MoneySense Magazine Net Worth Milestones

After flipping through the summer edition of MoneySense Magazine, I came across an interesting article that answers a reader question that I get often.

“What should my net worth be for my age?”

Here is what the magazine came up with as an average net worth by age group:

Age 35 to 44 Age 45 to 54 Age 55 to 64
Median net worth $160,000 $265,000 $450,000
% who own a home/value 68% / $240,000 74% / $225,000 77% / $220,000
% w. mortgage/value 81% / $115,000 60% / $90,000 39% / $70,000
% w. RRSPs/value 63% / $25,000 68% / $45,000 69% / $65,000
% w. pension/value 48% / $35,000 52% / $120,000 60% / $260,000

How do those numbers look to you? Does your net worth stack up against Canadian averages?

As a side note, It just so happens that at the end of the magazine, Million Dollar Journey was mentioned in the “Consume this” section. It’s one thing to be mentioned in a newspaper, but I’m particularly thrilled to have been recognized by a magazine that I’ve been following for years.  Special thanks to Canadian Capitalist and other readers for giving me the heads up on the mention.

Here’s what they said:

..the young engineer who writes this blog hails from Newfoundland.  his goal is to amass a million bucks by the time he hits 35.  And, judging from the wide ranging material on his site, he’s willing to do just about anything to make that happen.

OUR TAKE: What makes this site work is the personality of the anonymous author.  He describes himself as an “obsessive-compulsive personal finance guy,” but he’s actually immensely likable.  While we could quibble with some of his views, there’s no doubting his spirit.

For those of you interested in getting a subscription to MoneySense Magazine (or other popular magazines), find out how you can get an additional 16.25% discount off your magazine subscription.

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FT

FT is the founder and editor of Million Dollar Journey (est. 2006). Through various financial strategies outlined on this site, he grew his net worth from $200,000 in 2006 to $1,000,000 by 2014. You can read more about him here.
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Roger
10 years ago

Hi, I am 35 years old but live paycheck to paycheck. Being a renter and not a homeowner, I am not building any equity whatsoever, and I have no RRSP’s or TFSAs contributed since I am making $12.00 an hour which pretty much all goes to fixed expenses.

Damien
13 years ago

These numbers mean nothing. If you live in downtown Toronto or Vancouver, your competitions will have much higher cut-off line than the numbers above. Just like any other competition, you will always want to compare with higher standard

Telly
13 years ago

While not quite in any of those categories yet, we seem to be doing better than “average” in terms of higher net worth, lower mortgage value, & substantially higher RRSPs (those #’s are pretty dismal). Our home value (not a bad thing imo) and pension values (thus the higher RRSPs) are lower than average though.

Congrats FT! I forgot to mention having read that!

Jon Kepler
13 years ago

Glad to see the 25-34 numbers posted above. What about for people under 25? Is it safe to assume their net worth is zero or negative?

Gates VP
13 years ago

MoneyGrubbingLawyer: It seems to me that my generation is going to have a lot of catching up to do…

I’m not really sure that’s the case. Lots of lurking variables here.

My income doubled from age 22 to age 27. The first years post-degree tend to be very growth-heavy, plus I know some people who didn’t get their degree until 26 or 27, so they’re definitely not helping the average.

We’re on a 15-year boom for the housing market, so some of those housing numbers are likely quite inflated. I’m 27, make 75k and I can’t justify the cost of a new home. I have lots of friends my age and very few of them have mortgages b/c they’re simply too expensive. There was a time many years ago when an engineering or teaching-level job and a couple of years experience was enough salary to justify the cost of a home (especially as a couple). That’s simply not true any more. (there was a previous post about the median income vs. median home price, it wasn’t pretty)

I also seriously question that 50% of the 25 year olds are receiving pensions. That number is much likely closer to 25%

We also live in a generation where people are not fixed on retiring at 65. If you’re not racing to wealth at 65 (or 55) just so you can retire, then you’re not as worried about socking away tons of income. I know tons of people living the “vagabond” existence with lots of travel and working in different countries (even with kids). I just don’t think that building up a massive net worth and then retiring to the beach is really the way our 27-year olds view the world.

MoneyGrubbingLawyer
13 years ago

MJW, thanks for the 25-34 numbers. I am surprised at just how low the middle 20% numbers are, and that it only takes a net worth of $89,000 to make it in to the top 20%. It seems to me that my generation is going to have a lot of catching up to do…

Cash Canuck
13 years ago

I would be put off if someone gave me this answer to the question: “What should my net worth be for my age?”

Simply showing me the median values does me no good unless I’m the median earner (be definition only 1 person is the median earner).

What if I earn 50% less income than my neighbour of the same age and we have the same net worth? Shouldn’t your “expected” net worth take your income into consideration?

This concept is one of the central points in Thomas Stanley’s “The Millionaire Next Door”. You will be wealthy if you consistently save more than you spend, which is largely dependent on your lifestyle, and your income. The formula he uses for expected net worth is basically Age*Income divided by 10. That’s a good starting point but it does not account for the rapid growth in earning power many young people experience. I read this book in my early 20’s and was discouraged after calculating my own wealth estimate.

This is a very loaded question and I think much more than a survey is needed to answer it properly.

mjw2005
13 years ago

Here are the net worth numbers for the 25-34 age group…from the same article…

Poorest 20% – below $1300

Next Poorest 20% – $1300 – $9400

Middle 20% – $9400 – $34,000

High Middle 20% – $34,000 – $89,000

Highest 20% – More than $89,000

Based on these numbers I fall into the high middle category for my age group….but will have to do alot of saving to catch up to the average for the 35 – 44 age group….

Neat article….

moneygardener
13 years ago

It absolutely is healthy to benchmark against peers. Anyone who reads MoneySense magazine likely cares about the state of their personal finances and/or their net worth.

Obviously keeping up with the Jonses for the sake of it is unhealthy, but striving to grow net worth and checking up on your country’s averages is great. Most people who strive to keep up with the Jonses materially, won’t be reading MoneySense, and could be lagging behind in net worth anyway by taking on too much debt and consuming too much.

DAvid
13 years ago

Jordan Clark,
Do a bit of research on the CPP, and you will find it is financially secure for the future. This was not the case some years go, but it has been entirely revamped since the time when it was funded from current tx revenues.

DAvid