Your 20s: See how your wealth measures up
This is a really interesting article
about us 20 somethings and money.
Older folks who are nostalgic about their 20s often forget, or gloss over, how very, very broke many people are at this age:
The median income for families headed by people aged 20 to 29 was just under $28,000 in 2004, according to Federal Reserve statistics, compared to medians of $48,000 for those in their 30s and nearly $58,000 for those in their 50s. One-third of twentysomethings made $20,000 or less.
Twentysomethings were more than twice as likely as older folks to have a negative net worth; one out of four families headed by people aged 20 to 29 owed more than they owned. The median net worth in this age bracket was just $7,901.
Thirty percent had education loans. The median amount owed to student lenders was $9,200.
One out of 10 families headed by twentysomethings was at least 60 days late on a bill. Only folks in their 30s had a higher delinquency rate, with nearly 12% 60 days or more late.
Thirty-two percent of twentysomething families had no health insurance, putting them at greater risk of catastrophic bills and bankruptcy in case of illness or accident. The proportion of uninsured families drops precipitously with age; 21.4% of those in their 30s, 16.8% of those in their 40s and 13.4% of those in their 50s lack health insurance.
Get your act together now
But there is also good news if you're in your 20s: Time really and truly is on your side. If you get your act together now, you can achieve financial independence decades ahead of your peers who keep muddling from paycheck to paycheck.
Consider this: Someone who puts $4,000 a year into retirement accounts starting at 22 can have $1 million by age 62, assuming 8% average annual returns. Wait 10 years to start contributions, and you'd have to put in more than twice as much -- $8,800 a year -- to reach the same goal.
about us 20 somethings and money.
Older folks who are nostalgic about their 20s often forget, or gloss over, how very, very broke many people are at this age:
The median income for families headed by people aged 20 to 29 was just under $28,000 in 2004, according to Federal Reserve statistics, compared to medians of $48,000 for those in their 30s and nearly $58,000 for those in their 50s. One-third of twentysomethings made $20,000 or less.
Twentysomethings were more than twice as likely as older folks to have a negative net worth; one out of four families headed by people aged 20 to 29 owed more than they owned. The median net worth in this age bracket was just $7,901.
Thirty percent had education loans. The median amount owed to student lenders was $9,200.
One out of 10 families headed by twentysomethings was at least 60 days late on a bill. Only folks in their 30s had a higher delinquency rate, with nearly 12% 60 days or more late.
Thirty-two percent of twentysomething families had no health insurance, putting them at greater risk of catastrophic bills and bankruptcy in case of illness or accident. The proportion of uninsured families drops precipitously with age; 21.4% of those in their 30s, 16.8% of those in their 40s and 13.4% of those in their 50s lack health insurance.
Get your act together now
But there is also good news if you're in your 20s: Time really and truly is on your side. If you get your act together now, you can achieve financial independence decades ahead of your peers who keep muddling from paycheck to paycheck.
Consider this: Someone who puts $4,000 a year into retirement accounts starting at 22 can have $1 million by age 62, assuming 8% average annual returns. Wait 10 years to start contributions, and you'd have to put in more than twice as much -- $8,800 a year -- to reach the same goal.