Net Worth
Net worth is calculated as:
Net Worth = Total Assets − Total Liabilities
It represents the dollar amount you would have remaining if you sold every asset and paid off every debt. A positive net worth means you own more than you owe. A negative net worth means your debts exceed your assets.
What Counts as an Asset
- Cash, checking, and savings accounts
- Investment and brokerage accounts
- Retirement accounts (401k, IRA, Roth IRA)
- Real estate (current market value)
- Vehicle market value
- Business equity and receivables
What Counts as a Liability
- Mortgage balance
- Auto loan balance
- Student loan balances
- Credit card debt
- Personal loans and lines of credit
US Median Net Worth by Age (2023)
| Age Group | Median Net Worth | |-----------|-----------------| | Under 35 | $39,000 | | 35–44 | $135,000 | | 45–54 | $247,000 | | 55–64 | $364,000 | | 65–74 | $410,000 |
Why It Matters
Net worth is the most honest financial number because it captures the totality of financial decisions — spending, saving, investing, and debt management — in a single figure. An income statement shows flows; net worth shows the cumulative stock of wealth.
Related Tools
- Net Worth Calculator — Calculate your net worth instantly by entering assets and liabilities.
- Compound Interest Calculator — Model how savings grow to build net worth.
- Debt-to-Income Calculator — Assess leverage alongside net worth.
→ Read the full guide: How to Calculate Your Net Worth