Net Worth

[pepsi91307]

In your opinion, what would you say is a healthy net worth for a mid to late 20's individual?

Of course, there are many variables. Where you live, the field you work in, student loans, married/single, I'm sure it varies greatly if one owns their home. Just trying to see people's varying answers.

Comparing isn't the intent here. But sometimes a general reference point is helpful when one is starting out.

[koolkat1980]

Well Pepsi...I think it's all relative really! There's other factors to include also!

A person's lifestyle habits, do they smoke, party every weekend, are they living at home, do they have a mortgage. Everyone is different some people like to splurge on Jimmy Choo shoes and others are happy to shop at Walmart for shoes.

Also a person's chosen profession makes a difference as well. Some people are on 6 figure salaries, Lawyers, Surgeons, dentists....others are well....plain Jayne. So....to answer this....it's all relative.

[Mini14]

I think this is a really hard question to answer because people can be in vastly different situations in their mid to late 20's.

Without giving out too much information, the amount I owe in university loans would approximately equal what I have in assets and savings, i.e. a net worth of zero :) This will change though as soon as I'm able to get a full time job in my field.

[winneythepooh7]

This is a REALLY difficult question to answer without getting into the "compare game". I know at that time in my life, I was single, renting, not making a whole lot of $$$$ and maybe had a couple thousand in savings. I also owe a lot in student loans, and now that I am married and in my early 30's, we have also added a mortgage to that equation.

[ebrillblaiddes]

Mine is a really big negative number and is going to be for at least the next 10 years (if I find a job that qualifies for the public service writeoff on my student loans). When I started taking out loans, I hoped to be back at 0 net worth by 30 by getting a real-paying job right away and continuing to live a studentlike lifestyle, but it didn't work out that way...I got more loans than I meant to, because of needing grad school, and the career got off to a less smooth start...and at this point I doubt I could do it if I had a salaried full-time job tomorrow.

[vinsanity]

What with student loans, upside-down mortgages, and consumer debt, I wouldn't be surprised if most people's net worth was negative.

[ebrillblaiddes]

What with student loans, upside-down mortgages, and consumer debt, I wouldn't be surprised if most people's net worth was negative. But that would lead to...
*looks around at economy*
Ah, right.

[wordsmith]

I wouldn't be surprised if most people's net worth was negative.

Particularly at this stage of life, if you're a decade or less from having finished schooling, and if you took out student loans.

I take comfort in the fact that I started out my adult life with less educational debt than the majority of people my age have in consumer debt, but it's still something that takes time to pay back.

[spiritedaway]

I don't have any consumer debt (just the monthly expenses kind) and my educational debt's paid off, but my net worth is some 6-digit negative value due to mortgage. I'm not looking to sell anytime soon (the property is holding its value) and I'm not paying that much more than if I were renting, so I have a pretty good setup right now.

Assuming no major consumer or educational debt and excluding mortgage, my general take is that it seems reasonable that most people should have saved enough to cover themselves for any housing/emergencies for at least 6-9 months by the mid-late twenties (and is working, or have already begun to pay down any other outstanding debts).

This, of course, varies by individuals and their situations (i.e. those currently unemployed in this economic climate and who have to dip into their savings and credit cards), but outside of extenuating circumstances, that seems like a reasonable expectation to me.

[larry52]

Totally dependent upon the education/work path one took.

I'd expect a training physician to have a negative net worth until after age 30, but that's not a problem because the income potential is huge.

Someone who started working at 18-22 should start building a solid net worth by the late 20s. My personal opinion is that people need to save at least 20% of their after tax income, so this means the average person should save around 15% of his or her pre-tax wage.

This roughly means that for each six years of working one should have one year of pretax salary saved. Someone at 28 making 50K post college at 22 should have a 50K net worth.

[cupkake]

It varies so much, I think it's hard to tell and it's similar to the whole "qlc" phase and the coining of the term because of the pressure or assumption of being expected to be a certain place when you aren't. An assumed net worth?no predetermined factors can be analyzed because everything is different for different people.

[vinsanity]

My personal opinion is that people need to save at least 20% of their after tax income, so this means the average person should save around 15% of his or her pre-tax wage.

This roughly means that for each six years of working one should have one year of pretax salary saved. Someone at 28 making 50K post college at 22 should have a 50K net worth.

...if they can afford to. It's hard enough to save up $7500/yr from a mediocre salary in a high COL area, let alone trying to get by on less during the starter years.

[ebrillblaiddes]

my net worth is some 6-digit negative value due to mortgage. I think you're forgetting to count the house itself as an asset, unless your closing costs were nuts. The initial mortgage and the home value theoretically cancel out, so if you're making regular payments and the house hasn't lost more value than you've paid, the house and mortgage on average should have a positive effect on your net worth.

[Minipan]

It really depends. Some people are still in school in their late 20s. My husband got two masters and didn't finish school until he was about 29 or 30. Other people start working immediately and saving, or buy a house, etc.

I started working immediately upon finishing undergrad and have been contributing to 401(k) for about 7 years (I'm 28). I had some debt, but paid it all off within the last year (including student loan). Now I have a mortgage, but I'm building equity.

I would say it really varies based on when people finish school and when they decide to get serious about saving. Some people spend their 20s figuring out what they want to do or traveling, etc. Some people work. Some people are still in school. So, there's a ton of factors and variables.

[pepsi91307]

thanks everyone for the input

[Ed0214]

Mine is probably above average, because I never had student loans or credit card debt, and bought a house in a low cost of living area. I have also worked and saved since age 14. However many of my college classmates probably make 50% more than I do working in big cities, so maybe it alll equals out in the end.

Sometimes it's hard to tell. One college classmate I thought was personally well off. Great big city job, had a 75% scholarship ride in college, lived in a cheap suburban apartment, drove an old car, no vacations, etc. He must be saving 50% of his income, right?

Well I found out last month he has lost over $75,000 in online gambling in the past year.

Appearences can be deceiving.

[ebruening]

I also think that your relationship choices play a big factor in your net worth, too. I had a positive net worth before I got married, and my husband brought some debt in to the marriage. That debt lowers my net worth, even though I wasn't the one who incurred it, and it was incurred before our marriage.