How to use the net worth calculator
The calculator has two tabs. Net worth is a snapshot of where you stand today. Projection shows where you could be in the years ahead.
Net worth tab
- Assets. Enter what each thing you own is worth today. Use your latest statements for bank, brokerage and retirement accounts, a recent sale price of similar homes for your house, and a used-car guide value for vehicles. Rename, add or remove rows to match what you have.
- Liabilities. Enter the current balance on each debt: mortgage, car loan, student loans, credit cards, personal loans. Use the payoff balance, not the original loan amount.
- Liquid assets (optional). Add up only cash and investments you could sell within days without penalty, such as checking, savings and taxable brokerage accounts. This gives your liquid net worth.
Projection tab
- Enter total assets and total debt from the first tab.
- Add what you save and invest each month, the expected return on your assets, and how much debt principal you repay each month.
- Choose how many years to project. The chart and table show assets, debt and net worth for each year.
The net worth formula
Debt-to-asset ratio = Total liabilities ÷ Total assets
Liquid net worth = Liquid assets − Total liabilitiesAssets are valued at what they would sell for today. Liabilities are current payoff balances.
The projection adds one month at a time:
Debtnext month = Debt − Principal repaid (never below zero)r is the expected annual return on all assets. Net worth each year is assets minus debt at the end of that year.
A worked example
The example household owns a home, retirement accounts, a brokerage account, cash and a car worth $595,000 in total, and owes $279,500, mostly on the mortgage. Its net worth is $315,500.
Debt equals 47.0% of assets. The home alone is 63.9% of everything the household owns, and only $52,000 is liquid. Subtract all debts from that, and liquid net worth is -$227,500.
In the Projection tab, saving $1,200 a month, earning 5% a year on assets and repaying $900 of debt principal a month, net worth grows to $2,002,178 in 20 years. Of the increase, $288,000 comes from new saving, $216,000 from paying down debt and $1,182,678 from investment growth.
Reading your result
Net worth is the single number that sums up your finances. It rises when you save, when your investments and home gain value and when you pay down debt, and falls with new borrowing, spending from savings and falling markets.
The debt-to-asset ratio shows how much of what you own is financed. Recent homebuyers often have a high ratio because the mortgage is new; it falls as the loan is repaid and the home gains value. A ratio near or above 100% means a fall in asset values could leave you owing more than you own.
Liquid net worth answers a narrower question: how much could you actually draw on if you needed money soon? It is often negative for homeowners, as it is in the example, because the mortgage counts against it while the house does not. That is normal. It is a reason to keep an emergency fund in cash, not a sign that the overall position is weak.
A starting position looks different for someone early in a career:
With $27,000 in savings, a small 401(k) and a car, against $49,500 of student loans, a car loan and credit cards, net worth is -$22,500. That is a common starting point. The projection tab shows how steady saving and debt payments turn it around.
What drives net worth growth
When assets are small, net worth grows mainly from what you save and the debt you repay. As assets build up, investment growth takes over, because returns are earned on an ever larger balance. The example household already owns enough that growth outweighs new saving from the first year, and over 20 years it adds $1,182,678 against $288,000 of deposits.
| Scenario | Net worth at the end | From growth |
|---|---|---|
| 10 years | $982,928 | $415,428 |
| 20 years (example) | $2,002,178 | $1,182,678 |
| 30 years | $3,550,007 | $2,523,007 |
| 20 years, 3% return | $1,403,362 | $583,862 |
| 20 years, 7% return | $2,848,006 | $2,028,506 |
| 20 years, saving $600 a month | $1,758,695 | $1,083,195 |
| 20 years, saving $2,000 a month | $2,326,821 | $1,315,321 |
The return assumption moves the result the most over long periods, which is why it deserves a cautious figure. A home typically appreciates more slowly than a stock portfolio, and cash in the bank barely keeps pace with inflation, so a blended rate should reflect what you actually hold.
What this calculator does not include
- Inflation. Projected values are in future dollars. To see them in today’s money, enter a return after inflation, for example 5% minus 2.5% inflation.
- Taxes and selling costs. Selling a home costs agent fees and closing costs; pre-tax retirement accounts owe income tax on withdrawal; investments may owe capital gains tax.
- Changing balances. Real mortgage principal payments rise over time as interest falls; the projection uses a fixed monthly amount.
- Market swings. Returns vary from year to year. The projection shows a smooth path that real portfolios will not follow.
- Income and spending. Net worth does not show cash flow. The budget calculator helps find the monthly saving to enter here.