Every year since 2017, Charles Schwab has conducted its Modern Wealth Survey, which asks Americans about both their actual finances and their beliefs about money. In 2024, Americans stated that the average net worth they consider “wealthy” is $2.5 million.
According to recent data from the Federal Reserve, a net worth of at least $3,795,000 places you among the coveted top 5% of U.S. households. While this may seem like a substantial sum, it pales compared to the ultra-affluent's stratospheric wealth.
This year's study reveals that Americans now think it takes an average of $2.5 million to be considered wealthy – which is up slightly from 2023 and 2022 ($2.2 million).
Rich people often focus on earning and spending, while wealthy people emphasize sustainability, growth, and long-term financial security. Understanding this distinction can provide valuable insights into your own financial priorities and help you define clear goals for managing and building your wealth.
Probably 1 in every 20 families have a net worth exceeding $3 Million, but most people's net worth is their homes, cars, boats, and only 10% is in savings, so you would typically have to have a net worth of $30 million, which is 1 in every 1000 families.
Based on that figure, an annual income of $500,000 or more would make you rich. The Economic Policy Institute uses a different baseline to determine who constitutes the top 1% and the top 5%. For 2021, you're in the top 1% if you earn $819,324 or more each year. The top 5% of income earners make $335,891 per year.
Your net worth is what you own minus what you owe. It's the total value of all your assets—including your house, cars, investments and cash—minus your liabilities (things like credit card debt, student loans, and what you still owe on your mortgage).
Regarding net worth, having $1 million in liquid assets often puts you in the 'high net worth' category. But if you want to be considered very high net worth, you might need anywhere from $5 million to $10 million. For those aiming even higher, ultrahigh net worth status could mean having $30 million or more.
Americans say you need a net worth of at least $2.5 million to feel wealthy, according to Charles Schwab's annual Modern Wealth Survey, which surveyed 1,000 Americans ages 21 to 75 in March 2024. That's up slightly from $2.2 million, compared with last year's survey results.
To crack the top 10% of retirees, your net worth needs to hit around $1.9 million, according to Federal Reserve Board survey data. For those aged 65-74, that figure jumps to about $2.63 million; for retirees 75 and older, it climbs even higher to $2.86 million.
Do you include a 401(k) in a net worth calculation? All of your retirement accounts are included as assets in your net worth calculation. That includes 401(k)s, IRAs and taxable savings accounts.
What is a good net worth for my age? People in their 20s and 30s should target net worth of $100,000 to $300,000. A net worth of $1 million or more should be the goal in your 40s and beyond. A seven-figure net worth is usually necessary to ensure a comfortable retirement.
That's not chump change, but it's also not the $5-$10 million range some financial gurus – like Suze Orman – insist you must live comfortably. If you're dreaming of $3 million or more, though, you're officially aiming for a financial VIP club that represents less than 1% of retirees.
"For estate tax purposes all assets should be listed on the net worth statement, including tangible personal property like clothing, jewelry, furniture, cars, collections and art.
According to some experts, the optimal range for home-ownership is between 10% and 30% of your net worth. Rental properties and passive income: Rental properties are another common and attractive form of real estate.
Your home is likely your most valuable asset, and the value that you assign to it will have a great impact on your net worth calculation. A qualified real estate professional can give you an estimate of your home's value, or you can research online real estate aggregators such as Trulia or Zillow.
Key Takeaways. The lower class has a median net worth of about $3,500, while the upper class has one of about $7.81 million. The middle class has a median net worth that ranges from $93,300 to $1.04 million.
Rich people are often measured by their income. Wealthy people, though, are measured by their net worth – how much they own minus how much they owe. A person can earn a huge salary but not wealthy if they have high debt or no savings.
In 2022, the national middle-income range was about $56,600 to $169,800 annually for a household of three. Lower-income households had incomes less than $56,600, and upper-income households had incomes greater than $169,800. (Incomes are calculated in 2022 dollars.)
Most Americans dream of being rich. But how much does it take to be considered wealthy? A net worth of $2.5 million is what Americans think it takes to earn the wealthy moniker, according to Charles Schwab's annual Modern Wealth survey.