How to calculate your net worth

As you work toward achieving your financial goals, it is a good idea to measure your progress. Calculating your net worth is as simple as comparing what you owe (called liabilities) and what you own (called assets).  

Liabilities are the debts that you owe to someone else such as a mortgage, an auto loan, credit card debt, student loan, or other types of loans. The sum of all of the money you owe equals your total liabilities.

Assets are defined as physical property, such as a home or a car; monetary property, such as mutual funds or certificates of deposit; or intangible rights, such as money owed to you by someone else. The sum of all of the money you own equals your total assets.

The difference between your assets and your liabilities is your net worth.

Don't be discouraged if your net worth is negative – keep in mind that this should be an accurate depiction of your financial situation.  You can start to increase your net worth by decreasing your liabilities, increasing your assets, or by doing both!

If this is the first time you have calculated your net worth, consider it as a benchmark that can be compared to your net worth next year and in future years. Annual net worth statements allow you to track your financial progress and help you to determine if the financial decisions you made throughout the year had a positive or negative effect on your net worth.

For help with calculating your net worth, use the simple Net Worth Worksheet from

You might also enjoy:

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How to stop debt collection calls

Kim McGrigg is the former Manager of Community and Media Relations for MMI.