How net worth works
Net worth is the single clearest snapshot of your finances: the market value of everything you own minus the balance of everything you owe. Income tells you how fast money flows through your life; net worth tells you how much of it you have actually kept. A negative number is common early on - a fresh graduate with student loans and no assets almost always starts below zero, and that says nothing about where they will end up.
This calculator also reports your liquid net worth, which strips out your home and vehicles before subtracting all debts. It is deliberately harsher: you can't pay a bill with the house you live in, so liquid net worth shows how much cushion you would truly have in an emergency. Recalculate a few times a year - the direction of the number matters far more than the number itself.
Frequently asked questions
What counts in net worth?
Everything you own at its current market value - cash, investments, retirement accounts, your home, vehicles - minus everything you owe. Pensions are the tricky case: a guaranteed pension has real value but no account balance, so many people track it separately.
Should I include my home in net worth?
Yes, for your total net worth - home equity is real wealth. But also track liquid net worth, which excludes your home and vehicles, because you can't easily spend the house you live in. Both numbers together tell the full story.
What is the median net worth benchmark?
Median net worth varies hugely by age - from close to zero for people in their twenties to several hundred thousand dollars near retirement. Comparing yourself to medians is less useful than watching your own number: the trend matters far more than the level.