Zagorsky, 11 (1)

Zagorsky, J. L. (2000). Do individuals know how much they
are worth? Financial Counseling and Planning, 11(1), 13-24.

Do Individuals Know How Much They Are

Jay L. Zagorsky1

How accurate are individuals’ perceptions of their wealth holdings?
Data from the National Longitudinal Surveys show approximately 70% of all
respondents believe they hold far less and 25% believe they hold far more
wealth than they actually possess. For every dollar of wealth owned, typical
individuals believe they hold only 62 cents. Increasing an individual’s
wealth by one dollar raises perceptions by just 27 cents. Most individuals
need to calculate their net worth to correct their perceptions. Results
show older individuals have a smaller perception gap than younger individuals,
and Blacks and Hispanics have a higher perception gap than whites.

Key words: Net worth, Perceptions, Attitudes, National Longitudinal

1. Jay L. Zagorsky, Research Scientist, Center for Human Resource
Research, Ohio State University and Boston University School of Management.
Phone: 617-713-4447. Fax: 617-353-6667. E-mail:

 The author thanks Randy Olsen, Kevin Lang, Rosella Gardecki
and Jon Krosnick for their help and comments. The author accepts responsibility
for any remaining errors.

Return to
journal home page