How Much Net Worth Should You Build Based on Your Income Level?

Tracking your net worth isn’t just about knowing a single number—it’s about setting realistic wealth targets that grow with your age and income. Whether you’re earning a modest salary or a substantial income, understanding what your net worth should be is essential for long-term financial planning and retirement readiness.

Understanding Net Worth: The Foundation

Your net worth is straightforward: total assets minus total liabilities. It’s a snapshot of your financial health that tells you exactly where you stand. To calculate it properly, you need to account for everything you own and everything you owe.

Assets include:

• Cash and savings accounts
• Retirement accounts (401k, Roth IRA)
• Investment and brokerage accounts
• Real estate and property
• Vehicles
• Personal valuables

Liabilities include:

• Credit card debt
• Student loans
• Mortgage balance
• Auto loans
• Any other outstanding debts

For example, if you have $400,000 in home equity, $50,000 in retirement accounts, $10,000 in cash, and a $10,000 car, your total assets equal $470,000. After subtracting $350,000 in mortgage debt, $15,000 in car loans, and $5,000 in credit card debt, your net worth would be $100,000.

What Your Net Worth Should Be at Different Ages

Most financial experts recommend a return on net worth formula based on your income multiple at specific life stages. Here’s what the targets look like:

Age 30: Aim for 1x your annual salary Age 35: Aim for 2x your annual salary Age 40: Aim for 3x your annual salary Age 45: Aim for 4x your annual salary Age 50: Aim for 6x your annual salary Age 55: Aim for 7x your annual salary Age 60: Aim for 8x your annual salary Age 65: Aim for 10x your annual salary

You can use a simple formula to calculate your target: (Your Age ÷ 10) × Your Annual Gross Income. If you’re 35 earning $80,000 annually, your target would be (35 ÷ 10) × $80,000 = $280,000.

How Net Worth Scales With Your Salary

Your net worth targets should reflect your actual earning level. Someone earning $50,000 annually shouldn’t expect the same net worth as someone earning $150,000. However, both can build meaningful wealth over time.

Here’s what net worth could look like at age 35 for different income levels, assuming consistent savings and 5% annual investment returns:

The key insight: higher earners should maintain higher savings rates. As your income grows, your savings capacity increases, allowing your investments to compound more significantly.

Age-Based Net Worth Benchmarks by Income Level

Your net worth milestone varies based on both age and income. Here’s what you should aim for at key life stages:

The pattern is clear: your net worth compounds as you age, and those starting with higher incomes build wealth faster—but building wealth is possible at any income level with consistent saving and investing.

Building Your Net Worth at Your Own Pace

Don’t compare your net worth to someone in a different income bracket. A 35-year-old earning $40,000 annually might legitimately have less net worth than a 50-year-old earning $60,000, even if the older person has a lower salary. Time in the market, compound growth, and career progression all play roles.

The important thing is consistent progress. If you’re earning modestly now, focus on maximizing your savings rate, investing that money for long-term growth, and building valuable assets like home equity. Over time, your income typically increases, which accelerates wealth building.

Key Takeaway

Your net worth should grow steadily throughout your career. By understanding your income multiple targets at each age, you can assess whether you’re on track or need to adjust your savings and investment strategy. Remember, these are guidelines—your actual targets should align with your personal retirement goals and financial situation. Meeting with a financial advisor can help ensure you’re positioned correctly for long-term wealth building.