in this video we're going to be walking through how much money you should have saved by every decade so whether you're in your 20s 30s 40s or even nearing retirement we'll have those numbers for you as well as the major goals for every decade I will also share with you the median and average net worth for someone your age based on the data that we have from Fidelity EMP power and the Federal Reserve there will also be time stamps and chapter markers so if you just want to skip around to the decade that applies to you the most you can do so all right so let's get started with the decade of the 20s so in your 20s you're likely graduating School you still have a a lot of student debt and therefore your savings as well as your media net worth aren't going to be at its highest point in your life in fact it'll probably be the lowest it will ever be and a lot of people in their 20s will have a negative net worth as they try to climb out of the student debt balance that they might have the median net worth of someone in their 20s is $6,998 so remember guys the median value in this case is going to be the exact middle point of all the net wors for this age decade range so if you took all of them and you arranged them in order this would be the middle value there's going to be some outliers at either end so there's going to be some people that have a ton of money in the age of their 20s and some that have a huge negative net worth but the idea is that half the population will have less than the median and half the population will have more than the median and when it comes to figuring out what your net worth should be by age I think we should stick to the median because that's a better representation than what the average net worth is because the average net worth is going to be heavily influenced by those with really high net worths at the top of the spectrum as you can see the average net worth is 99,000 $272 for someone in their 20s according to empower and that's really high when you compare it to the median and probably unrealistic in terms of savings the target number that you should have saved by the end of your 20s so when you hit the age of 30 is 1x your salary for retirement Fidelity recommends this number in order to stay on track for retirement by the age of 67 so let's say at the age of 29 or 30 you're making $75,000 a year that means you should have at least $75,000 saved in all of your accounts so that includes your retirement account your brokage accounts and also your savings accounts if you are looking to retire earlier than the age of 67 then you want to check out my video on the channel I have an exact dedicated video on how to figure that out because the math will change considerably in terms of goals to hit in your 20s I think there are four big ones so the first one is going to be no Consumer Debt and this is one that I harp on a lot but if you have any High interest rate debt or credit card debt you want to kill that off immediately and the reason is simple it really slows down your wealth compounding so anytime you do have that you want to get it rid of it as quickly as possible but I think student loans are still okay to have especially in your 20s because it's usually a large balance and the interest rate is a lot lower the second goal to hit in your 20s is to understand your spending so by knowing how much money is coming in versus going out on any given month you're going to be ahead of most of the people in their 20s because you're going to have more of a picture of your finances than other people the third goal is to have a plan to make more income eventually especially in your 30s and your 40s now in your 20s it's not imperative that you are raking it in but I think it is important that you are experimenting with a lot of different things if you're able to find a role a skill or a career that you particularly enjoy then by the time you're in your 30s and your 40s and you've honed in on that skill you could be making a lot more money than on and finally the last goal in your 20s is to start investing and good investing starts with a good solid Financial foundation so make sure you have at least an emergency fund stocked with 3 to 6 months of living expenses after you have that filled up I'd probably start looking at investing through tax advantaged accounts like your 401k your IRA or the Roth IRA in my opinion if you're in your decade of the 20s and you have no debt as well as some savings and you're going to be ahead of most people at this age bracket now if you do have a media net worth higher than $6,998 then you're going to be doing much better than at least half the population that brings me to the decade of the 30s now in your 30s you're likely hitting your stride when it comes to your career you might be starting a family you might be getting married soon and therefore you have a lot of big expenses coming up such as paying for that said wedding buying a house or even you know buying your favorite Charizard card that's a PSA 10 and costs over 250 Grand all kidding aside though the media Network of someone in their 30s is $346 and if you watched my old video from 2021 on this exact topic you'll know that that's a lot higher than the 2021 video and that's because the media net worth has really increased in the last few years so according to the Federal Reserve survey of consumer finances quote between 2019 and 2022 real Media Net worth surged 37% and real mean net worth increased 23% indeed the 2019 to 2022 growth in Media Net worth was the largest threeyear increase over the history of the modern SCF more than double the next largest one on record now a huge reason why net worth has really