Im 57. Been maxing out my 401K and my IRA from the start when I could. Have 2 mil saved now with a salary of 150,000 a year (started at 50k). Still have a few more years of work before I retire, so looking at 2.5 to 3 in savings. With social security, I’m sitting fine for my retirement. The system is there if you disciplined and save. Don’t need to be a tech guru or business owner. Look at what is available and put your money in rather than buying bubble gum and candy.
@@freddyrodriguez4732 Not that much of a genius. Imagine when he has to pay taxes on his RMDs in his 401k/ IRA? If it was in 401k Roth and Roth IRA he would tax free and RMD free in the end game. Pay the taxes upfront and never worry again. So his 2 mil is actually less since Uncle Sam will be knocking.
@@AugieBenDougie-wk9pr yeah thats what Im saying, also to move your salary up from 50K probably means youre very smart and educated. what loans does he have? what iq? most people dont have those things
@@freddyrodriguez4732 this is just a friendly suggestion, and if it's not for you or you're already thinking this way, then please ignore me. I would argue that you should focus less on the things you don't have, and focus on the things you do have or can improve. "very" is relative, and "smart" people that don't want to work won't have money, and "educated" people who make good 100k+ but can't control their spending and do not have save won't build wealth either. And don't compare yourself to others or frame success as "he's smarter than me so he's successful but I'm not smart so I can't be". Just compare you to yourself - are you wiser and more experienced this year compared to last year? Work from there, and money/wealth will come naturally. Good luck!
I’m 58 yrs old and never had a sky high salary but after 32 years maxing out 401k and Roth plus a long term holding in AAPL with 2 rental homes and no debt on our primary residence we have $3 million in wealth. It’s not rocket science just live below your means and stay in equities and it only grows!!
The more important factors are having low EXPENSES and NO DEBT . There are many people earning six figure sums , but are FLAT BROKE because of their living expenses and what they owe.
If you're an Engineer or lawyer earning $150K, and full of debt. Just file BK. Start over. That income is amazing as a 30 year old....take advantage of the lax US laws in these instances.
I started contributing to my 401k my second paycheck out of college. It was tough with a mortgage, student loans, etc. I worked six days a week as an Engineer. In those days we got OT on everything over 40 hours. Then I met my partner (now 35 years together) he was into saving/investing as well. By the time we retired we were saving 35 percent of our income . He retired at 63 and I was 57. Saving/Investing on autopilot works.
We saved in 8 years of marriage $40,000 by wife banking everything she earned and in the military having money put in savings automatically. That was 1974 equivalent to $264,000 in 2024.
@@glendavis1266 Good deal. I hope after eight years you kept saving/investing. I can’t imagine doing the time value of money over 35 years. We kept increasing the percentage we saved over time. From 8% to 35%.
I started both of my kids Roth IRAs while they were in high school. They each had contributed $10,000 by the time they graduated. They continued to contribute while in college.
Don't put too much stock into how much you make. Focus on reducing your spending and debts. Prioritize a broad range of investments into things like mutual funds. In the beginning, avoid single stocks. I don't make that much money, but my investments out earn me. I live beneath my means and am very strict with myself about not taking out debt and paying off my credit card in full every month. Little, simple, diligent steps can take you a long way.
Financial literacy should be taught in schools...I understand it's starting in some places. My own awakening came with reading The Millionaire Next Door, and after which I read all that I could get my hands on from Graham & Dodd, Buffett, Munger, Lynch, Fisher, and Ramsey. The bottom 20% in the country should be taught the Asian mind set that education/hard work is the way out of poverty. Yes, multiple streams of income is the ticket.
@@hugegoogleThere is a financial literacy class in the high school I went to. The problems is the class means little when students are surrounded by family members and peers making bad personal finance moves. Spending more on overpriced brands and depreciating assets like cars, than putting money into 401ks.
Would like to see a similar video for those of us who are retired, yet have substantial wealth even though our annual income is less impressive than others might think.
We save too much money. I don't spend hardly any money at all....I don't look in the mirror as a 60 year-old and find myself impressive. I don't really help the economy, i.e....I saved almost all my income from Covid related crap. I'm trying to find ways of giving my money away really. If my son has my kind of wealth by the time he's 30, then I'll be impressed.
Another "same here." Always lived within my means and would be well-situated even without inheritance. Was talent in a high-paying field, aware I wasn't top of the pay scale but also aware I wasn't one of the members-only club that was. Drained non-retirement savings when laid off, rebuilt with new job by retirement at 67. Recommend pursuing a career in a field you enjoy. Be nice to people ESPECIALLY co-workers and customers. It's good practice because they're who you'll need to welcome you back into the workforce if you get laid off.
