Where does the age × income ÷ 10 formula come from?

It’s inspired by the rule of thumb popularized in The Millionaire Next Door and similar planning guidance. This calculator adapts that idea for a 2025 context, but it remains a rough benchmark, not a precise requirement.

Are the percentile numbers based on real survey data?

They are illustrative and smoothed using age-band anchors, not real-time microdata. For precise statistics, rely on official surveys like the Survey of Consumer Finances (SCF) or CPS and tools built directly from those datasets.

Should I include my home, business, or rental properties in net worth?

You can, but be consistent. Many people include home equity and investment properties while valuing businesses conservatively. The key is to compare apples to apples over time and to be realistic about what can fund future goals.

What if I’m far below the expected wealth target?

Being below the benchmark doesn’t mean you’re doomed—it simply signals that you may need higher savings, more time, or adjusted expectations. Use this as a prompt to build a more detailed plan rather than as a judgment.

finance calculator

Wealth / Savings Comparison 2025

Compare your net worth to a 2025-age-based benchmark (age × income ÷ 10) and see an illustrative percentile score by age band.

Results

Expected wealth (age × income ÷ 10): $320,000
Wealth gap (actual − expected): -$120,000
Illustrative wealth percentile: 6777.78%

How to use this calculator

Enter your age, annual income, and estimated net worth.
We calculate the expected wealth target for your age and income using age × income ÷ 10.
We compute your wealth gap as actual net worth minus expected wealth, highlighting whether you are above or below the rule-of-thumb target.
We estimate an illustrative wealth percentile by comparing your net worth to a simplified age-band distribution.
Review the numbers, then adjust income or net worth scenarios to see how your gap and percentile might change.

Inputs explained

Age: Your current age. The age × income ÷ 10 benchmark and age-band percentile anchors both depend on your age group.
Annual income: Your current gross annual income before taxes. If income is volatile, a multi-year average can provide a smoother benchmark.
Net worth: Assets minus debts, including home equity, investment accounts, retirement accounts, and cash savings. Exclude assets you do not plan to tap for long-term wealth if you want a more conservative comparison.

How it works

We first calculate an "expected wealth" target using a Millionaire Next Door–style rule of thumb: expected wealth = age × income ÷ 10.

We then compute your wealth gap by subtracting this expected wealth from your actual net worth; a positive gap means you’re ahead of the rule-of-thumb target.

To provide context, we map your net worth into a simplified age-band distribution using anchor points like median and 90th-percentile figures for your age group.

Based on where your net worth falls between those anchors, we estimate an illustrative percentile score—an approximate indication of how you might compare with peers in your age band.

All benchmarks and percentiles here are illustrative and smoothed for educational use, not real-time survey statistics.

Formula

Expected wealth = Age × Income ÷ 10\nWealth gap = Net worth − Expected wealth\nPercentile ≈ f(Net worth, Age band) using simplified median and 90th-percentile anchors for each age group.\n\nThe percentile function is an illustrative mapping, not a direct lookup from live survey data.

When to use it

Benchmarking your net worth against a 2025 rule-of-thumb target that adjusts for both age and income.
Illustrating for clients, students, or friends how their savings compare to peers in a simple, visual way.
Checking whether a planned lifestyle or early-retirement idea is supported by current savings levels relative to basic expectations.
Tracking your position over time by updating the inputs annually and seeing whether your gap and percentile move in the right direction.
Using the expected wealth target as a conversation starter before building a detailed, personalized financial plan.

