Net Worth

Net worth is total assets minus total liabilities. Assets include cash, investments, retirement accounts, and the market value of property; liabilities include mortgages, student loans, car loans, and card balances.

It is a better health check than income because it captures what you have kept rather than what you earned. A high earner carrying substantial debt can have a lower net worth than a moderate earner who saves consistently.

A negative net worth is common and not alarming on its own — recent graduates with student loans routinely start there. What matters is the trajectory.

Tracking it quarterly, on a single sheet, surfaces trends that month-to-month budgeting misses: whether debt is genuinely falling, whether investments are growing faster than liabilities, whether a raise translated into wealth or just into spending.