Guide
Calculate your net worth by totaling assets minus liabilities. Track progress over time and understand where your wealth is concentrated — the first step toward any financial plan.
What Counts as Assets and Liabilities
Assets include cash, investments, retirement accounts, real estate equity, vehicles, and valuable personal property. Liabilities include mortgages, student loans, credit cards, auto loans, and any other debts.
Use realistic values — Zillow estimates for homes, Kelley Blue Book for cars, and current account balances for investments.
Why Net Worth Matters More Than Income
High earners can have low net worth if they spend everything. Modest earners who save consistently can build substantial wealth. Net worth measures what you have kept, not what you have earned.
Track net worth quarterly. The trend matters more than any single snapshot — consistent upward movement signals healthy financial habits.
Key Takeaways
- Net worth = total assets minus total liabilities.
- Track quarterly to spot trends and stay motivated.
- Paying down debt increases net worth as much as saving cash.
- Aim to grow investable assets faster than lifestyle inflation.