1. What is Net Worth?

Net worth is the value of all assets owned minus all liabilities owed. It's a key measure of financial health that provides a snapshot of an individual's or entity's current financial position.

2. How Does the Calculator Work?

The calculator uses the simple net worth formula:

Where:

• Assets — Everything you own that has monetary value (cash, investments, property, vehicles, etc.)
• Liabilities — Everything you owe (mortgages, loans, credit card debt, etc.)

Explanation: The calculation provides a dollar amount representing what would be left if you sold all assets and paid off all debts.

3. Importance of Net Worth Calculation

Details: Tracking net worth over time helps measure financial progress, assess financial health, and make informed decisions about saving, investing, and debt management.

4. Using the Calculator

Tips: Enter total value of all assets and total amount of all liabilities in USD. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What counts as an asset?
A: Assets include cash, bank accounts, investments, real estate, vehicles, valuables, and any other property with monetary value.

Q2: What counts as a liability?
A: Liabilities include mortgages, car loans, student loans, credit card balances, personal loans, and any other outstanding debts.

Q3: How often should I calculate my net worth?
A: Many financial experts recommend calculating net worth at least quarterly to track financial progress.

Q4: What is a good net worth?
A: This varies by age and life circumstances, but generally a positive and growing net worth indicates good financial health.

Q5: Should I include my home in assets?
A: Yes, but use the current market value (not purchase price) and remember to include the mortgage as a liability.