What Net Worth Means
Net worth is the difference between everything you own and everything you owe. It is a single number that summarizes your financial position at a specific point in time.
How to Calculate Net Worth
Add up the market value of assets such as cash, investments, real estate, and retirement accounts. Then subtract all liabilities, including mortgages, loans, and credit card balances. The result is your net worth.
Why Net Worth Matters
Net worth helps track wealth over time and compare financial progress across different income levels. It is used by lenders, advisors, and researchers to assess overall financial health.
