What is a good net worth?

There's no single "good" number, because it depends heavily on your age, income, and stage of life. A helpful benchmark is the median U.S. household net worth of $192,700 reported by the Federal Reserve for 2022, but the most useful comparison is your own past number. If your net worth is trending upward year over year, you're doing well regardless of how you stack up against averages.

How do I calculate my net worth?

Add up the value of everything you own, including cash, savings, investments, retirement accounts, and real estate, to get your total assets. Then add up everything you owe, such as your mortgage, car loans, student loans, and credit card debt, to get your total liabilities. Subtract your liabilities from your assets, and the result is your net worth. A net worth tracker or calculator can do this math automatically.

How often should I check my net worth?

Once a month works well for most people. It's frequent enough to keep you engaged and spot trends, but not so often that everyday market fluctuations cause stress. If monthly feels like too much, quarterly is a fine alternative. The key is to track at consistent intervals so you can see a genuine trend rather than random snapshots.

Should I include my home in my net worth?

Yes, your home is typically your largest asset, so it belongs in the calculation. Use a realistic estimate of what it would sell for today, and remember to list your remaining mortgage balance as a liability. Because a home isn't easily converted to cash, some people also track a "liquid net worth" that excludes property to see how much they could access quickly if needed.

What's the difference between net worth and income?

Income is the money that flows in over a period of time, like your salary or side earnings, while net worth is a snapshot of your total wealth at a single moment. A high income doesn't automatically mean a high net worth; someone who earns a lot but spends it all can have a lower net worth than a modest earner who saves consistently. Net worth measures what you keep, not just what you make.

Can I grow my net worth while paying off debt?

Definitely. Every debt payment reduces your liabilities, which directly increases your net worth. Many people grow their net worth fastest during their debt-payoff years because each payment delivers a guaranteed return. If you can save even a small amount while paying down debt, you'll build assets and shrink liabilities at the same time, moving your number up from both directions.

Why is tracking net worth better than checking my bank balance?

Your bank balance only shows the cash in one account at one moment, which swings dramatically between paydays and bills. Net worth captures your entire financial position, including investments, retirement accounts, and debts. Tracking it over time reveals whether you're truly building wealth, something a bank balance simply can't tell you. It's the difference between a single frame and the whole movie.