Subtract Total Liabilities from Total Assets
To find your net worth, subtract your total liabilities from your total assets. Assets are what you own, and liabilities are what you owe. The result is your net worth.
List assets such as cash, investments, retirement accounts, and real estate. List liabilities such as credit card balances, loans, and mortgages. Use current balances for accuracy.
Why Subtracting Liabilities Matters
Subtracting liabilities shows your true financial position. A positive number means you own more than you owe. A negative number means your debts exceed your assets.
Tracking this calculation over time helps you see if you are gaining or losing wealth. It is a simple, standard measure used by advisors and institutions.
Use Reliable Tools and Sources
You can calculate net worth manually or with a spreadsheet. Many personal finance platforms automate the math and connect to accounts for up-to-date numbers.
For more guidance on assets and liabilities, see the Consumer Financial Protection Bureau guide on understanding net worth.
