man holding 1 US dollar banknote

How much should you have saved in your 30s,40s and more?

There are far too many blog posts talking about what your ideal networth should be in your 30s, 40s and more. I do not find a good mathematical basis for it, some of us are late bloomers and others early.

Today I found a study which gives actual baselines in Germany. The graph details out Net Worth according to age brackets in Germany. It is based on a study by IW Cologne. It is not a ‘goal‘ recommendation but a commentary on how things stand today.

What is measured on the Net Worth?

The study (released in 2020) is an evaluation based on 2018 numbers for household Networth i.e. Assets – Liabilities. Here Assets include insurance, bank savings, real estate, insurances etc… and Liabilities include any debt like mortgage, student loans and consumer loans.

Compare your Net Worth

How do you compare your Net Worth against others?

So, lets say you are in my age group, and fall in the 35-39 bracket. In this case, the 50% percentile falls at the Net Worth of 45 800 EURs that is exact in the middle of all people survyed of that age bracket.

At the same time, if you were at the 90% percentile of the 35-39 age group, then your NW would be around 312 000 EUR. This is a difference of 7 times against someone in the middle!

Now, people can go up and down this graph, depending on how they progress in life stages or say buy a house and incur new debt. We also do not know the impact of inheritance specially for those in their 50s (who are at a peak of Net Worth).

My suggested takeaways;

  • The lower the percentile one falls in, the flatter the graph is i.e. if you were at 40% percentile in your 30s (21 800 EUR), you still do not cross the 100k market in your 50s unless you move up.
  • Wealth Gap: The Gaps between 70th percentile and 90th percentile widens disproptionally compare to other groups. It might be an indicator for more investment income and definitely more savings.

Both above, perhaps, also mean that Social mobility (upwards mobility) is very limited.

Also, if you are even more curious to compare your income levels too, then I did a post on checking how wealthy you are based on your Income in Germany

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