about $2,000. So for a $400k one, it would be about $8,000. Considering how much more things cost over there, I would have thought it would have been even more.

            1. Matt: Anyone who pays $1,000/month (and more) in property tax on a $400,000 home never truly own’s his own home.

              Furthermore, theofficialjohnandre is paying 3 times the amount of property tax per month for a home which is only 4 times as valuable as yours.

              Using your home as the standard, in order for you to pay the equivalent amount in property tax on a monthly basis as theofficialjohnandre you’d have to own a $600,000 home, e.g., your home would be 1 1/2 times more valuable/expensive than the originaljohnandre’s $400,000 home.

              Living in a high cost, i.e., high tax, area chews through one’s discretionary income at a much faster rate than that of a person living in a low cost state.

              I live in SoCal and plan to retire to Montana, which, although not a “tax friendly state,” is a much less expensive location in which to live in comparison to California.

            2. Said this: Furthermore, theofficialjohnandre is paying 3 times the amount of property tax per month for a home which is only 4 times as valuable as yours.

              I should have said this: Furthermore, theofficialjohnandre is paying 6 times the amount of property tax per month for a home which is only 4 times as valuable as yours.

      2. I also had the same Q. Is this analysis for an adult/couple, or one with kids? Because with kids, the math does not add up, even for a parent who makes $200K p.a.

        A couple with 2 kids. Total Gross, $380K. 28% tax, lets say = $106K. Left $273K. $36K for both in 401K. Left $237K. HSA max ($6550), State Tax (5% = $19K). Left $211K. Property Tax, Car Registration Tax = $6K, lets say. Left $205K.

        So, after maxing out 401Ks, paying taxes, one is left with $205K. Kids’ expense has not entered yet (except for exemptions), but I chose 28% bracket still.

        Fixed Expenses (Cell Phone, Cable, Utilities – Water, Electricity, Trash, HOA) Home Maintenance) = say, $1250 per month. $15K, lets say.

        Left with $190K.

        Variable Expenses, now this varies heavily with kids, or not. I would add at least $500 for an Elementary/Middle school for each kid. So, if a couple spends $4K pm, with 2 kids, their monthly expense even with public school is about $5K pm. $60K.

        Left with $130K to save.

        Mortgage Payments, $3K pm. $36K. Left with $94K to save.

        $94KK saved for 5 years, $650K, with a growth rate of 2.5% = $506K

        Your 40 to 45 shows, an increase in net worth of 1.1M, almost double.

        Unless we are in a bull market, and real estate is going up like crazy as in SFO.



        1. A few edit:

          1. I did not include $36K added to 401K to increment in net worth, but then I also did not into the details of Health Insurance, Dental, FSA etc. deducted from Paycheck.

          2. Bottomline was – that a 1% earner of $380K is left with about $100K to save. Given the geographic variation in salary, and expenses. This was to bring out the middle ground.

          3. $100K saved each year, with 2.5% growth (again this varies on when you were born, someone turning 35 from 2000-2001, or 2007-2008, may not agree with this, but lets keep 2.5% growth as an average), will result in $540K net worth growth over a 5 year period. Not in millions.

          4. Of course one is not starting with 100K at 40, to have an increase of $540K, but if you had $2M to begin with, the NW increase will be higher. So, the key becomes to have a NW as early as possible when you don’t have kids, or else the “chain” over time, falls apart.

          5. I also think that folks between 50-55 can NEVER have this kind of savings, as they pull out from their savings to pay for their kids private HS, or College. It works faster to negate NW, than after retirement.


          1. You can never make it into the top 1% wealth growing at 2.5%, need 12% at minimum, usually much more. You don’t make it into the top 1% wealth buying stocks or stabilized real estate.

            1. Mercury has it half right. you need to save 15% or more of income. however, the stock market blue chips have been very good to us since 1982 when we began investing with a household income of $25k. only once or twice have I hit anywherer near the 380k described but by constantly living within a budgeted income of 100k (far below means), and investing the difference in blue chips, we are approaching the 1% net worth level at age 56 and have ALWAYS given at least 10% of gross income to charity. I would challenge any reader to focus on the line between wants and needs and drive it toward needs.

