A Net Worth Statement — The Best Money Measurement

Photo by Carlos Muza on Unsplash

No doubt you’ve heard the term “net worth” before. No?

Simple: Your net worth is the assets minus liabilities. In other words, it’s what you own minus what you owe.

Things you own include:

· Home(s)
· Auto(s)
· Cash in the bank
· Cash in the sock drawer
· 401(k)
· IRAs
· Brokerage Accounts

Debts you owe include:

· Mortgage
· Car loan
· Revolving credit card debt
· Student loans
· Back taxes, liens, civil judgments

My example (as of 10/2021):

What I Own
Home: $0 (I rent)
Car: $24,725
Cash in the bank: $125,196
Retirement Accounts: $523,723
Brokerage: $17,097
HSA: $27,935

TOTAL: $718,676

What I Owe
Credit card: $0 (they’re paid in full each month)
Car: $0
Student loans: $86,970 (don’t judge)