Is your Net Worth Below The National Average for Your Age? (#217)

Financial Advisors Say The Darndest Things

Episode Summary: In this episode of "Financial Advisors Say the Darndest Things," host A.B. Ridgway explores the topic of average net worth by age. He delves into the societal pressure of comparing oneself financially to others and provides clarity on understanding one's own financial standing. Ridgway emphasizes the importance of contentment and stewardship from a Christian perspective while offering practical insights into financial planning.

Key Takeaways:

1. Comparison Trap: Ridgway highlights the common tendency to compare one's financial status with others, especially in the age of social media. He urges listeners to resist the allure of comparison and instead focus on personal financial goals and contentment.
2. Understanding Net Worth: By explaining the calculation of net worth as assets minus liabilities, Ridgway demystifies a fundamental financial metric. He emphasizes the significance of this calculation in assessing one's financial health and progress.
3. Median vs. Average: Ridgway clarifies the difference between median and average net worth, illustrating how outliers can skew average calculations. He advocates for using the median as a more representative measure of typical financial standing.
4. Age-Based Benchmarks: Ridgway provides age-specific benchmarks for net worth, offering listeners a framework for evaluating their financial progress relative to their age group. He underscores the importance of recognizing different life stages and financial priorities.
5. Contentment and Stewardship: Drawing from biblical principles, Ridgway encourages listeners to cultivate contentment and responsible stewardship of their financial resources. He emphasizes the spiritual aspect of financial management and aligning one's values with their financial decisions.

Quotes:

1. "Regardless of how much money we make, there's always a burning question within us. Am I making enough for my age? Am I on track, ahead, or falling behind?"
2. "The problem with the average is that the wealthy individuals actually drive that average up."
3. "As Christian investors, it is our job to stay content because we know God will take care of us."

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Federal Reserves Survey of Consumer Finances

scf23.pdf (federalreserve.gov)