Thanks so much. I do take some comfort in the fact that the mortality rate for the top earners has held steady at 100 percent for a significant period of time. Eternity is quite a long time.
Great info. Deca-millionaire is a personal goal since II heard about term when I read "Millionaire Next door" in my 30s about 12 years ago. Wealthy but frugal and unassuming people with mostly who drove trucks and midsize sedans instead of German brands - this book shocked me as I was one of the folks who think wealth is the same as income and what "people see". Being in the top 1% is a possibility for high income folks making less than 500k/year as long as they leverage the power of compound interest.
@@alishakir1940 you do you…. most wealthy people I know started w nothing and naturally became wealthy and became part of 1% w great attitude and hard work and they also give back to their Church,non profits & give gofundme.. id rather hang out w that than bums complaining about their sad “i’m a victim” life
You work for 40yrs to have $1m in your retirement, meanwhile some people are putting just $10k in a meme coin for just few months and now they're multimillionaires. I pray that anyone who reads this will be successful in life
I urge everyone to start somewhere now no matter how small, this is literally the time for that, forget material things, don't get tempted, I became more better the moment I realized this
I was a lowly military doctor (so I earned 40% of a civilian M.D.) but a net worth of $2.6MM, so I early retired age 37. Although i've enjoyed traveling the world and having fun, I miss working so i will go back to part time work
Lowly my ass!! You got paid less but your pension benefits were sky high, hence your early retirement! Or else how did you get that lotto jackpot net worth? Inheritance from grandfolk?
@@gbb82 Nope. I did 16 years, only 12 years credited for retirement though (the 4 years from medical school only kicks in once you hit 20, then you get 24). So I decided to separate
I find it helps to be obsessed with money/wealth. I spend a great deal of the day learning about taxes and alternative ways to invest and then reinvest profits.
Don’t know where she obtains her statistics from but based on her criteria and commentary my wife and I were in the top 10% before we retired in 2020! Our combined yearly income was $210,000, with annual bonuses of $12,000. We were both in banking industry for a long time, with me going from lending to IT projects. However, I never completed college and she never went to college, which blows her statistics out. I know many like us so her comments are misleading. A lot depends on your age, where you live, etc. Before Covid we had net worth of over $2.5 million. The secret was to save at 6-10% of your earnings, don’t buy new cars and to have pension savings when we retired.
"The secret was to save at 6-10% of your earnings" That is not enough, less you get lucky but most people either get market returns or less. Most people should work their way up to 15% to 20% of their pay being invested for the future.
@@mjs28s It depends on how EARLY you start saving and investing. Even small amounts, if started before your 30th birthday will help enormously if done regularly. Sanjosemike (no longer in CA)
@@peterchen9194 So does my son-in-law and our daughter. They would certainly agree with you. But both are very high earners with a very high IQ. Both are degreed engineers. I detected her very high IQ when she was only 5. Unfortunately, most people we are talking about are not in that category. Sanjosemike (no longer in CA)
And that's the true goal everyone should have. If you want that once-in-a-while dinner at XZY restaurant, go and don't worry about the cost. That's the true meaning of wealth. This stuff about keeping up/showing off to the Jones is why Europeans live longer - they take life slower and enjoy it.
@@mellocello187 Giving your money to government and having government trickle it down to you never worked for me. Others like the security of having big brother take care of you. No thanks. I don't think Big Brother (a committee?) Is smarter than me. Most times, they are more interested in what is in it for themselves, not my best interests.
@@WilliamMurphy-uv9pm Wait until you see the coming wave of retirees who have saved nothing and will end up on the street. And are you aware of the number of medical bankruptcies in the US? You, sir, are another example of what is wrong with this country. It’s all me me me. Since you haven’t experienced, it’s not a problem. I’m sure you will not partake of any social supports, like Social Security or Medicare, right? You’ll pay your own way for everything out of pocket. Uh huh.
Interesting. I'm glad you've descended from a culture that values education, achievement, hard work, meritocracy and strives to 'keep informed' during their voyage through life. I admire Asian-Americans, Jewish Americans and anyone else who admires and pursues these attributes.
There’s something in this video that’s incredibly important… compounding.. Our income is barely in the 20% bracket, while our net worth is solidly in the 5%… save, sacrifice instant gratification and “forget” about the money you’ve already invested. It’ll be there when you REALLY need it.
