Have you ever wondered what the average net worth is of your peers? It's probably impossible to know for sure unless they show you a spreadsheet and tell you.
However, it's possible to make an estimate based on their income, age, real assets, and spending habits. People always say that you're the average of five peers. So it might be good to do some calculations to see if the theory holds true.
I've put together a list of five of my own friends and acquaintances. Their respective net worths are rough estimates based on what I know about their visible assets and how long they've worked.
See how they compare to the median 2023 net worth of all US households at around $193,000 based on a Federal Reserve survey. The average American net worth is now over $1 million.
Why such a big difference between the median vs average? The average net worth is calculated by adding up the net worths of all American households and then dividing by the number of households. The median net worth is calculated by finding the middle net worth of all net worths in a dataset. Thus, the average calculation comes out higher because of the top 10% wealthiest American households (net worths of ~$6.6+ million).
Average Net Worth Of Your Peers
Now let's look at 5 profiles of my peers. Names have been changed for privacy.
- Nancy. Age: 40. Job: Investment banker. House value: $3 million. Equity: $1.5 million. Income: $800,000. Savings: $800,000. Two cars: $60,000. Other assets: $1 million. Estimated net worth: $3.5 million. Nancy is a friend I've known for 10 years. She has three kids in private school and therefore has a high operating nut.
- Lyndon. Age: 34. Job: Strategy consultant. House value: rents. Savings: $400,000. Assets: $600,000. Income: $300,000. Estimated net worth: $1,000,000. Lyndon is a buddy I've known since New York City in 1999. He wants to leave his job and be a photographer.
- Greg. Age 34. Job: Unemployed. House value: $1 million. Equity: $400,000. Savings: $1 million. Estimated net worth: $1.4 million. Greg is taking time off after cashing out from his tech firm.
- Linda. Age 32. Job: Sales manager. Income: $120,000. Rents. Savings: $230,000. Small Business: $200,000. Estimated net worth $430,000. Linda is a fellow San Franciscan who is looking to do something new before age 35.
- Peter. Age 33. Job: Construction engineer. House value: $250,000. Equity: -$100,000. Savings: $150,000. Estimated net worth: $100,000. Peter is my tennis buddy who enjoys dating online.
After adding up all five net worth figures and dividing by 5, I get: $1,286,000.
Average Net Worth Of Your Peers Part II
Here are 5 additional profiles of my aquantainces. Names have been changed for privacy.
- Casey. Age 48. Job: Fund manager. House value: $7,000,000. Equity: $5,000,000. Savings: $5,000,000. Vacation house equity: $5,000,000. Other assets: $10,000,000. Estimated net worth: $25,000,000.
- Mustafa. Age 35. Job: Blogger. House value: rents. Operating Income: $70,000. Rental house value: $250,000. Equity: $50,000. Assets: $250,000. Estimated Net worth: $300,000.
- Gus. Age 34. Job: MBA student. Rents. Savings: $15,000. Assets: $20,000. Car: $30,000. Debt: $15,000. Estimated net worth: $50,000. Gustavo is another tennis friend of mine.
- Jim. Age 40. Job: Finance. House price: $700,000. Home equity: $0. Savings: $150,000. Assets: $300,000. Car: $50,000. Zero debt. Income: $250,000. Estimated net worth: $600,000. Estimated net worth with inheritance: $2 million.
- Tiffany. Age 27. Job: Personal trainer. Rents. Assets: $8,000. Car: $6,000. Student Loans: $30,000. Estimated net worth: $-15,000.
The average net worth of these five acquaintances is around $5 million dollars. The net worth average is obviously skewed by my Casey. If we take out Casey, the average net worth is $230,000.
Average Net Worth Of Your Peers Conclusion
Net worth is a function of age, income, occupation, luck, and savings rates. Most of my closest friends are in their 30s. A couple of them plan to retire or do something else shortly, leading to a decline in their respective incomes. That said, I suspect all their net worths will continue to increase due to their good savings and spending habits.
I've got poor friends and I've got rich friends. Tennis and other common interests are what keeps us together. The level of wealth just so happens to be of something fun and interesting to discover. Net worth doesn't matter between friends. Based on the following examples, the average net worth of my peers is not statistically close to my own.
Related: The Average Net Worth For Canadians Is Huge
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Great post! I just realized I hit the $300k mark this week. It feels good to have come so far! Yet the whole $2M goal still seems impossible. It’s good to read about different people who have varying levels of networth and are still doing well enough. :)
Here are the stats on a very close friend:
Age: 50
Annual Salary: $70K
House Value: $120K
House Equity: $120K
IRA: $400K
non-IRA: $360K
Student Loan: $20K
Net Worth = $860K
The Financial Samurai is so out of touch with reality – not too many 30 or 40-somethings have hundreds of thousands in savings
Are you saying all the people I know are mirages?
