Wealth varies quite a bit in the United States, and it's no secret that much of it is concentrated at the top. Even knowing that, the amount of wealth of the richest families could be surprising.
With the release of the Federal Reserve's 2022 Survey of Consumer Finances, there's new data available on the net worth of families in the top 10%. Net worth is calculated by adding up a family's assets and subtracting any debts. Here's the latest data.
The net worth of the top 10%
The top 10% of families have a median net worth of $3.79 million. The median net worth for the United States as a whole, on the other hand, is $192,900. That means families in the top 10% have nearly 20 times as much as the typical U.S. family.
On a positive note, overall net worth has been increasing. During the previous Survey of Consumer Finances in 2019, the median U.S. net worth was $141,100, so it has gone up by 37%. That's actually a larger increase than the median net worth for the top 10%, which went up by 26% from 2019 to 2022.
In fact, all the groups analyzed in the survey saw positive changes in their net worths. That includes every income group and age range. The wealthiest Americans certainly have much, much more. But anybody can increase their net worth, and that's a good goal to set for yourself. As a general rule, if your net worth is going up, that's a sign you're doing the right things with your personal finances.
What are the keys to a high net worth?
Reaching a high net worth, such as $1 million or more, is a common financial goal. While there's more than one way to get there, the recent survey data can give us an idea of what tends to work best for building net worth. Here are the common characteristics of people with higher net worths:
- They earn large incomes. Net worth rises significantly in every income percentile. The median net worth is $14,000 for earners in the bottom 20%, compared to $2.56 million for those in the top 10%
- They have higher levels of education. People with a college degree have a median net worth of $464,600. That's more than four times as much as high school graduates ($106,800) and more than 12 times as much as people with no high school diploma ($38,100).
- They're homeowners. Homeowners have a median net worth of $396,200, compared to $10,400 for renters.
- They're older. Net worth rises for older Americans. Those younger than 35 have a median net worth of $39,000. It peaks at $409,900 for those between 65 and 74.
This doesn't mean you need to fulfill all those requirements to have a high net worth. It's certainly possible to build wealth with an average income, without a college education, and as a renter. But these characteristics show some strategies that have worked for many Americans, so they're worth considering.
If you're trying to build your net worth, a great place to start is with your income. As you earn more, it becomes easier to save more. See if there are ways to advance and make more money at your current job, or if you could increase your earnings with a new job or a side hustle.
The other key ingredient is where you put your money. As the data shows, many people build wealth through their homes, but that's not your only option. Investing in stocks is another way to build wealth. Even if you're a homeowner, it's still a good idea to buy stocks, as well. They offer excellent growth potential, with the average stock market return being about 10% per year. They're also more liquid than owning a home, as you can buy and sell stocks quickly with online stock brokers.
Building your net worth ultimately comes down to how much you earn versus how much you spend. If you consistently save and invest a portion of your income, you'll see positive results.
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FAQs
Top 2% wealth: The top 2% of Americans have a net worth of about $2.472 million, aligning closely with the surveyed perception of wealth. Top 5% wealth: The next tier, the top 5%, has a net worth of around $1.03 million. Top 10% wealth: The top 10% of the population has a net worth of approximately $854,900.
How do you answer net worth questions? ›
To calculate your net worth, you subtract your total liabilities from your total assets. Total assets will include your investments, savings, cash deposits, and any equity that you have in a home, car, or other similar assets. Total liabilities would include any debt, such as student loans and credit card debt.
How rich do you have to be to be in the top 10%? ›
How much do you need to earn to be in the top 10% income bracket? A 2022 study by the Economic Policy Institute (EPI) found that the top 10% of earners nationally received an average income of $167,639 in 2021.
What percentage of wealth do the top 10 hold? ›
U.S. wealth distribution Q3 2023
In the third quarter of 2023, 66.9 percent of the total wealth in the United States was owned by the top 10 percent of earners. In comparison, the lowest 50 percent of earners only owned 2.5 percent of the total wealth.
