Net Worth

Last updated:
September 16, 2021

We define "Net Worth" as your assets minus your debts.

An "asset" is anything that you own that has monetary value. A few examples of assets are cash, stock, real estate, and collectables. There are of course intangible assets like talent, education, and connections, but those are hard to measure, so they are not included in an asset or net worth calculation. There are also tangible assets that are hard to value, either because they are rare, or hard to sell. A common example of these kinds of assets are stock options in a privately held company.

Many people have "equity" in a property like a home that has a mortgage lien against it. When you buy a home, the down payment you hand over at the closing is your starting home equity. This will grow as you pay down the principal on your mortgage. We include home equity, the equity in a car or other partially owned assets in your asset calculation.

A "debt" (also often called a "liability") is an obligation or promise to pay someone else. Common debts include mortgages, credit card balances, student loans, and car loans.

A positive Net Worth means that you have more assets than debts. A negative Net Worth means the opposite.

One of the main numbers we report is "Current Net Worth". This is an at-the-moment calculation that takes our best estimate of the present value of your assets minus the sum of your current debts.

In our graphs, we project your Net Worth by time period, with the minimum period size being one month. On the upper right hand side of your screen, you can change your view between income & expenses, assets & debts and net worth at any time. If you select the net worth view, you’ll be able to observe your projected net worth fluctuations over time. If you’d like to adjust the period of your net worth view, you can select a new period from the drop down list available at the upper right hand side of your screen. You can also click on the individual bars in your net worth view to see your projected changes.