Since I’ve been told children are priceless, doesn’t that mean women like the octo-mom have the highest net worth?
Indeed. However, the government is trying to scare the public out of having children. https://yakezie.com/201951/personal-finance/cost-of-raising-kids-children-cheaper-than-you-thin/
I think the net worth assessment is flawed in many ways and probably the best measure is actually income, not net worth. Many people with similar incomes run in the same circles, but their net worths can differ dramatically. I know people who make plenty and have horrible financial management skills and have negative net worth. Conversely, you never know (people often don’t broadcast it) when someone has a substantial net worth from an inheritance or just general frugal savings habits. Aside from that, it depends completely on which 5 you pick. Of the ones you chose to assess, the standard deviation is enormous!
True indeed. A fun exercise nonetheless thought up while I was taking a shower. Choose your closest friends or peers!
I am in IT, but I also have businesses. So, I have few close friends in IT and few in hotel business. I don’t know if I can guesstimate their assets, but business owners do seem to have lot more asset( average $2 million + networth) whereas IT workers(my friends) may have asset in $300-$500K range.
so, according to this post, if i have a better grade (richer) friends (peers) i can up my net worth. also, if i own a home rather than rent, i’d be well off much more.
geeze, i think you are absolutely brilliant.
not.
want to know the net worth of your ‘friends’? you can look it up on the internet, do a zillow on their property, check out the property tax records, etc. etc. that’s how i know my so-called “rich” friends, the ones who jet set off to the carribbean often, own vacation homes in Wyoming or Miami, eat out at fancy gourmet restaurants, drive fancy BMW or VW cars, and YES even play tennis, are really broke. Some of them even have tax liens on their properties. And are in credit card debt up to their eye balls.
i’d like to know how you found out all this information about your peers and associates?
How’d you find this post to begin with?
Sounds like something bad financially has happened to you and I’m sorry. Hope you can get out of your funk.
Re-read the post to learn how I got this info.
What really surprises me is that your friends either tell you or let you approximate (by guessing) their savings. You have to have a pretty good picture of their saving habits + spending to guess what they have. My friends NEVER tell me how much they have (or not.) So this exercise would not work for me. I can guess but guessing something that I don’t even know approximately won’t result in anything. :)
I’ve know these friends for a very long time. One mentioned his entire savings, income and operating expenses he has to pay. Others are just approximations based on years worked, income, and assets.
As I said in the beginning of the post, one won’t know for sure unless someone says so. Even then, who knows. Just thought this would be a fun exercise. You’ll find a lot of net worth posts online in the blogosphere.
Not sure if the net worth relevancy really counts or is statistically significant for those who haven’t worked for several years. Can be all over the map due to other reasons.
Here’s mine which reflects the reality of most Americans: Age 35. Income $39,000. Home Value $95,000. Equity $8k. Car value $3000. Savings $500. 401k $9000. Student loan debt $19,000. Credit card debt $2500. Credit score 790.
I think its difficult for me to even try to guess what my peers’ net worths are. I try to just focus on my own finances. I find that is hard enough!
I couldn’t even begin to guess what my friends have in the bank. I know some of their 401(k) information because I helped them looking over the funds, but that gave no insight to what is sitting in the bank.
This is a cool post Sam. I don’t know the specifics of my friends net worth but I think I fall above average since several of them are in grad school, earning a teachers salary, or stay at home moms with similar housing situations. Even though I don’t feel the need to know the details of their finances I do wish they liked to talk about personal finance. I love discussing ways to save money and investment opportunities.
I’m not really sure of my friends’ net worth, however the ones that own homes probably have a net worth slightly higher than my own. Though I think I’m much more intune with my finances than most of my friends.
I’m not sure what the net worth of my friends are but I know I’m in the top 10% of my friends. I started working when I graduated, and have been saving and workin since I was in high school.
Unfortunately though for me, this won’t last much longer unless I develop some more sources of income as quite a few of my friends are in medical and law school!
Although I have successful friends around me, I think I match their net worth. I may not earn as much as some of my friends, but I was better at saving and investing. This is only a guess on my part based on trips we take together.
I think it’s an interesting exercise and impossible to know for sure. It’s fun to guess, but you don’t know if they’re sending cash to family members, blowing tons of money on online gaming sites, or saving like mad. Appearances are incredibly deceiving. Also, you can’t believe everything someone says. Rich people “cry poor” and poor folks “live rich.”
