What a great question to ask ! I am sitting here thinking to myself what it takes to be in the top 10% of the world.
So, are you in the world’s wealthiest 10% (more like ~12%) ?
Credit Suisse publishes the Global Wealth report every year. The stats above are from the global wealth report of 2021.
There is a sense of gratefulness as I type this. If you’re reading this from Canada or United States, you’re likely better than almost half of the world’s population. Yes, being in a developed country and holding a half-decent job would propel us to be in a much better position than the most of the world. If you already own a primary residence in North America and have acquired some equity, you will most likely be wealthier than 55% of the world population. If you’ve built equity over a few years (say $100K or more), your net worth is likely higher than almost 80% of the world. For this, I am eternally grateful.
If you individually have a net worth of $128K (CAD) or more, you’re in the top 12% in the world. What is rather sad to note here is that 55% of the world adult population has a net worth of less than $12.7K. If you’re student in Canada or the US, you might be in this bucket for now owing to student loans and other debts. Fear not as net worth tend to shift to positivity in your late 20s and 30s.
What about the top 10% in Canada ?
Now, this is comparing apples to apples now if you’re here in Canada like we are. The numbers below are from a Stats Canada publication for the year 2019. Key point of difference between we look at the numbers. We’re looking at households here and not individuals. Also, the Stats Can data is for 2019 relative to the stats for 2021. Nonetheless, the numbers are a great indicator of our answers.
The lowest decile is about $13.5K in debt on average while the top 10% of all Canadian households have an Average Net Worth of $3.6 Million. Keep in mind, this is an average and is highly skewed by the most wealthy households in each decile.
To get a more accurate reading of where you might place, I would recommend looking at the Median values. The Median value is the most common (or middle) value within that decile. There are like some very wealthy outliers in each decile. And so, the median values would represent the most likely household net worth for that decile. The wealthiest households (10%) generally have a Net Worth in the $2.6 Million region.
Again, these numbers are pre-COVID before property (real estate) really rose up sharply. You can read more about how the data is sliced and diced by province and age in this post.
What if I placed in a lower decile ?
Its all-right. The only other decile direction that one can go is up unless they consciously choose to incur debt. 🙂
The Stats Can data source also shows us the change in Median Net Worth for all year the data was collected. The first bar represents a value of 1 for all the base year of 2005. The subsequent bar represents the median net worth in 2012 over the median net worth in 2005. The third bar the proportion between 2016 and 2005. The fourth bar the proportion between 2019 and 2005.
The Median Net Worth for the second, third and fourth deciles generally seem to be increasing at a faster pace compared to the wealthier deciles. I am going to refrain from making inferences here. However, we should be cautious here because the change in deciles two, three and four is relatively higher because of smaller dollar values. Increase in minimum wages for example would impact the lower deciles the most as an example.
Here’s some context to give you a better idea of the scale in the chart below:
- A change of $5,000 represents a 100% increase in Decile 2 over the base year (2005). The 100% increase would be represented as 2.00 in the following chart.
- For decile four, a change of 100% would be $74.5K in median net worth.
- For decile eight, this would be just over $550K.
