Do you ever wonder what others are doing with their finances and where they stand? My usual, rather pessimistic, thought is that I’m not doing nearly as well as my peers.
I came across this calculator on CNN Money that gave a median net worth comparison for income and age. My income is pretty low at $24,000 and I entered this amount and my age – 60 and this was the result.
My net worth is in the $700,000 range, but before I start congratulating myself I realize that this compares the net worth of US residents. Canadians must be better savers. After all, I always read about Boomers with $5-million residences and portfolios in the seven figures, so now I feel I’m falling extremely short.
I found another net worth comparison calculator from the Royal Bank that give me this result:
We all like to compare ourselves to what others are doing, especially in financial matters, where our conversations are vague and we always want to sound smart and on top of our money.
We’re curious about what the benchmark – or median – is. But, really, these types of calculators and comparisons are useless because there is no other context. Everyone is different and has different circumstances.
Assets only have the value that you give to them. Some people might be thrilled to have the above-mentioned $180,000. Then there are others that worry themselves sick because they don’t think several million dollars is enough.
Having a comfortable life has less to do with how much wealth you have stored up and more to do with your state of mind. How much do you need to maintain a comfortable lifestyle? The “magic number” is going to be different for everyone depending on chosen lifestyle, spending, and priorities.
You only get meaningful data by calculating your own net worth at least annually, and comparing the results with your previous information. Your annual review can help you measure the progress of your financial plan. It helps to keep you on track and stay focused on achieving your own vision. You then have a choice of whether you’re willing to make any necessary changes.
What do you think of these net worth comparison calculators?