Personal Finance

Money tip – Calculate your net worth

Knowing your net worth is a very important aspect of personal finance. How can you know if you are getting ahead financially if you have no way to track or measure your wealth? If you want to have a benchmark for wealth, retirement or financial fitness, make sure your starting point is your net worth.

I equate knowing your net worth for wealth management to knowing your weight for weight management. Creating a net worth statement is a basic skill you should know and practice regularly.

How to calculate your worth?

Down below, I will give you a list of tools and resources to help you figure out your net worth but really all you need is a pen and paper.

Take a piece of paper and draw a line down the middle of the page from top to bottom. On the left side of the page write down all the assets that you think contribute positively to your financial well-being (not depreciating assets). On the other side of the page, list all your debts or liabilities. At the bottom of the page, take your total assets and subtract your total liabilities and you will have your net worth.

Once you have this starting point, every year, you should redo this calculation to see if you are moving in the right direction. Understanding your net worth is the starting point to financial planning and wealth management.

Personalize your net worth statement

There is no shortage of tools and resources out there to help you figure out your worth. In my opinion, use the one that works best for you.

Here’s a link to a net worth statement I give out to people who attend my financial workshops. It’s not the best or the worst but a great starting point.

Net Worth Statement (7444 downloads)

Here’s a link to some excel spreadsheets. Don’t expect much. There’s nothing fancy about these worksheets but that’s realty the point. It does not have to be fancy. Incidentally, this is the spreadsheet I’ve been using for years (the long term tab). Mine is personalized for my needs and I would encourage you to do the same for yourself. Take this template and personalize it to your assets and liabilities.

Excel spreadsheet to track net worth (8847 downloads)

For those of you that prefer links to online calculators, here’s a couple to start with.



I don’t use online calculators to calculate my personal worth so does anyone that wants to share what they have found helpful, please share in the comments.

Your homework

If you’ve never tracked your worth, it’s time to get started. Using any of the strategies above, make it a priority to complete your net worth statement.

For those of you who are more seasoned at this, help others by sharing he tools, calculators and strategies your use to calculate your net worth.


  1. Bill

    I use Excel monthly. After much thought I leave my home off the list. Why? I don’t plan on selling it anytime soon. The price fluctuates year to year. Any price I use is an estimate, as what it is worth is really only determined when I sell. Finally, I fear it ‘distorts’ the view of my net worth. In a concession to tracking I have the market value assessment of my home (once per year) after I calc. my NW. I also leave off my vehicle (paid for anyways) and furnishings.

    So the focus is on my liquid assets and investments. I do include my mortgage since I have to pay that off. However I can control the risks with investments and how much I pay my mortgage. It works for me. and that’s the main point.

    • Jim Yih

      Thanks for sharing Bill. Many people debate the items that belong on the Net Worth Statement. Personally, I do not include depreciating assets like cars. I also do not include personal assets like furniture, clothes, etc. I call these lifestyle assets and I do not think they contribute to my wealth.

      I do include the house in my net worth statement because it is a significant asset and although I do not plan to sell it, I still can access the equity if needed.

      It’s important to use the net worth statement the way you think it should be used. In other words, it is personal. That’s why I appreciate you sharing as it will help other people think.

  2. Nate

    Great explanation of figuring out your net worth. One thing I would add is that it’s a good idea to check your net worth every year or so, and see how well you are doing at increasing it. That way you’ll spot problems before they have time to really hurt your financial situation.

    • Jim Yih

      thanks Nate!
      I could not agree more. If you look at the down-loadable excel sheet in the post, you can track your net worth year by year using one worksheet. This is what I use.
      Have fun!

  3. CF

    Nicely formatted! What do you include in “other assets”? Do you bother including retail consumer items – laptops, tvs, etc?

    I started keeping track of my net worth two years ago and have found it to be an excellent motivational tool.

  4. Bernie

    I really enjoy your retirement blog, especially as I’m also retired now.

