10 Shocking Money Stats of the Average Person (2025)

Cult Insight

In this video, I share 10 surprising money stats that reveal what the average person’s finances really look like - from income and savings to debt and retirement.  DISCLAIMERS & DISCLOSURES  This content is for educational and entertainment purposes only. i does not provide tax or investment advice. The information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. All investing involves risk, including the possible loss of principal.   Thank you for your support!  *T&C's apply

Transcript

00:00Think you're doing okay with money? Let's see how you compare to the average person.

00:04Because when you look at the real numbers behind how people actually earn, spend and save,

00:10things can get pretty shocking. I'm Nisha. I'm a former investment banker turned financial educator

00:16and today I'm breaking down 10 jaw-dropping money stats that reveal what's really going on

00:22behind people's finances and what you can learn from it. By the end of this video,

00:26you'll see why most people struggle to get ahead and how a few smart but strategic habits can put

00:32you miles ahead of the average. Let's start with stat number one, which is what the average household

00:39income really is. The average US household income in 2024 was $121,000. And while that might sound

00:48impressive, it doesn't tell us the full story because that's the mean average, meaning everyone's

00:54incomes are added together and divided by the number of households. So the final number can

01:00often be distorted by higher earners. In fact, a much more accurate number to go off is the median

01:06income, which is where you put all the incomes in a line from smallest to largest and you pick out

01:12the one in the middle. And in the US, the median or the middle household earns $83,730. And so the gap

01:21tells us that a small number of very high earners are skewing the average upwards, while millions of

01:27ordinary households are actually earning far less. It is no wonder two-thirds of Americans say they're

01:32living paycheck to paycheck because when you take out things like taxes, rent or mortgage, healthcare,

01:38debt payments, that average income doesn't go as far as you'd think. What about over in the UK?

01:43In the UK, the median gross annual earnings for full-time employees in the UK stood at £37,430

01:51last year. But as you might have guessed, the average largely depends on age. With 18 to 24,

01:57that is £24,440 on average compared to 40 to 49 year olds, which is £42,796. So with all this

02:07information, how much do people actually need to feel comfortable? The truth is what matters most isn't

02:12how your income compares to national averages, but how effectively you manage what you earn.

02:17So just start by understanding your after-tax income and building a realistic budget. For example,

02:22allocating 65% to NEIS, 20% to WODs, 15% to your future you. I have a completely free budget tracker

02:28that encourages you to budget using these allocations. It's completely free. You can use it. It's in the

02:34linked below. From there, focus on building an emergency fund, then paying off high interest rate debt

02:39and investing consistently to grow wealth over time. I have a video as well on how to optimise

02:44your finances and in what order over here. And since the cost of living changes so much based on

02:50geographic location, it's essential to measure financial comfort by how far your money goes

02:56where you live, not arbitrary national figures. The goal isn't to match an average, but to build

03:00stability and freedom within your own financial reality. Stat number two, which shows you just how

03:06dangerous timing the market can really be. If you missed the market's 10 best days over the past

03:1330 years, your returns would have been cut in half. And missing the best 30 days would have reduced

03:20your returns by an incredible 83%. This shows just how damaging it can be to try and time the market.

03:28Nothing else. That is what it shows because whilst you've probably heard the phrase,

03:31buy low, sell high, it's actually much, much harder to do than you might think. You might think stocks

03:37are high today only to go for them even higher. They might dip making you think they're low only

03:42for them to dip even further. And as the data shows, the best days often happen right after the worst

03:48ones. So for example, in 2020, when markets crashed during the pandemic, some of the biggest gains in

03:54history came just weeks later. And so if you panicked and you sold when things looked scary,

03:59you very likely missed the rebound that followed. This is why long-term investors always say time in

04:06the market beats time in the market. This is such a powerful reminder that the biggest risk isn't the

04:12next crash. It's just getting scared out of the market and then missing the recovery. So whether you're

04:18investing through a 401k, your ISA, a simple index fund, the smartest strategy for most people is

04:25the boring one. Stay invested, stay consistent, let time do the heavy lifting. Stat number three,

04:31according to the National Financial Educators Council, low financial literacy costs the average

04:36American over $1,000 a year. And honestly, this makes total sense because if no one's ever taught you

04:42how to manage your money, how are you going to manage your money? It's so easy to miss a credit

04:48card payment. It's so easy to overlook better savings accounts or to avoid investing because

04:54it's complicated. But the truth is, you don't need to be a financial expert. You don't need to have a

05:00finance degree to get ahead. Just learning a few key principles can make an enormous difference.

