The best-known benchmark for "what should my net worth be" comes from The Millionaire Next Door:
Expected net worth = (your age × your pre-tax annual income) ÷ 10
A 40-year-old earning $100,000 should therefore have a net worth of $400,000. Hit twice that number and the book calls you a prodigious accumulator of wealth; land at half or less and you're an under accumulator.
It's a genuinely useful sanity check — and it's wrong in a few specific, predictable ways. Here's how to use it well.
Expected net worth by age and income
| Income | Age 30 | Age 40 | Age 50 | Age 60 |
|---|---|---|---|---|
| $50,000 | $150,000 | $200,000 | $250,000 | $300,000 |
| $75,000 | $225,000 | $300,000 | $375,000 | $450,000 |
| $100,000 | $300,000 | $400,000 | $500,000 | $600,000 |
| $150,000 | $450,000 | $600,000 | $750,000 | $900,000 |
| $200,000 | $600,000 | $800,000 | $1,000,000 | $1,200,000 |
Compare those to reality: the median US household net worth is about $192,700, and the median 35–44-year-old has $135,300. By this formula, the typical American household is an under accumulator — which tells you the benchmark is aspirational, not descriptive.
What the ratio actually measures
The formula's real insight isn't the number — it's the ratio. It measures how much of your income you've converted into ownership rather than consumption.
Two people earning $150,000 can have wildly different net worths at 45. The difference isn't luck or returns; it's what share of each paycheck stopped being spending and became assets. That's why the formula scales with income: earning more doesn't lower the bar, it raises it.
This is the same trap covered in net worth vs income — a high salary is a tool for building net worth, not a substitute for having built it.
Where the formula breaks
It punishes people early in their careers. A 25-year-old earning $80,000 is "supposed" to have $200,000 — after roughly three years of work and likely a student loan balance. Nearly every 25-year-old fails this test, including plenty who are doing everything right. Below about age 30, ignore it.
It punishes people who just got a big raise. Double your income and your target doubles overnight, even though your balance sheet hasn't had time to catch up. The formula assumes you've always earned what you earn now.
It ignores pensions and Social Security. A teacher with a pension worth $700,000 in today's dollars shows up as an under accumulator because that asset never appears on a balance sheet.
It gets harsh in retirement. At 70, still earning $100,000 in part-time and portfolio income, the formula demands $700,000. Meanwhile the median 65–74-year-old household has $409,900 — and is doing fine.
The sweet spot for this benchmark is roughly ages 30 to 60, at a stable income.
Two better ratios
Savings rate. What percentage of gross income becomes assets — retirement contributions, brokerage deposits, principal paid on your mortgage. This is the lever you actually control. Under 10% is thin; 15–20% is solid; above 25% buys real optionality. It's also the fastest of these numbers to respond when you change behavior.
Years of spending covered. Your invested assets divided by your annual spending. Not income — spending. At 25× you're financially independent under the 4% rule. This ratio is the only one that answers the question people are really asking, and it correctly rewards a modest lifestyle instead of penalizing it.
| Assets ÷ annual spending | What it means |
|---|---|
| 0.5× | Six-month emergency fund |
| 5× | Meaningful cushion; a job loss is survivable |
| 10× | Serious flexibility; work becomes optional-ish |
| 25× | Financial independence under the 4% rule |
Use the age-adjusted percentiles instead
If you want a benchmark grounded in actual data rather than a formula, compare against your age cohort directly — net worth percentile by age shows the median and top-10% thresholds for every bracket.
And whichever benchmark you pick, it only works if the input is right. If you've never added it up properly, start with our guide to calculating net worth.
The comparison that matters most
All of these ratios compare you to someone else — a formula, a cohort, a survey. The comparison that actually predicts your outcome is you, twelve months ago.
Your trend line is the only benchmark that accounts for your income, your city, your obligations, and your starting point. Steadily rising beats favorably ranked.
NetTrack tracks your net worth automatically and shows exactly what moved it each month — so you can watch the one ratio that matters. Start free.