Net worth is a fairly quick and easy way to check your financial health. To find it, 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 home, but also $300,000 in debt, then 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 big 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 20 more years to build wealth.

Here is the median net worth for each age range:

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

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

How to increase your net worth

Most people’s net worth goes up and down because it is largely based on the value of their retirement accounts and their homes. This is normal, but over the long term, your net worth should trend upwards. You can make this happen by following a few key financial habits.

Pay yourself first

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

To get the most out of your savings, make sure you have them in a high-yield savings account. These rates earn well above the national average, and one of the top 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 can grow, such as stocks and bonds.

If you’re interested in opening a traditional brokerage account or an IRA, consider Robinhood. It’s an easy-to-use stock broker with $0 commissions on stocks and ETFs. Learn more about it and open an account here.

Avoid credit card debt

Increasing your net worth also depends on avoiding unnecessary debt and especially high interest debt. One of the most common examples is credit card debt. The Federal Reserve recently reported that the average rate for credit card accounts that carry interest is as high as 23.37%.

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

A useful measure of your financial health

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

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