How My $1.4 Million Earnings Stack Up Against My $600,000 Net Worth at 33 – Am I on the Right Track?

It’s natural to be curious about how your finances compare to those of your peers, as well as the general public. You might think you’re doing poorly with $25,000 in savings only to realize that the typical person your age has only $5,000. So it’s not always a bad thing to get that type of reality check.

In this Reddit post, we have a 33-year-old who’s wondering how their finances stack up to those of their peers. They have a lifetime earnings total of $1.4 million and a net worth of $600,000. And they’re aiming to retire early with $2.5 to $3 million.

It’s not a bad question to be asking. But ultimately, I would encourage the poster to focus on their needs and goals more so than how their income and wealth compare to others.

Some interesting statistics for context

It’s important to recognize that income and net worth don’t always go hand in hand. You can earn a lot of money but spend a lot so you’re not really growing your net worth at an optimal pace.

The Federal Reserve reports that as of 2022, the average net worth among Americans under 35 $183,500. But the median net worth was only $39,000.

What this tells us that is that $39,000 is probably a better representation of young Americans’ net worth on a whole. The $183,500 figure is probably being skewed upward by a small subset of people under 35 who happen to have a lot more wealth.

But either way, seeing this should make the poster feel pretty good about their $600,000 net worth. That’s more than three times the average net worth among their peers.

Meanwhile, the Bureau of Labor Statistics puts the median annual salary among Americans ages 25 to 34 at $57,356 as of mid-2024. So, let’s say the poster above earned that salary over the past 12 years — between ages 21 and 33. That would give them lifetime earnings of about $688,000.

However, they report that their earnings to date total $1.4 million. This means the poster has likely earned more than twice as much as their peers since starting their career.

It’s best to focus on your own needs and numbers

The poster may take comfort in how well they’re doing compared to people their age. And there’s nothing wrong with wanting to have that information.

But what might be a better use of the poster’s time is to focus on strategies to build their own net worth. Those could involve investing in stocks, buying real estate, or starting a side business.

It’s also important to focus on your financial needs and goals more so than your net worth at various stages of life. What the poster should do is figure out when they want to retire and what they want life to look like then. They should also decide what they want life to look like during their remaining working years.

The poster says they’re aiming to retire with $2.5 to $3 million. But why? What is that money for? That’s what they need to figure out.

Talking to a financial advisor would also be a good bet. An advisor can help the poster, or anyone else in a similar situation, come up with a near- and long-term plan that helps them meet their goals. They can also perhaps give them reassurance that they’re doing well financially. By asking for comparisons, it seems that the poster may need some of that for peace of mind.

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