Finance
Net worth calculator
The single figure that says most about a financial position, and the one people track least often.
Assets minus liabilities, and nothing else
Net worth is a snapshot of position, not of income. A surgeon earning a large salary with a large mortgage and no savings can have a lower net worth than a teacher who has been contributing to a pension for twenty years. Income is a flow; net worth is the level in the tank.
Include what you own at realistic market value, and what you owe at current balance. The common errors are optimism about house prices and forgetting a balance you never think about — an old car loan, a rolling overdraft, a buy-now-pay-later plan.
Liquid net worth is the more useful number
Total net worth counts the house you live in. That equity is real, but you cannot spend it without selling or borrowing against it, and if you sell you still have to live somewhere. Liquid net worth strips out property and vehicles and leaves what you could actually reach.
The gap between the two figures is worth watching. Someone with a net worth of $200,000 that is entirely house equity is in a very different position from someone with the same figure in index funds, even though the headline number matches.
Valuing the awkward things
- Property — use a realistic sale price, not a listing price or a zestimate. Subtract nothing for selling costs here, but know they run 2-5%.
- Cars — use trade-in value, not what you paid. Most cars lose 15-20% a year for the first several years.
- Pensions — use the current fund value. Defined-benefit schemes have no simple value; a transfer value if you have one is the nearest thing.
- Personal possessions — most of what you own is worth far less second-hand than it feels. Include only genuinely resaleable items and be pessimistic.
The number that matters is the change
A single reading tells you little. Measured every quarter on the same basis, net worth becomes the most honest feedback loop in personal finance, because it nets off the things a budget hides — you cannot pay down a card with a loan and appear to have progressed.
Negative net worth is normal for younger households with student debt or a recent mortgage, and it is not a failure. What matters is whether the line is rising. A net worth improving by a consistent amount each quarter is a healthier signal than a large but static one.
Common questions
Should I include my pension?
Yes. A pension is an asset you own, and excluding it badly understates the position of anyone who has been contributing for years. Use the current fund value; for a defined-benefit scheme, a transfer value is the closest equivalent.
Do I count my house at market value or equity?
Put the full market value in assets and the mortgage balance in liabilities. The calculator nets them, which gives the same answer as counting equity, but it also lets you see the debt-to-asset ratio.
What is liquid net worth?
Net worth excluding property and vehicles — cash and investments less short-term debts. It is what you could realistically access without selling your home, and is often the more useful figure for judging resilience.
Is negative net worth bad?
Not necessarily. It is the normal state for a recent graduate with student debt or a household that has just bought with a small deposit. The trend over several quarters says far more than the sign of a single reading.