How to calculate net worth
Add up what you own, subtract what you owe, and track the result month by month: what to count, what to leave out, and a worked example.
Updated November 3, 2026
The formula
Net worth is everything you own minus everything you owe:
net worth = total assets − total debts
The math is one subtraction. The work is in deciding what to count, valuing it honestly, and doing it the same way every month so the numbers compare.
What counts as an asset
- Cash: checking, savings, money market accounts, CDs.
- Investments: brokerage accounts, at their market value on the day you check.
- Retirement accounts: 401(k), 403(b), IRA, Roth IRA. Use the balance on the statement; it is before any tax you would owe when you take the money out.
- Real estate: your home and any rentals, at a realistic market value. Online estimates are a starting point, not a fact.
- Vehicles: what you could sell them for today, which goes down every year.
- Other: a business you own, money someone owes you, HSA balances.
Leave out everyday belongings like furniture and clothes. They are worth far less than they cost and only add guesswork.
What counts as a debt
- Mortgage and home equity loans: the payoff balance, not the original loan.
- Car loans, student loans and personal loans.
- Credit cards: the current balance, even if you pay it in full each month.
- Medical bills, tax you owe, money you owe family.
How to track it month by month
A single net worth number tells you little. The trend tells you a lot. Set up a sheet with one row per account and one column per month, and once a month type in each balance:
- Pick a fixed day, such as the last day of the month, and use the balances on or near that day.
- Add up the asset rows and the debt rows separately, then subtract.
- Add a row for the change from last month, and look at the change over 12 months as well. Markets move; a year smooths that out.
- Keep the home and car values steady unless something real changes. Re-estimating them every month adds noise.
Worked example
A couple in their mid-thirties, nine assets and four debts. These are the sample numbers in the Reamwise Net Worth Spreadsheet for June 2025, so you can check them against the file.
| Assets | June 2025 |
|---|---|
| Cash | 33,159.46 |
| Investments | 20,261.41 |
| Retirement | 185,483.77 |
| Real estate | 421,000.00 |
| Vehicles | 31,160.00 |
| Total assets | 691,064.64 |
| Debts | June 2025 |
|---|---|
| Mortgage | 329,028.25 |
| Car loan | 10,108.31 |
| Student loan | 20,553.03 |
| Credit card | 1,940.62 |
| Total debts | 361,630.21 |
Net worth is 691,064.64 − 361,630.21 = $329,434.43. A year earlier it was $265,022.01, so it grew $64,412.42, or 24.3%. Debts are 52.3% of assets, down from 58.8% a year before.
Not every month went up. In April 2025 a market drop cut the retirement and brokerage accounts, and net worth fell $13,046.63 in one month. Over twelve months it barely shows. That is why the trend matters more than any one reading.
Most of this couple's net worth is the home: home equity is $91,971.75. Without it, their net worth is $237,462.68, which is the part they could reach without selling the house.
Common mistakes
- Valuing the car at what you paid. Use what it would sell for now.
- Counting the home at the top online estimate. Pick a cautious value and keep it steady.
- Forgetting a debt. A 0% store card or a loan from family still counts.
- Comparing to other people. Net worth by age tables are averages over very different lives. Compare with your own last year.
- Checking every day. Investment balances jump around. Once a month is plenty.
Questions
How do I calculate my net worth?
Add up the value of everything you own, add up everything you owe, and subtract the second total from the first.
Can net worth be negative?
Yes, and it often is early on, for example with student loans and little savings. What matters is that it moves up over time.
Should I count my retirement accounts?
Yes, at the statement balance. Some people also track net worth without retirement accounts, since that money is hard to reach before retirement.
Should my home be in my net worth?
Most people include it, with the mortgage as a debt. Tracking net worth without home equity as well shows how much is outside the house.
How often should I calculate net worth?
Monthly or quarterly. More often mostly shows market noise.
What is a good debt-to-asset ratio?
There is no single right number, and a new mortgage pushes it up. Watch whether yours is falling over time.
Summary
Net worth is total assets minus total debts. Count cash, investments, retirement accounts, real estate and vehicles at realistic values, subtract every balance you owe, and repeat on the same day each month. In the example, $691,064.64 in assets and $361,630.21 in debts make a net worth of $329,434.43, up 24.3% in a year despite one bad month. The Net Worth Spreadsheet keeps 24 months of balances and draws the trend for you; to save toward specific goals alongside it, see the Savings Goal Tracker.
Disclaimer. For general information only. Not tax, legal or financial advice. Check the rules for your country or ask a qualified adviser. Read the full disclaimer.