Financial planning by decade.
What to focus on at each stage of life.

Where the average household stands by age (Federal Reserve SCF 2022)

US figures. Other countries use different statistical frameworks; the Federal Reserve Survey of Consumer Finances is the authoritative US source.

These figures are median net worthnet worthEverything you own (assets) minus everything you owe (debts). The most comprehensive measure of financial health.Full definition - the middle of the distribution - from the Federal Reserve's 2022 Survey of Consumer Finances. They are the most authoritative US net-worth-by-age data available, with the next survey (SCF 2025) expected in late 2026.

The overall average is approximately $1.06 million. The gap between median and average is the headline finding: a small number of very-high-net-worth households drag the average up dramatically. The median is the honest number for what the household in the middle has. The average flatters because a few very large fortunes sit in the same calculation as yours.

What drives the jump from under-35 to 35-44

The median more than triples from $39,000 to $135,600 between these two age groups. This is not magic. It is compound interestcompound interestEarning interest on your interest. Your returns reinvested to earn even more returns over time.Full definition on savings started in the 20s, plus home-equity accumulation, plus the highest-income decade beginning for most people.

A household that starts investing $500/month at age 25 instead of age 35 has at least $100,000 more by age 45 from that decision alone, before any change in income verify×DON'T TRUST, VERIFYClaim: $500/month at 7% annual return for 20 years (age 25-45) reaches approximately $260K; $500/month for 10 years (age 35-45) reaches approximately $87K. Difference roughly $170K.Verify at: Compound interest calculator ↗FV = PMT × [((1+r)^n - 1) / r] with PMT=6000/yr, r=7%. The "$100K more" framing is conservative; the gap is closer to $170K..

If you are behind the benchmark for your decade

You are not behind forever. You are behind for this specific benchmark. The action: start now, not when it feels like the right time. It never feels like the right time. See "Am I on Track?" and compound interest calculator.

What every dollar you invest now will be worth at 65

The most concrete way to internalize compounding: calculate, by your current age, how much $1 invested now turns into by age 65 at a 10% long-run nominal return. The numbers are not motivational; they are arithmetic.

At 10% nominal annual return (the long-run US equity average), $1 invested at 25 turns into roughly $45 by 65. The same $1 invested at 35 turns into roughly $17. Each decade of delay cuts the multiplier by roughly 60% verify×DON'T TRUST, VERIFYClaim: $1 invested at 25 reaches roughly $45 by 65 at 10% annual return; the multiplier drops by approximately 60% per decade of delay.Verify at: Compound interest calculator ↗Formula: FV = (1+r)^n. (1.10)^40 = 45.26. (1.10)^30 = 17.45. The 60% drop per decade is exact: 1/(1.10)^10 = 0.386, so each 10-year delay multiplies by 0.386, removing 61.4%..

In real (inflation-adjustedInflation-adjustedAdjusted for rising prices. Some amounts move with inflation, like IRS tax brackets, TIPS principal, or I-bond rates. Others are restated in today's dollars so different years can be compared: by the BLS consumer price index, $30,000 in 1985 bought about what $93,000 buys in 2026.) terms at a more conservative 7% return, the multipliers are smaller but the pattern is identical: every decade of delay roughly halves the multiplier. A worker who saves $5,000/year from 25 to 35 and stops, contributing nothing further, ends up with more at 65 than a worker who saves $5,000/year from 35 to 65. Time, not contribution amount, dominates the outcome.

The implication for the decades below: the highest-leverage move in your 20s is to start. The amount matters less than the start date. The highest-leverage move in your 40s is to maximize savings rateSavings rateThe share of income you save or invest, usually (income minus spending) divided by income. Saving $1,000 of $5,000 take-home pay is a 20% rate. Whether you use gross or take-home pay, and whether 401(k) contributions and an employer match count, changes the number, so compare rates only on the same definition.Full definition, since fewer years of compounding ahead means each contributed dollar carries less multiplier. Run the specific scenario at compound interest calculator.

Your 20s · Foundation

Time is the variable you can never recover. The dollars saved in your 20s have 40+ years of compounding ahead of them. The behaviors set in your 20s become the defaults that run on autopilot for decades.

1. Emergency fund. 1 month of expenses minimum, 3 months by the end of your 20s. In a high-yield savings account, not a checking account.
2. Employer 401(k) match. Contribute at minimum the threshold required to capture the full match. A 50% match is a guaranteed 50% return on your contribution. See the 401(k) match optimizer.
3. High-interest debt elimination. Credit card debt at 20-30% APRAnnual Percentage Rate (APR)The yearly cost of borrowing money, shown as a percentage.Full definition is the highest priority. Student loans below 5% can run alongside investing.
4. Roth IRA. Your tax rate is likely the lowest it will ever be. Even $50/month started now matters more than $500/month started later.
5. Credit foundation. Build credit intentionally. Pay statement balance in full monthly. See Building Credit From Zero (or Repairing It).

