Asakiyume mita

After I wrote a few weeks ago that being a millionaire is not the ticket to a life of luxury most people believe it is I've fretted that I may have failed to connect with a broad audience. I mean, yes, a million in 2026 is not at all like a million in 1926, but it's still more than many people in 2026 expect they'll ever see. But then I saw an article in my newsfeed this week that being a millionaire is only "average" (USA Today, 19 Jan 2026).

More precisely, the article's headline claim is that the average American in their 50s has a net worth of $1.4 million. This comes from a report by financial services firm Empower, which the USA Today article also links to (Empower, undated, retrieved 19 Jan 2026).

I'm in my 50s; my mid 50s as of a recent birthday. So am I merely average for my age? First of all, no, because I actually have more than $1.4 million. Second, it's important to understand how "average" is calculated.

Most people can define "average" from grade school math. You add up all the numbers in a group and divide by how many numbers are in the group. For example, the average of 1, 2, and 6 is 3. (1+2+6 = 9; 9 ÷ 3 = 3.) This is called the arithmetic mean.

Curiously the arithmetic mean is not the only type of "average" that's used in statistics. And it's often not even the best. Economists prefer using the median when discussing averages in things like personal wealth because it's not skewed by there being a few ridiculously huge numbers (or centi-billionaires) in the mix. The median is the value at which half the members of the set are smaller/less wealthy, half are bigger/wealthier.

Indeed the $1.4 million average touted in the article is the arithmetic mean— the calculation that often gets skewed. Kudos to the author for noting this; the press often quotes "average" figures without identifying which average they are. Moreover, the article presents median figures as well as means. The median 50-something has a much more down-to-earth $192,964 net worth.

I give further kudos to the article for also identifying what powers a lot of these net worth figures: home equity. Being " a millionaire" in net worth doesn't necessarily mean you have $1,000,000 in the bank that you could withdraw and spend next week on luxury items. Most of the nearly 10% of American adults who are millionaires have a lot of their million-dollar-plus net worth tied up in the home they live in. It's the happy result of having bought in to a real estate market that, overall, has been growing for most of the past 20 years.

The tricky part about including home equity in net-worth calculations is that it's wealth you can't use. Sure, you could sell your house, cashing out the equity into liquid assets... but then where do you live? Either you buy another house and lock up all that money into home equity again, or you pay rent— which likely increases your monthly expenses and, over the course of years, can draw down your money pretty hard.