Smart Money Happy Hour: How Does Your Net Worth Compare to the Average American?
Podcast Information
- Title: Smart Money Happy Hour with Rachel Cruze and George Kamel
- Host/Author: Ramsey Network
- Episode: How Does Your Net Worth Compare to the Average American?
- Release Date: July 24, 2025
Introduction
In this insightful episode of Smart Money Happy Hour, financial experts Rachel Cruze and George Kamel delve into the topic of net worth, comparing individual financial standings against the median figures of average Americans. With a blend of personal anecdotes, statistical analysis, and practical advice, the duo provides listeners with a comprehensive understanding of where they stand financially and how to improve their net worth over time.
Personal Financial Journeys
Rachel Cruze’s Path
Rachel shares her financial journey, highlighting significant milestones achieved in her 20s and 30s. She emphasizes the importance of starting without student loan debt, thanks to her parents' support, which allowed her to build wealth early on.
“We were very much set up so well. So I see that as a huge head start in our money journey.”
— Rachel Cruze [04:15]
Key milestones in her 20s included getting married, buying a house during a recession, and starting a family with two children. These early decisions laid a strong foundation for her financial stability.
George Kamel’s Path
George contrasts his experience by detailing his struggles with debt in his 20s. Graduating with $36,000 in student loans and $4,000 in credit card debt, he shares his rapid turnaround, paying off all debt within 18 months through side hustles and strategic financial planning.
“Most people overestimate what they can accomplish in a year. They underestimate what they can accomplish in a decade.”
— George Kamel [08:20]
George’s journey from negative net worth to millionaire status in a decade serves as a testament to disciplined saving and investing.
Net Worth Statistics by Age
Rachel and George break down the median net worth of average Americans across different age groups, providing a stark comparison to their personal successes.
35 and Under
- Median Net Worth: $39,000 (2022)
- Quote: “If you're listening to the show, you're probably on the right track, if you know what I mean.”
— Rachel Cruze [02:55]
This figure has more than doubled from $16,230 in 2019, indicating gradual improvement. Strategies to increase net worth in this age group include eliminating consumer debt, establishing an emergency fund, and beginning to invest.
35-44
- Median Net Worth: $135,300
- Quote: “At 44, to have a $100,000 net worth, it still shows me that you're not investing enough.”
— George Kamel [18:17]
Although a significant increase from the previous decade, George highlights that many in this group may still struggle with insufficient investments and debt.
45-54
- Median Net Worth: $246,700
- Quote: “Birthday money should probably be more than $40.”
— Rachel Cruze [15:54]
This age group sees a substantial increase, yet George points out that many may not be investing adequately to secure a comfortable retirement.
55-64
- Median Net Worth: $364,270
- Quote: “At 60, you're in your early 60s and you don't have much to show for it... You've worked your entire life, 40 years now, and you don't even have a few hundred thousand in retirement account.”
— George Kamel [22:35]
While nearing retirement, the median net worth suggests that many Americans may not be fully prepared financially, often relying heavily on home equity and having limited retirement savings.
65-74
- Median Net Worth: $410,000
- Quote: “Your net worth is and you're 20, you know.”
— George Kamel [26:50]
At this stage, the peak median net worth shows slight decline beyond 75 years, emphasizing the importance of adequate retirement planning earlier in life.
Strategies to Improve Net Worth
Rachel and George outline actionable steps to enhance one’s net worth, applicable across various age groups:
-
Eliminate Consumer Debt
- Prioritize paying off high-interest debts to free up financial resources.
-
Establish an Emergency Fund
- Save three to six months’ worth of expenses to safeguard against unexpected financial setbacks.
-
Invest Wisely
- Allocate at least 15% of income towards retirement accounts to leverage compound growth over time.
-
Build Home Equity
- Investing in property can significantly contribute to net worth as the property value appreciates.
“Once you get older, it's not that you can't, it just gets harder.”
— Rachel Cruze [23:57]
These foundational steps are crucial for building and maintaining a healthy net worth, enabling financial security and growth.
Digital Privacy and Financial Security
The episode also touches on the rising threat of financial fraud and the importance of protecting personal information online.
“Delete Me goes in and removes that information from these data broker websites.”
— George Kamel [21:20]
Rachel and George discuss the increasing instances of fraud, phishing attacks, and the necessity of services like Delete Me to safeguard personal data, thereby minimizing financial risks.
Reflections on Aging and Financial Goals
As Rachel and George reflect on their personal lives in their 30s, they emphasize setting meaningful financial goals beyond mere numbers. They advocate for goals that enhance life quality, such as buying a pool or traveling, rather than chasing arbitrary net worth milestones.
“We don't want money to be the center part of your life. So how do you create a sense where you have it under control and then it is a tool, it is the thing that helps you live your life. It's not your life.”
— George Kamel [36:43]
This perspective encourages a balanced approach to wealth, where money serves as a means to enrich life experiences rather than becoming an end in itself.
Conclusion
In conclusion, Rachel Cruze and George Kamel provide a thorough analysis of average American net worth across different age groups, contextualizing it with their personal financial journeys. They offer practical advice on debt elimination, savings, and investments to help listeners improve their financial standing. Additionally, they highlight the importance of digital privacy and setting meaningful financial goals that enhance life quality.
Notable Quotes:
-
“Comparison is the thief of joy, but also, how do you stack up against the average American financially?”
— George Kamel [00:05] -
“The older you get, the harder it is to undo a lot of this and to make progress.”
— George Kamel [23:57] -
“Money is a tool to bless others, to impact your family, to be generous, to live your best life.”
— George Kamel [36:31]
Key Takeaways:
- Early Financial Planning: Starting without debt and investing early can significantly enhance net worth through compound growth.
- Debt Management: Prioritizing debt elimination is crucial for financial health.
- Investment Strategies: Consistent saving and investing, particularly in retirement accounts, are vital for long-term financial security.
- Digital Security: Protecting personal information online is essential to prevent financial fraud.
- Balanced Goals: Setting financial goals that improve life quality rather than chasing arbitrary numbers leads to greater fulfillment.
By understanding these principles, listeners can better assess their financial standing and take proactive steps towards achieving a secure and fulfilling financial future.