By Gabriele Denaro · Published 20 September 2026 · Updated 6 October 2026
Take five people with a net worth of €20,000, €25,000, €30,000, €35,000 and €1,000,000. The average is €222,000. Not one of them is near it. The median, the middle value, is €30,000, and it describes the group far better. Averages are pulled toward extreme values, which is why statistics about wealth, income and savings are usually more honest as medians.
The same problem appears in returns. An investment that gains 50% one year and loses 50% the next has an average return of 0%, yet it leaves you with 25% less than you started with. A smooth "7% average annual return" hides the lumpy sequence of good and bad years that actually happened, and the order of those years changes what it is like to live through them. The CAGR guide explains the difference.
A statistic on the average savings rate or the average net worth of people your age is calculated on a population with different incomes, costs and starting points. Even a correct average does not tell you what is realistic for you. It can make you feel behind when you are doing fine, or comfortable when you are not.
When you read a figure, ask which kind it is and what surrounds it. A median says what is typical. A range or quartiles say how much people differ. A year-by-year table says how bumpy a return was. A single average says none of those things.
Averages are a starting point, not a target. Your own series, measured the same way every month, tells you what is true for you. Use outside numbers for context and your own for decisions.
General educational information, not personal financial, tax or legal advice. It may be incomplete or out of date. Terms of use.