When can you ditch your 9 – 5? Let’s find out your net worth target by age!

net worth target by age 2

Having a net worth target by age is the kind of right of passage every adult should go through.  Targets, in general, are awesome.  They give you a goal to work for.  Help you stick to your plans over time.  And motivate you to work harder!

From one day to the other, you can go from saving just for the sake of it to saving to reach a certain number and goal.  And once you see your pile of cash grow, it will motivate you to keep on saving and, very likely, to save more than you initially had planned.

What if you only had to figure out 1 thing to be on your way to an amazing retirement

Related: How I Doubled My Income In 4 Years

The question on everyone’s mind though is how much your net worth target by age should be.  This question very much depends on your income.  No surprise there.  But no matter what your income, it is important to set a target for yourself.

Targets Win

Net Worth Target by Age
If you make $50,000 per year

If you make $50,000 a year, saving can be tough but doesn’t have to.  The key at this income level is to keep your expenses as low as you possibly can.  Additionally, either picking up a side hustle or working hard for a raise at work are good goals to have.

net worth target by age 50k income

If you can manage to put aside just 10% of your income starting age 25 and invest it, you will accumulate close to $700,000 by the time you are ready to retire.  This is assuming a 5% return rate and considering 3% inflation.

But what if you can save more than 10%?  Let’s say you forgo the brand new car, latest iPhone, and cruise and save 20% of your salary instead.  Your savings balance at the “end of the road” would be $1.3 million.  Plenty to retire comfortably.

Related:  The 4 % Rule: The opening bid of how much money you need to retire comfortably!

Net Worth Target by Age
If you make $75,000 per year

If you make $75,000 a year, saving isn’t as tough as it is for others in lower income brackets.  That doesn’t mean however that money flows freely.  Expenses such as kids and a home can severely diminish your saving capabilities.  But only if you let it!

net worth target by age 75k income

Saving “only” 10% of your salary will amount to $1 million dollars by the time you turn 65.  That amount of money paired with social security and possibly a pension will allow for a nice retirement.  But what if you decide to skip the fancy car or mega house?

Saving money on everyday purchases is key to driving up your savings rate.  Do you really need the luxury car or five bedroom mansion?  Downsizing your expenses and driving your savings rate to 30% will leave you with $3 million when 65 years old.

Or, if you feel that $1 million is plenty to ditch your 9 – 5 and pursue the life you actually want to live, you could retire early.  By saving 30%, retirement is within reach shortly before your 50th birthday.  A full 15 years sooner than most people!

Related: So you have not saved for retirement so far?  Here is how to turn the tide!

Net Worth Target by Age
If you make $100,000 per year

Reaching six figures in salary isn’t an easy feat.  At this level of income, college degrees are mandatory 99% of the time and a certain level of work experience is usually required as well.  Nevertheless, your savings potential in this range is amazing.

net worth target by age 100k income

Saving just 10% of your salary shouldn’t hurt your lifestyle too much at this point.  Unless of course, you like to live in your mansion by the ocean, with an R8 in the driveway, and caviar in the fridge.  In which case this blog probably is not for you 😉

If you manage to drive your savings rate up to 30%, you are going to accumulate your first million before your 45th birthday.  At 40%, you would shave close to 25 years of your working years.  That’s hard to beat!

Related:  The definite guide to retirement savings account types – all in one place!

Net Worth Target by Age
If your salary increases over the years

Most of us don’t start out at $50,000 and forever remain at that salary.  Neither is the case for starting out at $100,000 (excluding our lawyer, doctor, and banker friends) and remaining in this income bracket for all eternity.

Many, including myself, start out in a lower income bracket and work their way up the salary ladder.  The below table shows that type of progression. Using a starting salary of $50,000 as an example. Ten years later, this example assumes a salary increase to $75,000 and yet another ten years later to $100,000.

net worth target by age mixed income

With a steadily progressing salary of this kind and a steady savings rate of 10%, you will end up a millionaire at age 65.  If early retirement is on your mind and you can cut your expenses to boost your savings rate, you are looking at ditching your 9 – 5 much sooner!

Related: What your retirement savings goals by age should be!

What is your net worth target by age?

Reaching financial independence is a true possibility for anyone who is willing to set their net worth target by age and is then disciplined enough to stick to the plan! That includes you!

Imagine what you could do with your life if you could ditch your 9-5,  Could you pursue another career?  A hobby you have always been interested in?  Or could you stay home with your children?

So many possibilities open up once you are not shackled to a traditional 9-5 any longer.  Yes, we all need money.  And that is why we get up and go to work every day.  But what if you could save enough money to get up every morning for you and no one else?

It is a true possibility.  At all times, keep your expenses as low as possible. All while driving up your disposable income wherever and however you can. May this be via side hustles or working for promotions and raises at your day job.

What is your income level and what savings rate do you think you will be able to achieve?

Check out this complete listing of all posts for more personal finance must reads!

8 thoughts on “When can you ditch your 9 – 5? Let’s find out your net worth target by age!

  1. I sit between the $50k – $100k bracket but have only just started saving in earnest this year. I feel so ashamed of that but I’m telling myself it’s better late than never! So far, since I started my PF journey, I have managed an above 40% saving rate every month and fingers crossed that will be the norm from here on out!

    • Financial Muse says:

      Let the past be the past and let go of all negative feelings about what you could have done. What counts is that you started to save! And your 40% savings rate is awesome!!

  2. Great content. I always enjoy reading posts with charts about how much your net worth should be by a certain age and income. Your last graph was helpful. Most people start out with a lower salary and it increases with career advancement. I found that graph to be an especially helpful guide.

    • Financial Muse says:

      Great, glad it helped. And I agree, most people experience a gradual incline in salary vs jumping into the working world at a six figure salary. That is wishful thinking for most.

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