skyrocketed the past few years is due to asset prices so from 2019 to 2022 as you may or may not know the stock market has been absolutely ripping as well as the fact that home prices these days are 25% higher than they used to be back in 2019 we also have more dollar circulating in the economy due to all the money that was printed during the pandemic and so therefore we have more dollars chasing the same amount of goods AKA and inflation so asset prices are going up it's important to note that if you don't have the media net worth of$ 34691 or you're still in debt in your 30s it's not time to panic in your 30s it's still early enough where that if you start taking actionable steps today to crush that debt or to start saving more that you could be well beyond the median net worth as well as the average savings rate for most people by the time you're 65 the goal of today's video is to show you how most people are doing in the United States and if you aren't there financially just yet I'm glad you found this video and we are going to teach you those steps in order to get you there and Beyond in this video and in future videos on this channel so the amount that you should have saved by the end of your 30s AKA when you hit the age of 40 is going to be 3x your salary Sav for retirement now according to the Bureau of Labor Statistics the average annual income of someone by the age of 40 in the United States is $62,000 that means by the age of 40 you should have three times that saved in retirement accounts tax brokerage accounts savings accounts Etc so 3 * $62,000 is $186,000 by by doing so and using a retirement calculator from NerdWallet here we can assume with Investments that you should be able to get to $211 Million by the time you're the age of 67 which is pretty darn good in my opinion I think there are a few goals in your 30s that you should be really hitting number one you should be systematically saving and investing 15 to 20% of your gross income and if you're able to do this then the math really just shows you how powerful this is let's say you could only saved 5% of a $60,000 salary so $3,000 a year into the S&P 500 even at $3,000 a year if you get the average returns of the S&P 500 at 8% by the time you're age 65 you're still going to end up with a balance of over $600,000 now here's a spoiler but the median net worth of someone in their 60s is $454,000 in America so literally if you start at the age of 30 and you invest $250 a month into the market which is $3,000 a year you could be well over the media net worth by the time you're in your 60s goal number two in your 30s is to be completely out of debt excluding your mortgage of course by the time you're age 40 the idea here is that in your 30s these are your Prime earning years so you really want to start ramping up that net worth and the way that you do that is you keep your lifestyle the exact same while your income goes up and therefore you're going to have more money every single paycheck to invest and also pay off debt the last thing you want in your 30s is to have so many existing credit card payments or buy now pay later payments or any High interest rate payments that are slowing down your wealth building goal number three in your 30s since you're going to be making more money you probably have more obligations as well but you want to avoid spending too much money via lifestyle inflation one of the most famous quotes in the book Millionaire Next Door is the following so quote great offense and poor defense translate into the under accumulation of wealth and the foundation stone of wealth accumulation is defense and this defense should be anchored by budgeting and planning so what he's saying here is that even if you have a strong offense AKA you're making a lot of money if you have a poor defense you are going to be an under accumulator of wealth so defense in this case means spending reasonably and so if you have that good defense set up then you're going to be just fine goal number four in your 30s is to test your reaction time to see how fast you can subscribe to this channel so I just did it myself and it took me less than 0.1 seconds okay now that you've done that let's talk about the age of the 40s so the average net worth of someone in their 40s now this is average again is starting to get pretty crazy it's $73,700 is you're going to have those people that are really making a crap ton of money especially at the higher end of the spectrum so they are really skewing this average all the way up but we should still be focused on the median net worth at this age and the media net worth of someone in their 40s is $126,800 your 30s right now you should be able to blow way past this median net worth number especially if you start right now for example if you start investing $5,000 per year at the age of 25 by the time you are age 40 so you're not even in the 40s just yet you are just age 40 your investment will be $162,000 which is more than the the median net worth Fidelity recommends that in your 40s before you hit the age of 50 you should have at least six times your salary Sav for retirement now 6xe salary save for retirement is double that of what the previous requirement was at the end of your 30s and so you can see that as we move up in age your savings targets will also move up and up and up in your 40s I think there should be a few goals that you should be targeting so the first one is that you should have your retirement number in mind you're probably more than two decades away from retirement at this point but the idea is still that you should be able to figure out how much you need to live off in your retirement and then therefore work backwards