How to Calculate Net Worth — Assets, Liabilities & Financial Health

Net worth is the single best number to track your financial progress. It’s simple but powerful.

The formula

Net Worth = Total Assets − Total Liabilities

What counts as assets?

• Cash: Savings accounts, checking accounts, cash on hand
• Investments: Stocks, bonds, mutual funds, SIPs, fixed deposits
• Property: Home value, land, rental properties (market value)
• Retirement: 401(k), pension, PF, NPS
• Other: Vehicles, jewelry, business equity

What counts as liabilities?

• Loans: Home loan, car loan, education loan, personal loan
• Credit cards: Outstanding balances
• Other debts: Money owed to family, EMIs remaining

Net worth benchmarks by age

Age	Target Net Worth
25	0.5× annual income
30	1× annual income
35	2× annual income
40	3× annual income
45	4× annual income
50	6× annual income
60	8–10× annual income

Tips to grow net worth

1. Reduce high-interest debt first — Credit cards (15–40% APR) destroy wealth
2. Increase the gap — Earn more, spend less, invest the difference
3. Track quarterly — Seeing progress motivates consistency
4. Appreciate assets — Invest in things that grow (stocks, property) not depreciate (cars, gadgets)

Calculate yours with our Net Worth Calculator — add custom asset and liability categories for a complete picture.