Is your net worth on track for your age?
Most net worth rules of thumb come from countries with social security, where parents rarely depend on their children. These benchmarks follow the ones Ankur Warikoo lays out in his video on net worth by age, built for India.
About you
What you own
What you owe
Quick checks, optional
The benchmarks at 25, 30, 35 and 40
These come from Ankur Warikoo's video on net worth by age, expressed as multiples of your yearly income so they scale with your own lifestyle. A person earning ₹5 lakh a year and one earning ₹50 lakh should not have the same number.
A high net worth at 25 usually means money is going into the wrong things, since the best investment at this age is you: your skills, learning and exposure. The checklist is short. One month of salary in cash, a regular SIP of any size, and no debt at all.
About one year of income held in assets. Add 3 to 6 months of expenses as an emergency fund, term life cover of 10 to 15 times your salary, and your own health cover on top of your employer's. A home, wedding or education loan is fine as long as that first year of income is built.
Retirement saving starts to get serious here, and this figure includes the equity in your home. Keep at least 6 months of expenses aside, a SIP running, no credit card debt and at most one loan. Other loans should be cleared by now.
Aim for 9 to 12 months of expenses as an emergency fund, with 6 months as the minimum. Keep a SIP running, carry at most one loan, and hold your own health and life cover.
How is net worth calculated?
Net worth is what you own minus what you owe. Add up everything that can be turned into money, such as mutual funds, gold at its resale value, a vehicle if you would sell it, and your home. Then add up everything you owe, including loans, credit card dues, money borrowed from friends and the outstanding amount on a home loan. If your assets come to ₹10 lakh and you owe ₹7 lakh, your net worth is ₹3 lakh.
What should my net worth be at 30 in India?
By 30, the benchmark is about one year of your income held in invested assets. If you earn ₹12 lakh a year, that means roughly ₹12 lakh in net worth. Alongside that, you should have 3 to 6 months of expenses set aside as an emergency fund, term life cover of 10 to 15 times your salary, and a personal health cover on top of whatever your employer provides. Loans for a home, wedding or education are acceptable at this age as long as that first year of income is already built.
What is a good net worth at 40 in India?
The benchmark at 40 is 4 to 6 times your yearly income. You should also hold 9 to 12 months of expenses as an emergency fund, with 6 months as the minimum, keep a SIP running, carry at most one loan, and have your own health and life cover. If that looks steep, two things help: salaries in India tend to grow fastest in your 30s and 40s, and money compounding at 12 to 13% a year doubles roughly every five to six years.
Why are Indian net worth benchmarks higher than Western ones?
Four things push the number up. Private-sector employees have no social security, so nothing looks after you once you stop working. Your parents' retirement plan is often you, which Western models do not count. Healthcare costs have risen by about 13% a year over the last decade, roughly doubling every six years. And around 88% of India's wealth sits in real estate and gold, which are much harder to sell in a hurry than mutual funds or stocks. Together these mean you need a bigger cushion at the same age.
Does my house count towards my net worth?
Yes, at its value minus what you still owe on it. A ₹1 crore home with a ₹60 lakh loan outstanding adds ₹40 lakh to your net worth. The catch is liquidity. Selling a home takes far longer than selling mutual funds or stocks, so a net worth made mostly of property is less useful in an emergency than the same number held in investments.
Is it a problem if my net worth is low at 25?
No. At 25, a high net worth can be a sign that money is going into the wrong things, because the best investment at that age is in yourself: your education, skills, learning and exposure. What matters is having one month of salary in cash, a regular SIP running, and no debt at all. The biggest danger at 25 is getting trapped in loans, from credit cards, personal loans or loan apps, and that is much harder to recover from than a late start on investing.
What is the average net worth in India?
There is no recent official figure for average net worth. The last national survey of household assets and debt, run by the National Statistical Office as of 30 June 2018, put average assets at about ₹16 lakh in rural India and ₹27 lakh in urban India. That data is eight years old and counts assets, not net worth after debts, so treat it as a rough marker only. The video also notes, citing RBI data, that borrowing has been rising while incomes stayed fairly flat, and that the savings rate has been falling over the last five to six years.