A new study from Schwab provides the answer.
Financial services giant Charles Schwab released the latest edition of its annual Modern Wealth Survey, which examines Americans perspectives on wealth, investing, saving and spending.
A key question in the survey, conducted for Schwab by Logica Research, asked participants how much they’d need to amass in personal net worth to be financially comfortable.
Personal net worth is a calculation of all your assets – real estate, bank accounts, stocks, retirement accounts, etc – minus liabilities.
Respondents, on average, said it would take $839,000 to be financially comfortable. This is up from $778,000 in 2024, but down from approximately $1 million in 2023.
The survey also probed how much net worth it would take to be considered wealthy. Respondents said $2.3 million, down from $2.5 million last year, but up from $2.2 million in both 2023 and 2022.
When asked about the key impediments to wealth, about 73% cited the impact of inflation while 62% mentioned a slowing economy and 48% called out higher taxes. Further, 43% percent said higher interest rates.
“The concept of wealth can feel distant, abstract, or even aspirational, while financial comfort is something people might see as more tangible and associated with the everyday realities they’re facing right now,” Rob Williams, managing director of financial planning at Charles Schwab, said. “It can be hard to navigate these concepts side by side in the form of short- and long-term financial goals. But both are important when it comes to understanding and managing your full financial life.”
Financial targets differ by age
While $839,000 was the overall average, the amount needed to be financially comfortable differed by age and generation.
Specifically, Boomers said they needed $943,000 to be financially comfortable, the highest amount of all the cohorts. Interestingly, for Millennials, the average was $847,000, which was higher than the average for Generation X, which was $783,000.
Not surprisingly, Gen Z, fewer of which have families at this point of their lives, had the lowest average at $329,000.
How many Americans are financially comfortable?
So, where are Americans on the road to being financially comfortable?
Only about 20% say they are already financially comfortable while another 28% say they are on track for that goal. Another 25% say they will need to make changes to be comfortable.
In addition, 11% say they are already wealthy while another 24$ say they are on track to be wealthy. Further, 26% said they will need to make changes to become wealthy. By generation, 43% of Gen Z respondents and 42% of Millennials are confident that they will achieve wealth or already have. In contrast, just 33% of Gen X and 20% of Boomers say the same.
Gen Z has a plan
Finally, 31% of those surveyed said they have a financial plan, while 36% have thought about it and 33% don’t have one and haven’t considered it. Surprisingly, 39% of Gen Zers have a plan, which is the highest percentage among the generations. Millennials were next at 36% followed by Gen X at 27% and Boomers at 26%.
Further, only 18% of Gen Z didn’t have a plan compared to 25% of Millennials, 36% of Gen X, and 45% of Boomers.
“It’s encouraging to see that young people recognize the value of planning,” Williams said. “Having a written financial plan not only helps people define what wealth means to them but also gives them a roadmap to get there. Especially in uncertain times, planning can help turn aspiration into action.”
The survey polled a representative sample of 2,000 Americans between the ages of 21 and 75. It was conducted between April 24 and May 23.
