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Owning a home, contributing to a retirement account, or maintaining an emergency fund may not be enough to achieve lasting financial security.
A new report from the Aspen Institute’s Financial Security Program (1) argues that Americans need a combination of liquid savings and appreciating assets to build what it calls “essential wealth” — the financial foundation needed to weather emergencies, invest for the future and retire comfortably.
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But according to the report, only 26% of U.S. households have reached that benchmark, leaving nearly three in four without enough wealth to fully achieve those goals.
“The headline finding is stark: The vast majority of American households — three out of four — do not have essential wealth,” the researchers wrote.
Worse still, this isn’t just a look at in-progress wealth building.
“Most households do not reach essential wealth at any age,” the report found, noting that even many Americans approaching or in retirement still fall short of the benchmark despite decades of saving.
‘Wealth is not just for the wealthy’
The report defines essential wealth as having both sufficient liquid savings to absorb financial shocks and enough net worth invested in appreciating assets — retirement accounts, home equity or businesses — to build long-term financial security.
Researchers argue that income alone isn’t enough because wages pay today’s bills, while wealth creates future opportunities and financial flexibility.
“Families cannot afford to wait for wealth until every other financial need has been met,” the report states. “Wealth is not just for the wealthy. It is necessary for everyone.”
To reach the benchmark, households must clear both a savings threshold and a net worth threshold, which vary by age.
For example, the report says a typical household in its 20s would need roughly $40,000 in net worth and six weeks’ worth of take-home pay in liquid savings to qualify as having essential wealth. For households in their 30s, that illustrative benchmark rises to roughly $120,000 in net worth plus six weeks of income in cash savings.
Importantly, essential wealth is just the final destination in a three-step journey. The report also details earlier, more manageable brackets — underscoring the fact that essential wealth is a developing goal, not an ultimatum.
One way to start building wealth is by investing consistently, even if you’re starting with small amounts. Micro-investing apps such as Acorns can help automate the process by rounding up purchases and investing the spare change into diversified portfolios.
For instance, if you buy a donut for $3.25, Acorns will round up the purchase to $4 and invest the change in a smart investment portfolio. So a $3.25 purchase automatically becomes a 75-cent investment in your future. Once you’re comfortable with your investments, Acorns can also help you make regular monthly contributions to speed up building out your nest egg.
Perhaps the most concerning finding is that reaching essential wealth remains difficult regardless of age.
While wealth generally increases over a lifetime, the report found that most households never accumulate enough to meet the benchmark.
Even among Americans 65 and older, those who have had the longest to save and invest, still fall short. Households in their 50s and early 60s reach essential wealth at roughly the same rate as people decades younger, suggesting many Americans are approaching retirement without the financial cushion researchers believe is necessary.
The report argues this is simply the result of “the sheer consistency of the gap across age groups points to structural barriers that inhibit wealth building beyond individual saving behavior.”
The report also challenges the idea that owning a home automatically puts households on solid financial footing.
Many families who own homes remain below the report’s “emergent wealth” threshold because they lack sufficient liquid savings. While home equity is an important asset, researchers note that households can still be “house poor” if most of their wealth is tied up in property and they don’t have enough cash to handle unexpected expenses.
Likewise, some households have accumulated meaningful assets but still fall short because they haven’t built an accessible emergency fund. Fidelity (2) notes that many investors should maintain emergency savings separate from long-term investments.
The report concludes that reaching essential wealth “typically requires a diverse portfolio of appreciating assets — home equity, retirement savings, and other investments working together — rather than outsized reliance on any one vehicle.”
Lasting financial security comes from owning multiple appreciating assets rather than relying on a single source of wealth. For investors who want exposure to real estate without purchasing another property, platforms such as Arrived allow individuals to invest in shares of rental homes.
Backed by world-class investors, including Jeff Bezos, Arrived allows you to invest in shares of rental properties and earn a passive income stream without the extra work that comes with being a landlord.
If you’re behind on building wealth, the report suggests thinking beyond a single retirement account or emergency fund.
Financial professionals at CFP Board (3) generally recommend building wealth through a diversified mix of assets while maintaining enough liquid savings to handle unexpected expenses without taking on debt. Some investors also choose to diversify a portion of their retirement savings with alternative assets such as precious metals.
If you’re curious about adding precious metals to your broader inflation-hedging strategy, a gold IRA from Goldco lets you hold physical gold and other metals while still getting the tax advantages of an IRA.
They also offer a guaranteed buyback program, meaning they’ll repurchase your metals at the “highest price” according to market value if you ever decide to sell.
If you want to explore whether precious metals could be a helpful hedge for your portfolio, you can download Goldco’s free gold and silver guide to see if it’s a good fit for you. Just keep in mind that gold is typically best deployed as one part of an otherwise well-diversified portfolio.
Get a second opinion
If you’re unsure whether your savings strategy aligns with your retirement timeline or broader financial goals, speaking with a qualified financial advisor can help you evaluate your options and create a personalized plan.
If you have a portfolio of $250,000 or more, platforms like WiserAdvisor can connect you with vetted professionals who specialize in this kind of planning.
Simply answer a few questions about your savings, retirement timeline and overall investment portfolio.
From there, WiserAdvisor reviews its network to match you — for free — with up to three vetted, reputable advisors aligned with your specific needs.
WiserAdvisor is a matching service and does not provide financial advice directly. All matched advisors are third parties, and specific financial results are not guaranteed.
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Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see ourethics and guidelines.
Aspen Institute (1); Fidelity (2); Certified Financial Planner Board of Standards (3)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
