So after finding out I could read the April issue of Money magazine for free, I did. One of the good articles inside was one titled "How Normal Are You?" which basically tells you about the "Medians," a fictitious family from which you can draw comparisons to your own. They do have a caveat: Americans don't save enough, the Medians should really be the "Bare Minimums." (Haha, yeah the bad play on words was my own creation) The beauty of the article is that you can compare your own statistics with the Medians in the privacy of your own mind. (Definitely read the article and enjoy the Sims-like images, it also goes into greater detail than I do below)

"Springboard Years" - 25-34 years old
The statistic that surprised me the most was that the average net worth of someone in this period was only $15k. The average salary was an expected and respectable $45k. The advice in this phase is to save as much as you can afford, which makes sense because compounding interest is a monster. The averages for 401k balances and savings are a lot smaller than I expected.

"Pressure Cooker Years" - 35 - 45 years old
Net worth rises to $94k and the average salary is $55k. They found that this is when people start thinking about retirement and saving more of their money. People start owning homes and putting away parts of their salary for the 401k. I think this is pretty accurate because this is when your salary starts exceeding your expense by a comfortable enough margin for a lot of folks.

"Wealth Years" - 55 - 64 years old
Net worth of $217k with earnings of $67.5k. The big difference now is that estate planning comes into play for a lot of people now, over half have life insurance and a will. It's getting near retirement so they say move into more conservative investments.

"Retirement Years" - 65+ years old
Net worth falls to $199k with a salary of $32.5k, predictable since you'll be retired living off pensions, 401k's, and children. :) Interesting stat? Social Security covers 44% of retiree income (can we expect that in 40 years?). 10% savings, 27% retirement plans, and 19% of "other" covers the rest of the income.

My Thoughts:

I tried to avoid rehashing the article (I couldn't help repeating net worth and salary values) and give my own input in most places. I think the age ranges are a little too broad and would've been better served in 5 year intervals if they could've helped it, especially in the earlier years. A 35 year old's financial issues are significantly different than a 45 year old's. The article mentioned about how American savings are dwindling (Greenspan has mentioned it as well) and that tone underscores the entire article, which is to save as much as you can.

So, how do you stack up? Don't be shy. :)

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