Homeowners Have Higher Net Worths, but You Can Still Get Rich if You Rent

Don't let being a renter prevent you from growing your wealth. 

According to the U.S. Census, the wealth inequality between homeowners and renters is staggering. The Census data shows that the median net worth of homeowners is a whopping 80 times the median net worth of renters. 

Some of this comes from the fact that people who buy homes tend to be more stable financially to begin with -- otherwise, property purchases would be out of reach. In other words, people who are already on the path to wealth are more likely to buy a house that makes them wealthier still.

A house is a valuable asset 

But, there's also another important reason property owners generally end up with a larger net worth. Their house is a valuable asset. And when they make mortgage payments, that's a type of forced savings since their housing costs end up helping them acquire a property that is worth a lot of money. This, coupled with the fact that homes often appreciate or go up in value, can make a huge difference in the final net worth a person ends up with. 

The big question, though, is what if you are a renter and you don't want to buy a home? Does this mean you'll never be rich? Not necessarily -- but you need to make a more conscious effort to grow your assets. Here's why (and how)

How can renters get rich too?

Renters are going to need to work a little harder to become wealthy compared to homeowners because they don't have required monthly payments they must make toward an asset that will become theirs and that should see its value increase over time. 

But that definitely doesn't mean it's impossible for those who rent to still become wealthy. The key is to make sure you are investing in other assets that should go up in value as well -- and that you are doing it consistently.

Ideally, if you are renting, you will be able to find a property that fits well within your budget -- and, perhaps, that comes with cheaper rent than what a mortgage loan would cost you. If you keep your housing costs to 25% or less of your income, then aim to save as much of the rest as you possibly can with the goal of putting aside at least 20% of what you are earning. Erring on the side of saving more of your money will be important because of the fact your housing payment isn't helping you build wealth like it is when you are a homeowner.

You don't just want to save this extra money, but you want to invest it in assets that should see their value go up just as homeowners can see their property values rise. This way, you can put the money to work for yourself. Stocks are a good option, and you can pick an ETF that tracks the performance of the market if you don't know how to pick individual companies to invest in. 

By making sure you're setting aside a good portion of your money for wealth building -- and ideally automating your investments so you never miss one -- you can have a high net worth even without a home that you own and that's one of your most valuable assets.