Diane, everything in life is relative! What is considered pocket change for some may be a fortune for another! For example, an income of $26, 000 may be at the bottom of the totem pole in America while that same amount may shoot one into the top ten percentile in many parts of Latin America, Africa & Asia! Little wonder why many retired Americans are relocating to the developing world where their dollar can stretch a bit farther!
Income, now retired, is not quite top 5% but close. Investments exceed pension. Not taking SS until I hit 70 years. Net worth is better than top 5%, about $3M. Live beneath your means and save, save, save. It makes all the difference. Thanks M&D!
While you focused on the income of the top 20%. And above as evidence of wealth disparity you need to also look at the total percentage of income taxes they pay
Duo to Trump's trickle down economics (TAX PLAN) 1.2 Trillion went back to the wealthy and the give keeps on giving. I smell urine from trickle down economics....YOU?
@@GJC-ih7cs But normally they don't pay that due to write offs, tax shelters, switching money overseas to other external business sites.....and more. My wife is a CPA and worked for some big companies. She walked away in discuss.
Well actually i am 48 and have a net worth of $15mln. It all depends on your spending and the yield on your net worth. I feel very comfortable and we can do everything we want, but we can't fly private and have 3 houses. But we can spend about $30k a month. So its very very comfortable
We could spend that amount, but we actually spend less than half of that because additional spending won't improve our lifestyle by much. Plus, we like to keep our tax liability relatively low.
The problem is that even when you are in the top 1%, you don't actually "feel" rich. In part because taxes and expenses grow at the same rate as income and net worth, and in part because 'rich' is only a state of mind, not a balance sheet.
@@WilliamMurphy-uv9pm - 50% of taxes is a hell of a lot. Only the richest pay that much, which is consequently MUCH more fair to average people, because there is NO way that average people could exist in the same tax bracket without being sent to the poorhouse .
@@scotthullinger4684 Why don't we ALL pay say a flat 10% of our income in taxes. Some fixed amount. Should "fairness" be based on ability to pay? ALL citizens are supposed to be equal in the eyes of government no matter what. Yet, the poor claim that the big payers always seem to be treated better. Then again, since they pay a lot more in terms of dollars, why shouldn't they get better treatment. People who pay more usually expect and get better treatment in life. Example: People flying first class get better treatment than those who pay for and fly economy class. Fairness is however someone wants to define the matter. If every citizen paid a fixed (equal) tax that would be fair to all but the poor would be screaming "unfair" because the rich have more money. Class warfare based on economic circumstances? Politicians have been using that for centuries to get votes. Perhaps government wants to maximize their "take" and "progressive" tax rates are the way to go even though they are hardly fair, in raw dollars, to the affluent. Robin Hood still lives in the hearts of the poor.
@@WilliamMurphy-uv9pm - Yes, but not quite. 10% of the income for TAXES a poor person is a HUGE portion of disposable income, whereas 10% for a very wealthy person is a comparable drop in the bucket. Fairness is a reference with regard to law, how we are treated in a criminal court of law when we have been charged with a crime. Fairness cannot be defined in the same way with regard to how much is paid in taxes. Fairness is NOT necessarily in how one chooses to define the matter. Your example regarding the airlines is asinine. It's not "unfair" for some people to have more money, because they earned it, or else they may have inherited money from family. Class warfare? Yes, politicians use it to get votes. But who employs it most? Only the LEFT. The Left is hell-bent on forever maintaining class warfare. It's their purpose and method, all accomplished by specific design. One of the MANY problems is that so-called Robin Hood mentality. Far too many poor people expect the government to constantly be Daddy Warbuck$ on their behalf, by getting freebies, by obtaining every UN-earned advantage for which such individuals have contributed nothing whatsoever. THAT is what's wrong with such a system -
Why can't they pay a comparable percentage as other people? Instead they often pay a lower percentage because of tax loopholes. If they can't pay a comparable percentage, regardless of if they are paying half of all taxes or not, it still isn't fair.
Income and net worth do not always align in this way. For example, my income is modest, just under top 20%, although net worth is in top 2-3% or so. So it’s unclear which metric takes precedence? Also, net worth is a result of assets that are not immediately liquid, so I feel secure, but not close to wealthy.