Tips & cautions

Treat the age × income ÷ 10 formula and percentile as rough guidelines, not pass/fail scores—many successful savers will be above or below these rules of thumb at different life stages.
If your income has been unusually high or low in the last year, try using an average of the last few years to avoid distorted benchmarks.
A large negative gap does not automatically mean you are in trouble; high earners who start late, business owners reinvesting in a company, or people with significant pensions may look "behind" by this metric.
Consider running projections with a dedicated wealth or retirement calculator if you are far ahead of or behind the benchmark to see whether your current trajectory supports your actual goals.
Remember that market swings can move your percentile and gap in the short term—focus on long-term trends rather than month-to-month changes.
Uses a simplified wealth benchmark and age-band anchors; it is not based on live or detailed survey microdata.
Does not adjust for household size, geography, profession, or other factors that heavily influence what a "comfortable" net worth looks like.
Assumes income and net worth are reported honestly and consistently; large one-time events or illiquid assets can distort comparisons.
Provides a snapshot comparison only and does not model future savings, investment returns, or inflation.

Worked examples

Age 40, income $80,000, net worth $200,000

Expected wealth = 40 × $80,000 ÷ 10 = $320,000.
Wealth gap = $200,000 − $320,000 = −$120,000 (behind the rule-of-thumb target).
If the age-band median is around $150,000 and the 90th percentile is $600,000, a $200,000 net worth might land near the 60th–70th percentile.
Interpretation: you’re below the age × income benchmark but still above the median for your age group in this simplified model.

Age 30, income $60,000, net worth $90,000

Expected wealth = 30 × $60,000 ÷ 10 = $180,000.
Wealth gap = $90,000 − $180,000 = −$90,000.
If many 30-year-olds have little net worth, $90,000 may still place you comfortably above the median—even if you’re below the strict rule-of-thumb target.
Interpretation: you may be behind the age × income benchmark but ahead of many peers, which can guide how aggressively you need to save.

Age 55, income $120,000, net worth $1,200,000

Expected wealth = 55 × $120,000 ÷ 10 = $660,000.
Wealth gap = $1,200,000 − $660,000 = +$540,000 (well ahead of the benchmark).
Your percentile may be high in the simplified distribution, suggesting strong relative savings.
Interpretation: you’re ahead of both the age × income guideline and many peers, but you should still confirm that this supports your specific retirement lifestyle goals.

Deep dive

Compare your net worth to a 2025 benchmark using the classic age × income ÷ 10 rule plus an illustrative wealth percentile by age band.

Enter your age, income, and net worth to see expected wealth, your wealth gap, and an approximate percentile score versus peers.

Use this wealth/savings comparison calculator as a quick sanity check before diving into more detailed retirement and financial planning.

FAQs

Where does the age × income ÷ 10 formula come from?: It’s inspired by the rule of thumb popularized in The Millionaire Next Door and similar planning guidance. This calculator adapts that idea for a 2025 context, but it remains a rough benchmark, not a precise requirement.
Are the percentile numbers based on real survey data?: They are illustrative and smoothed using age-band anchors, not real-time microdata. For precise statistics, rely on official surveys like the Survey of Consumer Finances (SCF) or CPS and tools built directly from those datasets.
Should I include my home, business, or rental properties in net worth?: You can, but be consistent. Many people include home equity and investment properties while valuing businesses conservatively. The key is to compare apples to apples over time and to be realistic about what can fund future goals.
What if I’m far below the expected wealth target?: Being below the benchmark doesn’t mean you’re doomed—it simply signals that you may need higher savings, more time, or adjusted expectations. Use this as a prompt to build a more detailed plan rather than as a judgment.

Related calculators

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Wealth Calculator (Millionaire Next Door)

Benchmark your net worth using the classic Millionaire Next Door expected wealth formula (age × income ÷ 10) and see your gap.

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Wealth Percentile Score

Estimate a rough wealth percentile score by age band using simplified median and 90th-percentile net worth benchmarks.

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Savings Comparison (2025 Benchmark)

Compare your savings to an age-based 2025 benchmark using income multiples to see your gap or lead.

This wealth/savings comparison calculator is for educational illustration only. The benchmarks and percentiles are simplified and not based on current, individualized survey data. It does not provide financial advice and should not be used as the sole basis for retirement, investment, or lifestyle decisions. Always consult up-to-date data and a qualified professional for personalized planning.