Haven’t seen the “crying poor” phrase in a while… might have to adopt it and sing it’s praises.
I have a mix of so many different friends in so many different fields, but I will say this–because I grew up with parents who were terrible with money, I always had a desire NOT to be that way…so once I started working full time I began saving a percentage of my income every week–like clockwork…and this little step has made my net worth more than some of my friends with double the income I have…I sincerely believe that you must have a desire to be financially independent…I am not there, but am on my way. great article, once again.
Joe
It’s great that your parents bad money habits created good money habits! I attest this to your own will, b/c many people say they develop good money habits from their parents good money habits.
“Based on the following examples, the average net worth of my peers is not statistically close to my own.”
Sorry if this was covered in an earlier post (I just found your blog recently, really great work!). Did you write about your current situation in a prior post? I’m going through them all, but you’ve written quite a bit over the years, it’ll take time! (which is fine, I love this stuff!)
Welcome Brian. How did you find my site?
Here’s a post: https://www.financialsamurai.com/2011/11/04/never-tell-anyone-how-much-money-you-make/
And another: https://www.financialsamurai.com/2011/01/24/most-people-make-a-lot-more-money-than-you-think/
No, I don’t think that works for my peers and my friends. I’m kind of a lone wolf when it comes to this – I have side hustles and other factors that come into play that neither my peers nor my friends do.
Are you saying therefore that your net worth is much higher than your peers?
Your peers might surprise you!
My net worth is higher than all of my friends, but that is because I moved out young, bought a house and cars young, and I’ve always had a full-time job. I’m sure eventually they will all catch up though.
Unless you have been very skilled in your car purchases – I do not think purchasing “cars young” has helped increase your net worth. A car is “generally” one of the quickest depreciating things you can purchase.
I’m just saying that I’ve always been more responsible with my money. But yes, our car purchases have always been good investments. One of our cars has tripled in value and one has quadrupled. My car has been pretty steady though.
Nice nice! My cars have all lost money. However, since I bought my first new car over 25 years ago, I have bought a total of 3 news cars – thus I have not lost to much money by buying cars. One was in 1988, one in 1998 and my last was purchased in 2005.
Thanks! Luckily he is good with cars. We have a classic truck that we bought for $4K and now it’s worth nearly $20K! And we bought a Jeep around 3 months ago and now it’s worth a lot more. Thankfully he can fix anything with cars.
Wow, your car gained 5x in value? What is it?
Maybe you can write a post and teach us how because those are amazing returns!
I’m particularly interested in buying a Jeep and tripling the value!
We bought a 1961 Chevy Apache for $4K (got a great deal) and after a little work (very minimal, just flushing fluids, etc.), and now it’s worth a ton more and in perfect condition. And the Jeep we bought for around $2.5K and we recently had someone asking to buy it for around $7.5K. We’ve been thinking about getting into the flipping cars (like houses haha) business!
I really don’t focus on what others have in terms of net worth, but instead focus on my own net worth and getting ahead. There are many variables to a net worth, some are true, others are a little skewed due to certain variables. For example, in your recent article I mentioned that I have a friend who owns a condo like my self, except that his parents donated him $60k for a down-payment. Of course his net worth will be bigger vs. mine, as I only put down 10%, and he put down 20% on our respective condo purchases. So, is that true net worth vs. someone who dropped their down-payment? I think not, its kind of skewed in my opinion.
IMHO how much you put down on the house does not effect your net worth or the net worth comparison of you to your friend.
What does matter is he was given 60K – a lucky man he is!
It might be skewed in your opinion but I still think he gets to claim the 60K in his net worth calculation.
I understand that he gets to claim the 60k in his net worth, but his net worth is heavily influenced by the gift of 60k. If he didn’t receive the money, what would his networth be? I doubt it would be at that.
You are correct – it would be almost exactly 60K less!
Technically the gift counts as part of his net worth!
Life it’s fair and never will be.
Wow, I’d be interested in knowing this but the net worth of our friends isn’t something that we know specifically. I know some have a little money saved, some don’t have any, some have used up their savings so one could stay at home with their kids, others make $100K per year and are in the process of saving. I think we’re probably an average of our friends, especially when I divide our net worth by two to get our individual net worths.
Since I have moved to Florida I haven’t found many close friends. My friends from where I used to live are probably more in line with the average net worth for my age and I think I am slightly above it. I don’t think it matters though. I am not friends with them because of their net worth.