How to Calculate Your Net Worth

Your net worth is a snapshot of the value of what you own minus what you owe. If you have a negative net worth, then you owe more than what you have available to you. A positive net worth means the value of what you own is greater than the amount that you owe.

If you have dreams of becoming rich, knowing and monitoring your net worth is important. Here’s how to calculate your net worth so you can grow your personal wealth.

How to calculate your net worth

To find your net worth, you’ll first need current figures for everything you own and everything you owe.

Collect the following information:

• Real estate ownership papers
• Current registered and non-registered investment statements
• Current values on recreational vehicles and automobiles
• Bank account statements
• All mortgage statements
• Credit card statements
• Student, automobile, bank loan, credit line and personal loan statements
• Life insurance statements

Once you have all your information, you can begin calculating your net worth by starting with a list of all of your assets, which are anything of value that you own that increases your net worth.

List tangible assets

Now that you have all of the information you need, it’s time to really dig into it. First up: tangible assets.

Tangible assets are items of value with physical properties. In other words, these are assets that you can touch. List and assign dollar values to all tangible assets such as:

• Residence
• Vacation home
• Rental properties
• Investment real estate
• Furniture
• Cars
• Sports or vintage automobiles
• Recreational equipment such as boats, snow machines or RVs
• Art
• Jewelry

Add up the dollar value of all of these items to find your total tangible assets.

List equity assets

Equity assets are your ownership interests in businesses, including stocks held in retirement accounts.

List and assign dollar values to all equity assets such as:

• Stocks
• Variable annuities
• Limited partnerships
• Business interests
• Any retirement accounts such as a 401k or IRA

Add up the dollar values of all items to find your total equity assets.

List fixed-income assets

Next, you need to list your fixed-income assets. Your fixed-income assets include long-term investments that pay interest on a fixed schedule.

Fixed-income assets can include:

• U.S. government bonds and securities
• Municipal bonds
• Corporate bonds
• Bond mutual funds

Add up the dollar values of all items you own in this category to find your total fixed-income assets.

List cash and cash equivalents

Cash equivalents refer to short-term accounts and investments that can be cashed in for emergencies. Include all the cash sitting in your checking and savings accounts, as well as all other easily liquidated money market funds.

Typical assets in this category include:

• Checking account balances
• Savings account balances
• Money market mutual fund balances
• Certificates of deposit
• Other cash reserves

Add up the dollar values of these items to find your total cash and cash equivalents.

Once you have all of your assets listed, it’s time to sum up your total assets. To determine your total assets, add up the totals of each asset category:

• Tangible assets
• Equity assets
• Fixed-income assets
• Cash and cash equivalents
• Other assets

List your liabilities

Next, it’s time to list your liabilities. A liability is money owed by an individual or business that decreases net worth.

Liabilities include:

• Home mortgage
• Other mortgages, such as vacation property or rental property
• Home equity line of credit
• Home equity loan
• Auto loans
• Bank loans
• Student loans
• Personal credit line balances
• Balances on credit cards
• Personal loans
• Other debts or money you owe

Add up the dollar values of each of these items to get your total liabilities.