How to Calculate Your Net Worth — The Number That Shows If You're Actually Getting Ahead

Net worth = total assets − total liabilities. Your income is what comes in; your net worth is what stays. A household earning $200,000 and spending $195,000 builds the same net worth as one earning $80,000 and spending $60,000. Income level matters less than the gap between earning and spending.

• Positive net worth: you own more than you owe
• Zero net worth: common in your 20s — normal starting point
• Negative net worth: liabilities exceed assets — also normal early on, not a crisis

The trend matters more than the absolute number. Growing net worth by $15,000 in a year is real progress whether you started at -$30,000 or $200,000.

• Cash, checking, savings, and money market accounts
• Retirement accounts: 401(k), IRA, Roth IRA — use current balance
• Taxable brokerage and investment accounts
• Home: use realistic sale price, not peak Zillow estimate
• Other real estate at current market value
• Vehicles (optional — many planners exclude depreciating assets)

• Mortgage outstanding balance (not original loan)
• Auto loan balances
• Student loan balances
• Credit card balances you currently owe
• Personal loans and lines of credit

Do NOT include monthly bills — rent, utilities, subscriptions. Those are expenses, not liabilities. Only count debts with outstanding balances.

• Under 35: $39,000
• 35–44: $135,000
• 45–54: $247,000
• 55–64: $365,000
• 65–74: $410,000

Use median benchmarks — the mean is heavily skewed by ultra-wealthy households. Being below median is data, not failure. The question to answer: are you trending in the right direction?

Calculate net worth once per year at the same date. Track it in a spreadsheet. Year-over-year change is your real financial scorecard — it captures everything: savings, investment growth, debt paydown, and spending behavior in one line.