05:07Understanding how interest rate works, how to budget effectively, how to avoid common money traps

05:12can literally save or earn you thousands every year. Start small, learn one thing about money

05:18each week, watch a video or two and just apply what you learn there and then. Before long,

05:23you'll notice the difference in your confidence, in your savings and in your peace of mind. And if

05:27you want a simple way to start, you can always subscribe to this channel. I walk through the

05:31basics of building wealth every single Sunday, step by step in plain English. Stat number four,

05:36these stats show the surprising reality of how many people actually have an emergency fund.

05:4218% of US adults said the largest emergency expense they could handle right now using only

05:47savings was under $100, meaning nearly one in five people would struggle to cover even a small car

05:54repair or vet bill without needing to borrow money or sell something. Only 63% of adults said they could

06:01pay a $400 emergency expense entirely with cash, savings or a credit card, they'd pay off immediately.

06:08And the situation is similar in the UK as well. The average person has around £16,000 in savings,

06:14but that figure, again, is heavily skewed by wealthy savers. In reality, two in five Brits have £1,000

06:21or less set aside, barely enough to get through a month of expenses. This lack of financial cushion,

06:28it creates a dangerous cycle because when an unexpected cost hits, you can turn to credit

06:34cards or loans, which then ends up eating into future income through repayments and interests.

06:40So the best way to break that pattern is to start small and stay consistent. Even saving 20 or 25 a week

06:47builds resilience over time. You become the person who can save, the person who can prove to themselves that

06:53they can put a portion of their income aside to save. Start with one month of your essential living

06:58expenses and then build towards three to six months. It's about creating the breathing room that keeps

07:04you secure when life inevitably throws a curveball. Stat number five, and this one is about retirement.

07:10About 33% of private sector employees in the US don't have access to an employer-sponsored

07:17retirement plan. That means no 401k, no employer match, no automatic contributions quietly building

07:24up in the background. And even among workers who do have a plan, only about half actually contribute

07:30to it. The way I see this is that it's one of the biggest gaps in the US financial system because

07:35having a workplace plan is one of the most simplest ways to build long-term wealth because it gives you

07:41an element of structure and discipline that you don't have when saving for retirement on your own.

07:46The hardest part is getting started, especially if your day-to-day living costs are high and you're

07:51struggling to even save for an emergency like the people we spoke about earlier. When we then throw

07:56the lack of financial education into the mix, it makes me wonder how many people don't actually know

08:02how important saving for retirement can be and how much easier a workplace scheme can make it.

08:08I wonder if the US could benefit from following in the UK's footsteps here because as you can see

08:14in this graph on the screen, the number of private sector workers saving into their workplace pension

08:19was declining steadily through the early 2000s in the UK. But what changed that was when the auto

08:25enrollment scheme was introduced in 2012. As you can probably guess by the name, the scheme made

08:30employers enroll employees into their workplace pension scheme automatically. Workers can opt out if

08:37they won, but most don't. By 2018, therefore, 72% of private sector employees were participating in a

08:46workplace pension and it grew even further to 75% in 2021. And it's not because people suddenly became

08:53disciplined or became financially savvy. It's just because the system made saving the default. And since

08:59employers have to pay at least 3% of the employees' qualified earnings into the pension, when you opt out,

09:05you're effectively turning down free money for a better future. So unless the US removes the

09:09friction and makes retirement saving automatic, many Americans are likely to reach retirement age

09:14relying on social security, which might not be enough to get by. Now, the next one is something

09:20that I recently talked about on the Diary of a CEO podcast. And I had so many messages from people

09:24afterwards to say that learning this tip or understanding the psychology behind it completely

09:29changed their perspective on saving. And so I had to share it today. Stat number six,

09:34realizing how much of an impact saving can make to your financial well-being. Did you know that

09:39having as little as $2,000 in emergency savings can make a huge difference to your overall financial

09:46health, according to a report by Vanguard? In fact, people with at least $2,000 saved reported a 21%

09:53higher level of financial well-being compared to those with no emergency savings at all. And those who had

09:59enough to cover three to six months of expenses saw an additional boost of 13%. On the flip side,

10:06people without any emergency savings spent twice as much time worrying about money, even if they have

10:12money in investments. And investors without an emergency fund spent around seven hours a week

10:18thinking about and dealing with their finances versus just under four hours for those with a small

10:23buffer. They're also four times more likely to be distracted at work because of financial stress.

10:29What I really love about this data is that it shows that money isn't just about numbers in your bank

10:33account. It's about the emotional side too. Having money set aside can give you peace of mind and help

10:39you avoid sleepless nights stressing about how you're going to pay your bills or even how you're going to

10:44pay for your mortgage. That's why having even a modest cushion of just a couple of thousand dollars

10:49or whatever currency that applies to you can change so much. You'd need just enough to keep you from

10:56falling into debt every time life throws a curveball because when you have that buffer, you're not

11:01protecting just your bank account. You're protecting your focus. You're protecting your productivity.

