1. What is Net Worth?

Net worth is a measure of financial health calculated by subtracting liabilities from assets. It provides a snapshot of an individual's or household's financial position at a given point in time.

2. How Does the Calculator Work?

The calculator uses the simple net worth formula:

Where:

• \( \text{Assets} \) — Everything you own that has monetary value (cash, investments, property, etc.)
• \( \text{Liabilities} \) — Everything you owe (loans, mortgages, credit card debt, etc.)

Explanation: The age factor helps compare your net worth to typical ranges for your age group globally.

3. Importance of Net Worth Calculation

Details: Tracking net worth over time helps measure financial progress, plan for retirement, and make informed financial decisions. Comparing to age group averages provides context for your financial situation.

4. Using the Calculator

Tips: Enter all values in USD. Include all assets (savings, investments, property values) and all debts (mortgages, loans, credit cards). Age helps provide age-appropriate benchmarks.

5. Frequently Asked Questions (FAQ)

Q1: What's a good net worth by age?
A: While it varies globally, general benchmarks suggest: 30s - 1x annual salary, 40s - 3x, 50s - 5x, 60s - 7-8x. However, these vary significantly by country and cost of living.

Q2: Should I include my home in assets?
A: Yes, include your home's current market value as an asset and your mortgage as a liability.

Q3: How often should I calculate my net worth?
A: Ideally quarterly to track progress, but at minimum annually.

Q4: Does net worth include retirement accounts?
A: Yes, include all retirement accounts at their current value.

Q5: What's more important - income or net worth?
A: Both matter, but net worth better reflects long-term financial health as it accounts for savings and debt.