Bitcoin allocation, if any: a small DCADollar-cost averaging (DCA)Investing a fixed amount on a regular schedule, such as $50 every payday, regardless of price. It spreads out when money enters the market and buys more units when prices are low, but it does not guarantee a better price than investing all at once, a profit or protection against loss.Full definition position is appropriate if you have earned income and no credit card debt. Size it so you would not panic-sell through a 50-80% drawdown. The 21-year-old who survives one Bitcoin bear marketBear marketA long slide in prices, usually defined as a drop of 20% or more from a recent high in a broad market index such as the S&P 500. Bitcoin's four completed cycle bear markets bottomed 77% to 93% below their peaks, and so far it has gone on to new highs after each one. without selling owns the discipline that compounds the next 40 years.

Your 30s · Acceleration

Income is rising. Career capital is compounding. The decade where most people either build the foundation under their long-term wealth or drift into lifestyle creep that erases the next 30 years of returns.

1. Savings rate to 15-20% of gross incomegross incomeYour total income before any taxes or deductions are subtracted.. Max the Roth IRA ($7,500 in 2026). Increase 401(k) contribution above the match.
2. Insurance. Term life if anyone depends on your income. Disability insurance: the most-underowned protection in this decade. Update beneficiaries after any major life change.
3. Home purchase if applicable. Not mandatory. Rent vs buy depends on your market, your timeline, and the math. See the mortgage vs rent calculator. Under 3 years in the same place: rent almost always wins.
4. Income growth. The decade with the highest lifetime impact from negotiations, promotions, and job changes. A $20k raise at 32 compounds for 33 years to retirement.
5. Lifestyle inflationinflationA general increase in prices over time, meaning each dollar buys less than it did before.Full definition guard. Before any raise takes effect, increase your automatic investment contribution by at least half the raise. The spending never grows into the full raise.

Fidelity benchmark by 30: 1x annual salary saved across all retirement accounts verify×DON'T TRUST, VERIFYClaim: Fidelity's age-based benchmarks are 1x salary by 30, 3x by 40, 6x by 50, 8x by 60, 10x by 67.Verify at: Fidelity Viewpoints ↗ Source 2 in the list belowFidelity publishes the benchmark periodically. Numbers are guideposts, not hard rules..

Your 40s · Optimization

Peak earning years for most professionals. The decade to optimize tax treatment, asset locationAsset locationChoosing which account holds which investment to cut taxes. Holdings that produce yearly taxable income, like bond interest, go in tax-advantaged accounts such as a 401(k) or IRA, while holdings that create little tax until sold or spent, like broad stock index funds or Bitcoin, can sit in a taxable account.Full definition, and protection. Mistakes here compound less than in your 20s but matter more in absolute dollars.

1. Retirement-account maximization. If you have capacity, max the 401(k) ($24,500 in 2026). Consider backdoor Roth if over the income limit. Consider mega backdoor Roth if your plan allows it.
2. Tax optimization. Asset location across taxable, Traditional, and Roth accounts. Tax-loss harvestingtax-loss harvestingSelling an investment that has declined to realize a tax loss, then buying a similar investment, reducing your tax bill without changing your portfolio.Full definition in taxable. Roth conversionRoth conversionMoving eligible retirement money into a Roth account. Pre-tax amounts and earnings generally create taxable income; nondeductible basis is treated under the applicable aggregation rules. Conversions can affect tax brackets and income-based costs, and separate withdrawal rules apply.Full definition consideration in lower-income years.
3. Protection review. Enough life insurance? Disability still appropriate? Umbrella policy? Will current?
4. College funding (if applicable). 529 contributions. Never sacrifice retirement for college. Your kids can borrow for college. You cannot borrow for retirement.
5. Mid-career evaluation. Are you on the trajectory you want? The 40s are still early enough to pivot if needed but late enough that pivots have real cost.

Fidelity benchmark by 40: 3x annual salary saved.

Your 50s · Protection

Two decades from now you may stop earning. The 50s are about protecting the corpus you have built and adding the catch-up contributions the IRS allows after age 50.

