The Average Net Worth By State, According To Recent Data
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If we love one thing, it is talking about net worth. If we love two things, it is long lists that are broken down by state. Today, courtesy of Personal Capital, we have a marriage of those two things with the average net worth by state.
It is worth noting, most people who use Personal Capital, do so because they want to have a better handle on their finances. That means that the data used by Personal Capital is going to skew higher than reality. Because when your pool consists of financially savvy people, you are bound to have a higher average net worth than if you were able to use data from the entire population.
Average Net Worth In Every State, According To Data From Personal Capital
So what gives with some states ranking so high while others are much lower? Simple. There are a lot more millionaires in the more densely populated states.
According to Personal Capital:
Not surprisingly, some of the states with the largest numbers of millionaire households ranked high in net worth. For example, New Jersey has the highest ratios of millionaire households per capita (9.76%). Connecticut (9.44%), Massachusetts (9.38%), California (8.51%), New Hampshire (8.47%) and Virginia (8.31%) also rank in the top 10 in both average net worth and ratio of millionaire households per capita.
Meanwhile, a high cost of living, including high taxes, could be a factor in some states not ranking highly in average net worth. For example, Delaware, Tennessee, Wyoming and Florida are among the top five states with the highest total tax burden, while Hawaii has the highest cost of living of any state in the nation.
If you are looking at this list feeling like a net worth on this level is unattainable, you’re probably not alone. The good news, however, is that your current financial situation doesn’t need to be your financial situation forever.
How to increase net worth?
Here are a few ways that you can do it. Implement them all and you’ll reach financial freedom early. Implement some of them and you’ll still be on the right track to a much higher net worth.
- Minimize expenses.
- Don’t spend money on luxury goods.
- Use the 50/30/20 rule if you have trouble with saving and spending.
- Generate more income with side hustles.
- Use money generated from side hustles and any other excess cash to invest and create new passive income streams.
- Reinvest all dividends.
- Wake up in 10 years and realize you’re kind of rich.
Sounds pretty easy doesn’t it? In theory, it is. In practice, you will need to be disciplined enough to stick to the plan. Because wealth takes time to grow. And the sooner you start the faster you will get to the financial finish line.