In the words of Homer: “Nothing shall I, while sane, compare with a friend.”
But more often than we might admit, we judge apartments, fashion accessories and even our own attractiveness against other people.
So it should come as no surprise that people love comparing money. Studies have shown that people tend to care more about their relative income than their actual income.
In other words, we don’t just want enough to make us happy … we want more than our neighbors, the Joneses.
How They Work
Both of these services have you input your financial information. Then they crunch the numbers, tell you how you compare to your peers (those in your age group, income bracket, etc.), and include your data points for future users to compare themselves.
Although there's something voyeuristic about spying on other people's finances, we think it's possible to use this information to improve our finances.
Note that both sites probably have skewed data because the people who choose to report their net worth are likelier to have more money than those who don't.
This is structured like an online quiz. First, you answer basic questions about your age, income, gender and marital status so that ING can find a group of "people like you" to compare you against. After that, the tool walks you through about 25 questions ranging from whether you've started saving for retirement to how much you pay per month in rent. The ING community of users recently exceeded a million users.
At each step, you'll see how you compare to other people in your demographic group who have already taken the quiz. (For example, you can enter that you're a 35-year-old married woman making $75,000-$100,000, and you'll see that 813 others have taken the quiz.) When all is said and done, you can download a 14-page PDF with your full financial comparison report.
This site is structured more like a traditional social networking site—but for gawking at other people's net worth. Creating an (anonymous, if you want) account involves sharing your net worth, from how much you have saved in cash, stocks and bonds to the breakdown of your personal debts. Then the system calculates your net worth and, if you choose to make your profile public, shares it with the world. You can also pull up a chart that compares your net worth to that of others in your age group, income bracket, education level and more.
You can keep your profile private, but members appear to enjoy this site as much to check on other people as to boast their own successes. There's a space to provide money tips and journal entries, presumably so followers can try to copy you to get rich, too. Net worths north of $3 million are not uncommon (if no members are fibbing), so if you want to see where rich people store their money, you've found your answer.
(Note: If you just want to know your net worth, you can calculate it automatically with the LearnVest My Money Center.)
The Winner: INGCompareMe.com
We were more impressed with the ING tool than with NetworthIQ because the former is focused on using these comparisons to help people’s finances, whereas the latter sometimes loses sight of what’s important. (Plus, ING's interface is a lot smoother.) Although there's something voyeuristic about spying on other people's finances, we think it's possible to use this information to improve our finances.
Peer pressure is a powerful motivator. Out of 28,000 people who originally tested the ING site (employees of ING’s larger clients), 64% decided to take some sort of positive action afterward. So, if you’ve been searching for a kick in the rear, take heed. Comparing yourself to others might just be the inspiration you need to finally enroll in your company’s 401(k) or increase your monthly savings.
On the Same Note …
What should you do if you find out that your coworker is making more than you? Read this.
How much do other people spend on engagement rings? And how non-diamonds compare.
Speaking of spying on others, the eight most expensive celeb weddings with the shortest shelf lives: click here.
What do you think? Do these sites quench a rightful curiosity, or are they harmful to society?