    I have a question on calculation of Net Worth that puzzles me. I have a company pension plan that pays me a fixed monthly distribution. Net Worth statements typically ask a dollar figure amount of registed pension plans. This info isn’t known for my pension plan. Is there a way to calculate this figure from my monthly distribution?

    • Paul Rastas

      I have been monitoring my net worth for over 30 years, and I have always ignored the value of my wife’s defined benefit pension plan as I do not feel that including it adds value to the exercise of monitoring changes in net worth. While it contributes huge value to your lifestyle, it is not really an available asset other than the monthly cash flow. It cannot be transferred, assigned or bequeathed.
      The value however can be quantified as divorce lawyers will attest.

      If you really need a guess of value, a reasonable guestimation formula follows.

      The monthly payment, say $1,000, times 12 indicates an annual return of $12,000. Take the $12,000 and divide by a reasonable long term interest rate, say 4% to get $300,000. The $300,000 represents the approximate value of an indefinate cash flow stream of $1,000 per month at a 4% return. A larger assumed rate of return will indicate a smaller value and vice versa.

      Note that the $300,000 in this example represents the value of an indefinite cash flow stream. If you are age 60, this is still a reasonable estimate of the value of this cash flow for the rest of your life. However, as you age, the value diminishes as the cash flow terminates at death. To get an approximation of the value at any age you might multiply the $300,000 by a factor of the number of years to age 90 divided by 30. ie, at age 60, the value would approximate $300,000 x 30/30 = $300,000. At age 75, the value would approximate $300,000 x 15/30 = $150,000.

      Note that these ‘calculations’ result in oversimplified estimates only. The real value is influenced by the chosen interest rate, actuarial lifespan estimates, survivor benefits if any, and other factors.

      Contact the pension plan administrator for a more precise valuation.

  5. Gail

    If I take my CPP at 60 will this in any way affect my Registered Pension Plan that I have with my place of employment. It will give me about $200/month if I start to draw this by the end of this year

  6. Gail

    If i take my CPP at 60 will this in any way affect my Registered Pension Plan that I have with my place of employment or my early CPP. It will be about $200/mon if I start to draw this by the end of this year.

  7. Dale

    Give this one a try. It is comprehensive, yet simple to use.

  8. Paul Rastas

    Interesting discussion, Jim.
    I agree with Nate, that you should update your net worth regularly to see how you are doing. For the same reason, I include my home, cars and boats. After a couple of years it becomes very apparent what is a good investment (home) and what is not an investment at all (cars and boats). It is however informative to see how different classes of assets change in value from year to year. This could perhaps give you some direction as to judicious allocation of resources. If the house, vehicles and vessels are financed, you MUST include the debt in the liabilities section; why would you not include the assets in the assets section?

    Most people will include the RRSP on the net worth. Fair enough, but what is not well understood or practiced is that you MUST also include the inherent tax obligation as a liability. Otherwise you are significantly overstating your net worth, as the RRSP is not fully liquid without incurring some level of tax, close to 50% if the RRSP is in six figures.

    • Rey mayo

      I think net worth is starting point. What is important is how you maintain your net worth while maintaining your personal lifestyle and standard of living on a monthly basis.

      • Paul Rastas

        Agreed that net worth is a starting point. Then it becomes more useful as you check the net worth periodically to see how you are progressing, like a financial report card. If net worth is deteriorating it is an indication that perhaps you are overspending on lifestyle and standard of living, possibly by using your home equity LOC as an ATM. This is not a short term monthly exercise, but an indicator over a several year period. For example, over a five year period your vehicle value might go from $40,000 to $10,000. If your vehicle debt went down by a similar amount then your net worth does not suffer. Your home value might have gone from $500,000 to $600,000. If your mortgage debt went down during this period, your net worth (wealth) is growing. If your home equity LOC went from $300,000 to $450,000 it is an indicator of trouble ahead, unless the $150,000 in advances went to some other measureable investment on your net worth schedule.

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