What salary is considered rich for a single person? ›
Based on that figure, an annual income of $500,000 or more would make you rich. The Economic Policy Institute uses a different baseline to determine who constitutes the top 1% and the top 5%. For 2021, you're in the top 1% if you earn $819,324 or more each year. The top 5% of income earners make $335,891 per year.
What net worth is considered very rich? ›
According to Schwab's 2023 Modern Wealth Survey, Americans perceive an average net worth of $2.2 million as wealthy. Knight Frank's research indicates that a net worth of $4.4 million is required to be in the top 1% in America, a figure much higher than in countries like Japan, the U.K. and Australia.
Does a 401k count as net worth? ›
Yes. The value of your 401(k) account is a part of your net worth and should be included in your net worth. Like anything else of financial value, the vested balance of your 401(k) account — or any retirement account, for that matter — is considered an asset.
How much is Taylor Swift worth? ›
She also owns numerous pricey properties across the U.S. Both Bloomberg and Forbes pin her net worth at an estimated $1.1 billion on the low end, based on analyses of her fortune. Swift first achieved billionaire status in October when she released a re-recording of her nine-year-old album "1989," Bloomberg reported.
How do I calculate my net worth? ›
Start with what you own: cash, retirement accounts, investment accounts, cars, real estate and anything else that you could sell for cash. Then subtract what you owe: credit card debt, student loans, mortgages, auto loans and anything else you owe money on. Then boom—you've got your net worth.
What income is middle class? ›
Key Findings. In a large U.S. city, a middle-class income averages between $52,000 and $155,000. The median household income across all 345 cities is $77,345, making middle-class income limits fall between $51,558 and $154,590.
Average net worth by top percentile and age
| Age | Top 1% net worth |
|---|
| 35-39 | $4,741,320 |
| 40-44 | $7,835,420 |
| 45-49 | $8,701,500 |
| 50-54 | $13,231,940 |
3 more rowsMar 27, 2024
Many have graduate degrees with educational attainment serving as the main distinguishing feature of this class. Household incomes commonly exceed $100,000, with some smaller one-income earners household having incomes in the high 5-figure range. "The upper middle class has grown...and its composition has changed.
What is the average net worth of Americans? ›
Net worth is the difference between the values of your assets and liabilities. The average American net worth is $1,063,700, as of 2022. Net worth averages increase with age from $183,500 for those 35 and under to $1,794,600 for those 65 to 74. Net worth, however, tends to drop for those 75 and older.
What percent of Americans are wealthy? ›
The top 1% of American earners now control more wealth than the nation's entire middle class, federal data show. More than one-quarter of all household wealth, 26.5%, belongs to Americans who earn enough money to rank in the top percentile by income, according to Federal Reserve statistics through mid-2023.
What race holds the most wealth in America? ›
Total household wealth grew in 2022, but white households still hold the vast majority. Since 2010, the wealth disparity between Black and white families has persistently expanded.
What percentage of Americans have a net worth of over $1,000,000? ›
Additionally, statistics show that the top 2% of the United States population has a net worth of about $2.4 million. On the other hand, the top 5% wealthiest Americans have a net worth of just over $1 million. Therefore, about 2% of the population possesses enough wealth to meet the current definition of being rich.
How many people have $3000000 in savings in the USA? ›
How many people have $3,000,000 in savings in the USA? There are estimated to be a little over 8 million households in the US with a net worth of $3 million or more. I very much doubt that any of them have that amount in savings. A good many of them reach that level because of a large equity in an expensive home.
What percentile is a $3 million net worth? ›
The 95th percentile is considered wealthy, with $3.2 million household net worth, so even more spending power, which means estate planning and possibly more than one home.
What net worth is top 20 percent? ›
What is the net worth for the top 20% of Americans? The top 20% net worth in the U.S. is $558,189 in 2022. You must be over halfway to millionaire to be in the top 20% of wealthiest Americans.
