Bench-marking Net Worth by Age, Income, and Location

Humans go through major phases in life. There are expectations placed on a person from the moment they are born. During a typical lifetime, a person is expected to learn how to walk, get an education and graduate from school, start off with a good job after school, get married, buy a house, have kids, raise the kids the right way and instill wisdom, achieve career advancement, look out for family, be a guide to those younger, and finally retire from the workforce. While all these benchmarks are being met, one thing that is constant throughout at almost any age is achieving financial freedom. It is not incredibly difficult to measure where one stands as the concept of “financial net worth” i.e. Assets – Liabilities can be a powerful tool, however, it can be tricky because it is important to benchmark net worth with the right variables. It really does not make sense for a 21-year old who just got out of college to be compared to a 40-year who is right around the peak of their high-earning years.
When determining where one falls, the variables that need to be considered are age, income range, location, and possibly credit score range. The reason I mention credit score range is because it is important to benchmark oneself with those who are financially aware of their situation and usually try to make sure they are placed in the best financial position in case an opportunity shows up. Status Money, a personal financial management online tool co-founded by an ex-Goldman Sachs employee, provides a platform that helps compare your net worth to those within your peer group. A peer group in this case is defined by age, location, income, credit score, housing situation, and location type. The company was founded in May 2016 and has well over 30,000 registered users.
Status Money is free to use and the tool updates and performs calculations showing peer comparisons including income, spending, credit profile, assets, debts, and net worth. A percentile rank is also calculated with where one falls within each peer group and the national average. The tool offers other benefits outside of just peer comparisons, you can analyze your cash flows and view future projections based on your transaction patterns. You find out if your interest rates are higher than the rates of people with similar scores. This is valuable as this can lead to a recommendation of refinancing your mortgage for example and possibly save you hundreds of dollars. Finally, Status Money gives actionable insights by recommending personalized opportunities to save, earn smarter, and grow your net worth.
Status Money is free and easy to get started with. It is a comprehensive platform similar to Personal Capital (which is also free). Status Money has an added benefit of comparing your finances with your custom peer group thereby providing insights in where you realistically stand and recommendations on opportunities available out there that can optimize your finances. It uses machine learning algorithms to proactively find opportunities for members to save and earn smarter. Be it either Status MoneyPersonal Capital and M1 Finance – there are free tools available to help you grow your wealth and lead you on your path to financial freedom.

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