Expected Level of Wealth |
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| Simple, rule-of-thumb method for defining whether or not a person, household, or family is on their way toward achieving a high net worth. Determinants include a person's income and age. Theoretically, the higher one's income, the higher his net worth is expected to be. And the longer one is generating income, the more likely he is to accumulate wealth. The figure resulting from this formula should approximate your net worth IF you are on track for complete (and early) financial independence. | |||
| Formula | ((Annual Household Pre-Tax Income) − (Inheritances)) * (Age) / 10 | ||
| Source | The Millionaire Next Door | ||