to figure out what retirement number you need to get to by the time you are age 65 or 67 A good rule of thumb is that you want to try to live off of 3 to 4% of your investable assets every single year in retirement so I always like to use the $1 million Benchmark here as an example so if you have a million dollar invested and you withdraw 4% per year that means you're able to withdraw $40,000 per year in retirement the idea here is that 4% or $40,000 per year is a reasonable amount to withdraw because your Investments are hopefully gaining you at least 8 to 10% on average every single year so that means you're at least earning more than you are actually spending goal number two in your 40s is to have all of your big expenses accounted for so if that means paying off your house or saving for a college fund you should know exactly what those big expenses are and you should have a plan and priorities for all of those goal number three in your 40s at this point I think you should have all of your financial bases under control as well so that means you should have an excellent credit score an estate plan if you think you need it $0 in debt except maybe a mortgage and a plan for the next 20 years moving forward all right let's talk about the age of the 50s now so when you're in your 50s the average and Media Net worths really start to get crazy the media net worth of someone who is in their 50s is $292,800 so the end of your 50s is 8x your salary saved for retirement so if you know you've been making $60,000 a year for your entire life for example if you hit the age of 60 then you want to have 8X saved so that's $4 $80,000 personally I think that's a healthy number to Aspire to and 8x your salary save by the time you are in your 60s is going to be a somewhat reasonable number now 177% of you guys watching are between the age of 45 and 65 so if that is or that happens to be you please let me know down in the comments how much you have saved and if you think this is reasonable I think there are three big goals here to accomplish in your 50s so number one if you have a mortgage it's likely that your 30-year mortgage is coming up soon especially if you got your house in your late 20s or early 30 so I would prioritize paying off that debt and living a life debt free number two you can diversify your Investments even further so perhaps that's picking up some real estate investing in some businesses or just shifting your portfolio your retirement portfolio towards more conservative assets rather than riskier assets and number three you should know how much you want to spend in retirement every single year it's likely that your kids are going to be out of the house soon so if they are out of the house then you have a better sense of how much you are spending on a monthly and yearly basis there is an 80% rule by Fidelity that can be a good guideline for how much you want to be spending in retirement it states that whatever you're making on an annual basis plan to spend around 80% of that in retirement every single year so if your salary is $100,000 per year you want to plan to spend around $80,000 every year in retirement and here's a great table from Fidelity that has good suggestions on what rule you should be sticking to based on your income range for most people though we want to stick between the range of 55 to 80% now obviously this is a little bit lifestyle dependent but still it's a good guideline to look at all right guys we've made it to the final frontier the age of your 60s the media net worth of someone in their 60s is $454,900 or the retirement age you should aim to have at least 10x your salary Sav for retirement the average income of somebody in America at the age of 60 is roughly $63,500 so that means if you want 10x that salary saved by the time you're 67 you should have at least $635,000 saved up now if you're going for the $1 million at retirement or even more then you're going to at least need minimum 15 times the national average salary and if you want 2 million that's going to be 30 times I think the main goals at age 60 are the following so number one it's very similar to the number one goal of the decade of the ' 50s and that's to have your house paid off this should be self-explanatory but I feel like if you are in your 60s and you still have a mortgage that's not maybe the best financial place to be at you should really be focusing on retirement and looking ahead instead goal number two if you have dependents that rely on you then the assets should be accounted for and you should probably have an estate plan the major components of an estate plan are the living will as well as the healthcare power of attorney at minimum you want to have these documents so that you can State your preferences in case something were to happen to you another benefit of an estate plan is that it allows you to designate a legal guardian for any minor children you might have uring that they're going to be cared for by someone that you trust goal number three is that you have your retirement teed up there's no more guessing in how much more money you're going to need for retirement you know exactly how much you need how close you are to getting there and you have a really solid understanding of your own finan all right guys and that concludes the age of the 60s let me know how much you have saved in the comments as well as your age down below if you are curious about what net worth puts you in the upper middle or lower classes I will leave up my video on that exact topic right here so I will see you guys either in that video or a future video on this channel and thank you for being here make sure to subscribe all right peace [Music]
