How to Calculate Your Net Worth (And Why It Matters More Than Salary)
Your salary is what you earn. Your net worth is what you keep. One matters more than the other.
Two people earning $100,000/year can have net worths of $500,000 and negative $50,000. The difference is not income — it is the gap between earning and spending over time. Net worth is the only number that measures real financial progress.
The Formula
Net worth = Total Assets - Total Liabilities. Assets: savings, investments, retirement accounts, home equity, car value, valuables. Liabilities: mortgage balance, car loans, student loans, credit card debt, personal loans.
Benchmarks by Age (US)
Age 25: $10,000-25,000. Age 30: $50,000-100,000. Age 35: $100,000-250,000. Age 40: $200,000-500,000. Age 50: $500,000-1,200,000. Age 60: $800,000-2,000,000. These are targets for the 50th-75th percentile. Median American net worth at 35 is actually much lower ($40,000).
Track It Monthly
Update your net worth spreadsheet on the 1st of every month. Watching the number grow (even slowly) is the most motivating financial habit you can build. It makes saving feel like winning rather than sacrificing.
Calculate yours with our net worth calculator and build wealth with the FIRE calculator.