Reported by Ryan Brennan
The idea of “net worth” isn’t explored by many now-a-days. The average person would probably fail to be able to give you their net worth, simply because they don’t know it. However, that all changes once they learn how to calculate it. Now, it suddenly becomes a game of who is worth the highest.
Let’s figure out how to calculate your own net worth as it currently stands right now. First, you must understand what your net worth stands for. Basically, your net worth is the number you get when you add up all of the “stuff” that you own (for example, car, house, xbox) and subtracting whatever you owe (mortgage, college loan, credit card debt).
Take a piece of paper and split it up into two columns. One column will be called Assets, which will be the things that you own. The other column will be called Liabilities, which are the things that you owe. Take a second and think about everything that you own and owe. As you think of things, write them down in their proper column. If you’re unsure about your house, which might have a mortgage, then put it under Assets and put whatever you still owe on the house in your Liabilities column.
Once finished, subtract the total of everything in the Liabilities column from the total of everything in the Assets column. Now, you approximately know your net worth.
Back in 2011, a report was released by the Census Bureau that outlined the median household net worth when compared by a person’s age. For this instance, we will use both a number standpoint and a quintile standpoint.
For someone who is 35 years old, the median household net worth is only $6,682 for the 50th percentile. For anyone between the ages of 35-44, their household net worth is an average of $35,000 for the 50th percentile. Fast forward a couple decades, anyone 60 years old or older has a median household net worth of $171,135 for the 50th percentile. The 70th percentile requires a household net worth of $344,870.
However, it should also be noted that a large majority of the net worth of the older groups of people go towards their house. Younger people almost always tend to have a lower net worth. This is mainly due to them taking on new mortgages, as well as lower salaries, and the high student loan debts students suffer from today.