Net worth is a pretty quick and easy way to check your financial health. To find it, you add up the value of all your assets and then subtract any debt you have. For example, if you have $100,000 in retirement accounts and a $400,000 house, but also $300,000 in debt, your net worth is $200,000.

While net worth isn’t everything, it can give you an idea of ​​where you stand compared to your peers. Below you will find the average net worth in the United States.

The Net Worth of the Average American

The median net worth is $192,700, according to the Federal Reserve’s 2022 Survey of Consumer Finances. But that doesn’t take into account age, which plays a significant role in a person’s net worth. It would not be fair to compare a 30-year-old to a 50-year-old, because the latter has had an extra 20 years to build wealth.

Here is the median net worth for each age group:

• Under 35 years old: $39,040
• 35 to 44: $135,300
• 45 to 54: $246,700
• 55 to 64: $364,270
• 65 to 74: $410,000
• 75 years and over: $334,700

If you are 40 years old and your net worth is $175,000, your net worth is above average for your age. If you are this age and have $100,000, your net worth is below average. Now let’s see how to increase net worth.

How to increase your net worth

Most people’s net worth rises and falls because it is largely based on the value of their retirement accounts and their homes. This is normal, but in the long term, your net worth should tend to increase. You can do this by following a few key financial habits.

Pay yourself first

The best way to save money is to be proactive. Instead of saving what’s left at the end of the month, transfer money to your savings account right after you receive your payment. You can even automate this to make things easier.

To get the most out of your savings, make sure to keep them in a high-yield savings account. These earn rates well above the national average, and one of the best options is the Western Alliance Bank High-Yield Savings Premier account. Click here to learn more and open an account today.

Invest regularly

Investing is the most reliable way to build long-term wealth. You can invest through a 401(k) plan at work, by opening an individual retirement account (IRA), or through a brokerage account. Or, you could do all three. These types of accounts allow you to invest your money in assets that have the potential to grow, like stocks and bonds.

If you want to open a traditional brokerage account or an IRA, consider Robinhood. This is a user-friendly stock broker with $0 commissions on stocks and ETFs. Learn more and open an account here.

Avoid Credit Card Debt

Growing your net worth also involves avoiding unnecessary debt, especially debt with high interest rates. One of the most common examples is credit card debt. The Federal Reserve recently reported that the average rate for credit card accounts on which interest is assessed is 23.37%.

It’s okay to use credit cards. In fact, top credit cards like these can be a great way to earn points or get money back on your spending. But make sure you pay your credit card bill in full each month to avoid interest charges. If you currently have credit card debt, do what you can to pay it off as quickly as possible.

A useful measure of your financial health

It may be interesting to see if your net worth is above or below average. But it’s how your net worth changes over time that’s really important. If it generally increases from year to year, that’s a good sign. If it’s down, find out why to see if there’s something you need to fix.

You can track your net worth yourself or there are personal finance apps that will do it for you. Whatever you choose, don’t worry too much. Checking your net worth every three to six months is more than enough.