1. Maximize catch-up contributions. At 50+: additional $8,000 to 401(k) ($32,500 total in 2026). Additional $1,100 to IRA ($8,600 total). The "super catch-up" of $11,250 applies at ages 60-63 starting in 2025 under SECURE 2.0 verify×DON'T TRUST, VERIFYClaim: SECURE 2.0 created a super-catch-up of $11,250 for ages 60-63 starting 2025.Verify at: IRS catch-up FAQ ↗ Source 3 in the list belowSECURE 2.0 (Public Law 117-328) section 109 created the higher catch-up for ages 60-63. The $11,250 figure is for 401(k); SIMPLE plan amounts differ..
2. Long-term care planning. The optimal decade to purchase LTC insurance, before premiums spike and health issues emerge. See Long-Term Care Insurance: What It Covers and Costs.
3. Estate planningestate planningOrganizing your assets and legal documents so they transfer correctly and efficiently when you die.Full definition update. Will, powers of attorney, healthcare directive. BeneficiarybeneficiaryThe person or entity you name to receive an account or insurance policy when you die. designations on every account. The 2026 federal estate exemption is approximately $15M per person ($30M per married couple) after OBBBA made the higher TCJATax Cuts and Jobs Act (TCJA)The 2017 federal tax law that nearly doubled the standard deduction, capped the state and local tax (SALT) deduction at $10,000, and cut individual and corporate tax rates. In July 2025 the One Big Beautiful Bill Act made most of its personal cuts permanent and raised most filers' SALT cap to at least $40,000 through 2029.Full definition exemption permanent. State-level estate-tax thresholds are often much lower (see After OBBBA: What the 2026 Tax Code Looks Like).
4. Social Security strategy. Understand your projected benefit at 62, 67, and 70. Model the break-even between claiming ages. See When to Claim Social Security: $200K Decision.
5. Portfolio risk assessment. A 100% equity portfolio at 30 may be appropriate. At 55, a 30% market decline 5 years before retirement has a different consequence. Sequence-of-returns risk is now relevant. Consider a glide pathglide pathThe schedule by which a target date fund gradually reduces stock exposure and increases bond exposure as the retirement date approaches.Full definition from 100/0 toward 70/30 or 60/40 as you approach retirement.

Fidelity benchmark by 50: 6x annual salary saved.

Your 60s · Transition

Decisions made in this decade have outsized lifetime impact. The Social Security claiming decision alone is a six-figure choice. Medicare enrollment timing affects premiums for life. Withdrawal sequencingwithdrawal sequencingThe order in which retirement accounts are drawn down. Conventional textbook order is taxable, then Traditional, then Roth. The actual optimal order depends on Roth conversion opportunities, RMD pressure, IRMAA, and Social Security timing. determines how long the corpus lasts.

1. Social Security claiming decision. Every year you delay past Full Retirement Age earns an 8% permanent benefit increase up to age 70. If health and family longevity allow, delaying to 70 typically yields the highest lifetime benefit for the higher-earning spouse verify×DON'T TRUST, VERIFYClaim: Delayed Retirement Credit is 8% per year past FRA up to age 70.Verify at: SSA delayed retirement credit page ↗ Source 4 in the list belowFor people born 1943 or later, the credit is 8% per year of delay past FRA, capped at age 70..
2. Medicare enrollment. Enroll during your Initial Enrollment Period: 3 months before, the month of, and 3 months after your 65th birthday. Missing this window creates permanent premium penalties on Part B and Part D verify×DON'T TRUST, VERIFYClaim: Late enrollment in Medicare Part B incurs a 10% premium penalty per 12-month delay, permanent.Verify at: Medicare late-enrollment penalties ↗ Source 5 in the list belowPart B penalty is 10% per 12-month delay, lasting as long as you have Part B. Part D has its own penalty structure..
3. Withdrawal strategy. Which accounts first? General order: taxable accounts first, then Traditional, Roth last. But this depends on your tax bracket and Social Security timing. Roth conversions in early retirement (between ending wages and starting Social Security) can reduce lifetime tax burden substantially.
4. Healthcare bridge. Retiring before 65? How will you cover health insurance until Medicare? ACA marketplace, COBRAConsolidated Omnibus Budget Reconciliation Act (COBRA)A federal law that lets you and your covered family keep an employer's group health plan after a job loss, cut in hours, divorce, or death, usually for 18 months and up to 36 in some cases. You can be charged up to the full premium plus a 2% fee. It generally applies to employers with 20 or more employees.Full definition, spouse's plan, or part-time work with benefits.
5. RMDsRequired Minimum Distribution (RMD)The minimum the IRS requires you to withdraw each year from traditional IRAs, 401(k)s, and similar accounts, generally starting at 73, or 75 if born in 1960 or later. It equals the prior December 31 balance divided by an IRS life expectancy factor. Roth IRAs and Roth 401(k)s have no RMDs during the owner's lifetime. (Required Minimum Distributions). Begin at age 73 (rising to 75 by 2033 under SECURE 2.0). Plan for the tax impact of forced withdrawals from Traditional accounts.

Fidelity benchmark at retirement: 10x annual salary saved.