How to Calculate Net Worth
What is Net Worth?
Net worth is the total value of everything you own (assets) minus everything you owe (liabilities). It is the most comprehensive snapshot of personal or business financial health at a single point in time.
Step-by-Step Guide
- 1List all assets: cash, investments, property, vehicles, valuables
- 2List all liabilities: mortgages, loans, credit card balances, taxes owed
- 3Sum each category separately
- 4Net worth = Total assets − Total liabilities
Worked Examples
Input
Assets $350,000 · Liabilities $180,000
Result
$170,000 net worth
Positive net worth — assets exceed debts
Input
Assets $80,000 · Liabilities $95,000
Result
−$15,000 net worth
Negative net worth — common early in career