How Does Your Net Worth Compare

Your personal net worth is a number that represents the total of your assets minus your liabilities at one moment in time. It’s useful to measure your financial progress, especially if you calculate it annually, as it will allow you to see whether the decisions you’re making are improving or decreasing your net worth. It is possible to have a negative net worth, if you owe more than you own. If you discover your net worth is negative, you’ll need to take steps to pay off debts as soon as possible.

How to Calculate Your Net Worth

Assets: On a sheet of paper or a spreadsheet, list your largest assets. For the majority of people, your largest assets would consist of your home if you’re a homeowner, and your cars. It may include boats, vacation homes, campers, etc. Use accurate estimations for what each is worth in current dollars.

Next, list your liquid assets from checking accounts, cash on hand, savings accounts, certificate of deposits, and retirement accounts. Get your most recent statements for all accounts to have the most accurate representation of value.

Next, list personal items that may be valuable. Jewelry, antiques, collections, musical instruments, electronics, etc. You shouldn’t make a list of everything you own, but try to include anything that has a value of $500 or more.

Get the total value of all of the assets you’ve listed. This is your “total assets”.

Liabilities: On the other side of your paper or spreadsheet, begin listing your largest liabilities – money owed on a mortgage, car loan, boat loan, etc.

Follow by listing money owed on personal loans, student loans, credit cards and any other debts that need to be repaid.

Add everything on your liabilities list to come up with your “total liabilities”.

Calculate: Once you have your two totals, subtract your total liabilities from your total assets. This is your net worth. If it’s positive, you’ve been moving in the right direction! If it’s a negative number, you need to cut down on debts.

If you calculate your net worth annually, you’ll be able to compare it from one year to the next and determine if you’re moving in the right direction financially – or if you are getting more and more behind by adding more debts.

How Do You Measure Up?

It’s not necessary to measure your net worth against other people, but if you’re wondering whether you have an average net worth you can visit Not only can you use this site to calculate your net worth, but you can look at other people who post theirs publicly, as well, and see how other people are managing their money. Just because someone has a bigger house than you doesn’t necessarily mean they are better at managing their money or have a greater net worth.

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