Would like to see you and others like you address the mobility of the American population across income and net worth quintiles over time. When I was 20 I was in the bottom 20% quintile earning minimum wage at a full time job, paying for college and had essentially a zero net worth. At 58, I am in the top 20% for income and in the top 5% for net worth. The fact is that most of the population is mobile over their lives and do not permanently occupy that bottom - and here's the secret a lot of people don't understand the top 20% - for long periods of time. Income inequality is a poisonous and loaded term and it assumes too many things that simply aren't true: 1. That most people in the bottom and top quintiles are permanent residents of those income/net worth levels. 2. That the inequality is the fault of the hard working and successful at the expense of the poor. (I know - it is a logical fallacy as well as being completely untrue. Poor people are poor because of behavior and the same is true of wealthy people) - 2a. Most wealthy people in fact do not inherit their wealth, they build it on their own. 3. That if the wealthy weren't so greedy, the poor wouldn't be so poor. - 3a. No amount of whining and moaning is going to make it moral or desirable to steal the fruits of Peter's labor to give to Paul through the coercion of any Local, State, or Federal government. Theft is theft whether your neighbor comes and steals your property or some government lacky does it. The WHY simply doesn't matter. Let's focus on the behaviors, habits, and outlooks of the successful and promulgate those traits across society rather than talking about "wealth inequality"
I have a net worth of the top 5% (not including home equity, just savings) but my income is only about 1/3 of that group. So I'm not sure what to make of these figures. I started investing when I got my first real job at age 28 (I'm almost 55 now). For most of my investing life, I put away 10-12% of my income (competing expenses like house, kids, etc.) but since I turned 50 I've been putting away 36% of my income and another $25K in after-tax income. Now that I've paid off my car, I plan to increase my savings rate to around 45%. My goal is to comfortably retire at age 60.
Concentrate on understanding your investments. Once you retire your sole income will be from your ability to allocate capital,enough to meet yearly expenses the rest compounding tax free. Be aware of the capital gains tax brackets and try to take advantage of the tax free bracket when possible.
Why not just retire now? Seems you have plenty already, well unless you absolutely love working. I did not and retired at 52. At some point your investments returns more than your job and time is your most precious asset as it is limited, not money. Who cares if you die with 10M or frankly nothing? What really matters to you is how you lived and your experiences. The meaning of life is to enjoy it as much as possible, don't waste it working. If you are doing something you don't really enjoy doing and don't need to be doing you are wasting your time.
@Uncommonsensetoo That's a legit question. I do enjoy my job. I have left corporate work and I do contract work as a consultant. I train and coach managers and leaders in a variety of well-known companies. It is a work model that allows me scheduling flexibility and an income that is still above my investment income. My net worth goals are also considering inflation and the fact that I hope to leave some to my family and/or donate to causes that I care about.
@@masterchinese28 Well, I suppose it depends on your situation. I would say though that focusing on a particular financial goal of 10M rather than on living your life to it's fullest is misguided in my opinion. I have no dependents so to me it made no sense to keep working. In fact, about 1/3 of my assets have accumulated in the 6 years after I retired due to rental income, and home/investment appreciations. I just love owning my time fully and can do whatever I want whenever I want. I go on trips for months at a time sometimes with no time limitation at all. I have no stress (which shortens life) and can spend much of my time focusing on staying in great shape with a healthy lifestyle and hopefully extend my life another 40-50 years.
I am 82 and I am in first 1%. Retired in 2010. Avg Salary less than $35000 of 40 years of working career. Most of my asset is from Stock market ( With Compounding Effect), very little from Real Estate. Also some income from Hard Money lending and Option writing. Some of the securities appreciated as high as 65000 to 75000%.
Would like to see a breakdown of the 2%-4% since we have 1% and 5%. We fall into that category and have worked hard to get there. Even though that is good, you'd be shocked at the costs involved with 2 kids about to start college, (assuming you don't want them to graduate with debt) 4 cars (kids need to drive,) insurance, retirement savings, taxes, and the massive inflation from this administration. It comes in, and flies right back out.
Keep in mind that by far, most of the income taxes are paid by the top 20%. Most of the top 10% got there the old-fashioned way by working hard for 40 years, living a frugal life, and investing 20% of their income every year. Nothing but the perverse and growing welfare system is stopping anyone else from doing the same.
I think it should be, whats the point of making 100k/200k a year if you don't have any assets. Also what if you have 1 million dollars in assets, but 700k is in a 401k, and 300 k in a brokerage/bank, and you don't have a job. You shouldn't be in the top 5 or 10% in my eyes
Many households in Hawaii who have paid off their homes have a net worth of $1M+ but their incomes may be considerably less than $100K/year - especially those on a fixed income. In other words, they're property millionaires but only have their savings and Social Security.
Interesting video. How does the top 10% make up 11% of the population? What is this 10% referencing? Is annual income Shown as net income or gross income.
