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When I started calculating my net worth many years ago (just prior to starting this blog I believe in 2009) I was excited, and I still am excited when I do the calculations every month. It's a way for me to keep accountable with my personal finance journey to create my own Findependence Day some day. One of the first inspirations was Million Dollar Journey when he shared his progress towards having a net worth of one million dollars before the age of 35. Since then, he has successfully completed his journey this year, starting from $200,000 in 2006 and hitting the magic number in 2014. His blog has been undoubtedly an inspiration to my own journey of financial freedom. He is like my personal finance idol.
Related: Book Review: Findependence Day
Although I did not compare my net worth with his even from the very beginning (he is very much ahead in the financial independence game) I did look at it as inspiration (hence the personal finance idol title). I highly doubt I will have a million dollar journey completion myself at age 35, but maybe in my 40's it may happen.
Comparing Your Net Worth
Is comparing your net worth to others a good idea when you are possibly comparing apples to oranges? Everyone has a different income, different investing style, different spending style, and different cost of living…right?
Recently I stumbled upon this page full of net worth voyeurism via J. Money from Budgets Are Sexy to many personal finance bloggers who track their net worth on a regular basis, just one click away to reveal the net worths of your favourite personal finance Internet personalities.
I must admit, when I saw some of the net worth results on that page, my eyes bugged out a little and perhaps my jaw dropped to the table for a second. A few personal finance bloggers have some stealth, well-over $1,000,000 net worth updates. My first gut reaction was…**gulp!**… hey, I thought I was doing pretty good for my age… then I proceeded to feel insecure and thought I should really be doing better.
So, my conclusion is that everyone reacts differently when they compare themselves to others. For something that you can change, I think that comparing can be a healthy way to improve yourself. However, for something that you cannot change, there isn't much point to compare and make yourself feel worse than you are.
So my response is… brush my ego off a little bit and keep calm and carry on!
Set goals for yourself that you can keep and when you achieve your goals, you will free great no matter what everyone else is doing.
How Much Should Your Net Worth Really Be?
Well, Liquid from Freedom Thirty Five blog has a great post on net worth and what the median and average net worth results are for people in Canada, in the United States, and for people who are singles are those who are couples (established) and couples who are just starting out.
I found it quite interesting to read that there are about 320,000 Canadians with $1 million in financial assets (not including their principal residence), which means that about 1% of Canadians are millionaires. I bet that number is much larger if you count principal residences because I know that many people who live in the greater Vancouver area are sitting on their properties and who have paid off their mortgages.
The average household net worth in 2013 for Vancouverites is over $700,000. Target net worth for singles at age 30 (I am around there, yes, single and 30-something, not so young anymore haha) is $20,000 for sufficient, $60,000 for good, $250,000 for excellent, and $600,000 for rich. As someone who strives for completion of goals, knowing this information is helpful to see where I stand and to see what the benchmark might be around.
I suggest you go to Liquid's post to check out the detailed graphs and excel charts on expected net worth. Either it will make you feel better or it may may you feel like **gulp** and prompt you to action.
Keep Calm and Financial Independence On…right? 🙂
Readers, do you calculate your net worth monthly? Do you enjoy the voyeurism behind looking at others grow or shrink their net worth as time goes by like I do?
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