            2. To be clear though, the markets were growing at ~12% annualized from 1982. If you have ever looked at those charts which show returns based upon years, 1982 was literally the best year to start investing in equities. This was a rare time when the avg buy-and-hold investor outdid just about any long-term hedge fund over the past decade.

              I agree you need to save at a very high level, probably much more than just 15% of income today, but you still need to find a way to grow it at 10-12% if you want to stay in the top 1%, in the long-run.

      3. Sam,
        I recalled somewhere in your postings (I couldn’t find it again) that you managed to double your net worth from $5M to $10M from 2002 to 2016. Congrats on that. I am much older middle-age person and my full-time job income has never exceeded $150K per year for the last 12 years. I am a Federal government working stiff currently and I have used an active options investing strategy and managed to more than triple my taxable portfolio before tax from 2002 to 2016. Since it is an active strategy, it takes work to produce capital gain and income. I have only worked for the government for the seven years and I am not old enough to retire from the government as yet even though I really much wanted to in order to focus on my investment strategy and work full time.

        My plan is to generate $0.5M annual investment income in the next a couple of years and $1M in the next five years. If I can achieve those annual milestones, perhaps I can ditch my full-time job that I don’t like.

        Besides my options investment strategy, I really enjoy and appreciate your idea about starting a blog to generate additional income. Like what I said, my job income is pretty low, and yet my total net worth (active portfolio plus passive 401K and IRA) is about $3M. My goal is to attain $10M and I believe with my active investment strategy will get me there. So I therefore wonder if your could share with me your thoughts on starting a blog regarding the journey of how a government working stiff on his way to achieve top 1% status.

        Many thanks in advance.

        1. Hi KKL,

          Nice to hear from you. I don’t think I’ve ever written a post about getting to $10M net worth. The only post I’ve written regarding my personal net worth is: The First Million Might Be The Easiest.

          But regardless, I think starting a blog about how a gov’t worker reached the top 1% would be a great read! Further, you guys have this great pension that pays for life. Check out: How To Start An Amazing Blog and Blogging For A Living: How Much Can You Really Make?

  51. I’d be happy with 2-3 million. It would let me retire around 55 and not worry about the future. I chose a profession that doesn’t pay extremely well, and, while I do enjoy it, in hindsight, might have chosen a different field. Still maxing out 401k and saving about 38% of income beyond that.

    My greatest concern as a Gen-Xer is that the federal government will change regulations and tax Roths on withdrawal, and up the taxes on 401k withdrawal.

    1. Given that many studies show Americans go in and out of salary ranges, with many in the top 1% for a year or so then they drop off, the net worth numbers don’t seem to make sense, even if the salary does.

      Do you have to average the 380k salary for the full time period to get the net worth? So if you hit the $380 for years 60-65, but have a career with an entry level job from 20-25, then a break from school, then a steady progression until 60 when you have a “breakout year” what should you have saved? Given the 4% rule, wouldn’t $5M be rich by anyone’s standard? Isn’t 2.5% artificially low? (Note the fed states it is in a mood to raise rates)

      1. I agree, there big salary comes usually in the mid to late 40s. One usually makes just below and just above 100K for a large portion of their career.

    2. Marvin McConoughey

      $2-3 million……………….. That seems enough to me, also, to feel rich. Assumptions included are no more than two-person family, no unusual outside expenses such as alimony, extreme illness, etc, and not living in a very high cost area. Age also matters. Having only days or weeks left to live renders financial wealth unimportant other than attending to the needs of the moment.Ma

      1. hello sir. wow why you feel the way? because 3m net worth its alot of money, im 18 and my net worth is between 20.000 and 30.000 :(

        1. Paul L Alldredge

          Make a concerted effort to put at least 15% of your gross pay into a traditional or Roth IRA. You have the compounding of your money over time in your favor. Also, don’t be afraid of equities. Equities at your age are your friend and index funds like the S&P 500 and total stock market index funds feature low costs and maximum returns over time.

        2. Early 40’s, female, income has mainly been from real estate and tech. Started with nothing and built to more than $250m and still live simply :) I love Costco, lol…

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