Hi, Nice video. I have a question? Are the income and net worth figures you mentioned based on individual or household income? In other words, if my wife and I have a net worth equal to X, are your figures referring to X or 0.5X? Same question on Income. Thanks!
Not even, the global top 1% of earners are on 100,000$ or more whilst the top 20% in America are on 100,000$ or more, obviously in other countries their buying power might increase but that's crazy. The median global household income is like 2,350$ a year, whilst in America it's like 76,000$ so... Yeah
If you work for a salary then you must invest in mutual funds to securely grow wealth. You could buy real estate but that’s harder because you need a lot of money up front to get started.
Replace the word "individual" with "household" everytime she says it. As these results where based on household numbers, some that had 2 or more income earners in the household. And while generally single individuals do make more, the often work more and spend less until they are 50+ so statistics can be leveraged anyway we want to make them tell the story we want to see. The reverse needs to be shown more often, 80% of American households make under 60k a year, so congrats, your watching this and are likely the norm. There is nothing wrong with that.
Net worth amounts seem way too low for each category. I make $134K but have a net worth of $1.5M after 3 decades of working. A person or couple bringing in $343K should easily have a net worth of a few million in a shorter timeframe.
Another pertinent factor not considered or factored in for this study report is the household size. For example, a Married couple with or without children, a divorced or single with or without dependents, etc.
These stats are always confusing. For a family of four, is this income for each earner? Is that household income? Same for net worth - are these household numbers or for each soul in the family?
If you work in a STEM field and live below your means it's not that rare to be able to break into the top 10% income-wise, and as your investments grow to break into the top 5% as far as net worth goes. I'm not saying it's an easy thing. But many of the people I work with in a nothing-special as far as pay and benefits go software company are in that position. And you'd never know it, they drive older boring cars, they don't wear designer clothes (or if they do they it means scored big at the thrift store).
I'm top 5% wealth but hell, I'm also in 5% oldest as well! That makes sense as I was lowest 20% wealth back when I was in the youngest 20%.... Work and save, simple math!
One of the most important aspects in life, yet we rarely if ever have this conversation with friends or even family. Wether its because your embarrassed with how little you or how much you have. saved. All it leaves is people confused and making assumptions…..but maybe thats the whole idea.
With your data, those 22m Americans that are millionaires are defined as having more than 1m in net assets. The common international definition is that for HNWIs of having 1m in investable assets, I.e. without your own home. As every house in the US and most of Europe costs more than 1m now, that is quite a difference.
It's actually all over the place and probably higher as the wealthier you are the better at hiding your wealth is in an environment where more and more are struggling hence they are changing the rules. Numbers can only be factual when every transaction is automated but that will never happen. If the bottom 80% found out how underpaid they are.... well history has a way to repeat since it has always been the few who lead - or mislead.
The wealth number and income lever really depends on ones age…. a 21 year old is not going to make more then a 50 year old…. I’d prefer to see these averages spread out of age groups…. I’m in my 50s I certainly make more then when I was in my 20s… age bracket wealth is so much more important.. would love to see a video on that...
As a 75 yo, it is a little late for me to strive to accumulate a large wealth. I have always wanted to make this world a better place to live. The most crucial problem to solve is finding a new source of energy. Having a career in Analytical Chemistry, after retiring I found a high probability of finding a new source of energy. It is a reaction at the quantum scale, for splitting water.
Hmm, 1 in 100 people have ten million and over? But...where are those people? I have a feeling that...they're not regularly seen in public -- at the grocery store, etc.
It’s interesting how few people have 1 million in investable assets. The millionaire next door is about 5 million people in USA by this criteria if don’t count the house About 1.5 percent of population
Its interesting to me that the top 5% have huge income yet so little net worth, and what a huge jump it is from 5% to 1%... what does 2,3,4% look like?
@4:05, You described deca-millionaires as the entry point for the top 1% in networth, fair point as it represents household networth of over $10 Million. But then you immediately flashed pictures of Buffett and Gates.....those two guys are worth over $130 billion each in 2024, which makes the two of them worth 26,000 deca-millionaires put together. Those guys don't represent the top 1%, they are more like the top 0.000007%. The description isn't wrong, but the video is misleading. Perspective: Having $10M certainty allows you to live in comfort, even if you just take a conservative 4% withdrawal each year, you'd get $400K in spending money before taxes, but you're not paying cash for an NFL team like Buffett and Gates can do. The two of those guys combine can afford to buy all 32 NFL teams and not go hungry.