11:05You're protecting your mental health as we can see. Stat number seven, and this one is about how many

11:10high earners are actually just living paycheck to paycheck. According to PNC's Bank's 2025 financial

11:17wellness report, 67% of Americans say they're living paycheck to paycheck. That means millions of people

11:23are struggling just to cover their basic expenses and surprisingly, this includes nearly half of those

11:29earning over $100,000 a year. This is just a reminder that financial stress isn't only about how much you

11:36earn but also about how much you spend. Lifestyle inflation, i.e. the tendency to spend more as you

11:42earn more, can quietly erode your financial stability. You get a raise, you pick up new clients, and suddenly

11:48you feel justified to upgrade your wardrobe, to dine out more, to move to a bigger home. But before long,

11:55your higher income is completely absorbed by your higher expenses, leaving you pretty much no better

12:01off than you were before. The key to breaking the cycle really is to automate. As soon as you get your

12:07paycheck, take a portion of it and put it away into another savings account straight away. Out of sight,

12:12out of mind. And then as your pay increases, you don't want to keep that amount that you're

12:16automatically putting away the same as well. You also want to increase that in proportion to your

12:21increase, if not more. Don't rely on willpower, rely on systems. Stat number eight, nearly one in five

12:28new car buyers, i.e. 19.3%, are paying over $1,000 a month for their car in the US. And the average

12:36loan term is almost 70 months with a 7.2% APR. The average amount financed is $42,388 and the average

12:44down payment is $6,430. And things aren't looking much better for used car loans, which have an

12:51average monthly payment of $559 at 10.9% APR, an average term of 69.7 months. This basically means

13:01that whether you buy a new car or a second hand, you can find yourself locked in in almost six years

13:07of payments for something that's losing value the minute it leaves a dealership. If you want to know

13:12the most effective way to buy a car and how you keep your car costs low, I have a complete video

13:16on that. It's linked over here. Stat number nine, the average student loan balance in the US is $42,673,

13:23including both federal and private loans. The typical monthly payment is around $503,

13:29with repayment terms often stretching 20 years or more. For graduate degree holders,

13:35that figure jumps to over $60,000 on average. How does this compare to other parts of the world?

13:41In England, the average student debt was £53,000 for those who finished their course in 2024.

13:48Although this is higher than the average US debt, the way student loans work in England puts slightly

13:53less of a burden on borrowers. Because unlike in the US, where student loans function like

13:58traditional debt, the system in England works more like a graduate tax. You could only start making

14:04repayments once you earn above a certain income threshold. Currently £27,295 per year for most

14:12plans. And if your income falls below that, or you lose your job, your repayments automatically pause.

14:18There's also a time limit. After 30 years, any remaining balance is wiped no matter how much you still

14:23own. So while UK graduates technically carry more debt on paper, and these loans can grow significantly

14:29as interest is added, the system is set up in a way that protects borrowers a bit more. In contrast,

14:36American graduates are expected to pay off their loans in full, often over decades, with no automatic

14:41write-off period. That is why so many people in the US are still paying off their student loans well into

14:46their 40s and 50s, sometimes long after their own kids have started college. Stat number 10, 7% of the US

14:53population are millionaires. And I don't know about you, but I found this really, really surprising.

14:57That's around 23.8 million people. That means there's more millionaires than the entire population

15:04of Florida. And the US is home to nearly 40% of the world's millionaires, far ahead than any other

15:11country. China takes second place with 6.3 million millionaires, followed by France with a 2.9 million.

15:17Meanwhile, in the UK, there's 2.62 million millionaires, which is 3.8% of the population.

15:24But here's what's really interesting. In the US, the UK, and other parts of the world, being a

15:30millionaire may make you more fortunate than more than 90% of the population, but it doesn't always

15:37mean you're rich. Because thanks to inflation, rising home prices, and higher living costs, having

15:441 million in assets doesn't stretch as far as it used to. In fact, surveys show that 1 in 3 millionaires

15:52say they still feel like they're living paycheck to paycheck, especially those living in expensive

15:57cities like in San Francisco and in New York. So while the number of millionaires keeps growing,

16:03the feeling of financial security hasn't necessarily followed. And this is just a reminder that wealth

16:09isn't just about how much you earn, it's about how well you manage, grow, and protect what you have.

16:15One way you can do that is through investing in the stock market, but another way is to invest in

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17:29So that's it. Those are 10 shocking stats. If any of them sound familiar to you, awareness is the

17:35first step in changing a situation. And well and truly, knowledge is power. You can always subscribe

17:41for more personal finance on this channel at any time. Thank you so much for watching and see you next week.

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