Usually, we think of gross income (salary) as the measuring stick of how well off or wealthy a person is currently. However, I think this is a poor measure compared to net worth.
I have seen many people with huge gross incomes with little net worth.
I have seen many people with rather small gross incomes with a high net worth.
Since Net Worth = Assets - Debt, it really makes you realize how much of an effect debt has on your personal balance sheet. You may be making 90k a year, but actually have a negative net worth because you are up to your eyes in debt!
An alarming number of people under 35 have a net worth FAR below zero?! The average person fresh out of college has over $27,000 in student loans. With the high unemployment rate for these people, their student loan balances just keep accumulating interest. At what age will these people raise their net worth to a positive number?
At what age did your net worth become positive?
References:
http://www.fabulouslybroke.com/2011/03/what-should-your-net-worth-be-net-worth-by-age-and-by-income/
http://www.bargaineering.com/articles/average-net-worth-of-an-american-family.html
http://www.bloggingawaydebt.com/2010/06/negative-net-worth…/
http://money.cnn.com/2012/10/18/pf/college/student-loan-debt/index.html
I have seen many people with huge gross incomes with little net worth.
I have seen many people with rather small gross incomes with a high net worth.
Since Net Worth = Assets - Debt, it really makes you realize how much of an effect debt has on your personal balance sheet. You may be making 90k a year, but actually have a negative net worth because you are up to your eyes in debt!
An alarming number of people under 35 have a net worth FAR below zero?! The average person fresh out of college has over $27,000 in student loans. With the high unemployment rate for these people, their student loan balances just keep accumulating interest. At what age will these people raise their net worth to a positive number?
At what age did your net worth become positive?
References:
http://www.fabulouslybroke.com/2011/03/what-should-your-net-worth-be-net-worth-by-age-and-by-income/
http://www.bargaineering.com/articles/average-net-worth-of-an-american-family.html
http://www.bloggingawaydebt.com/2010/06/negative-net-worth…/
http://money.cnn.com/2012/10/18/pf/college/student-loan-debt/index.html