Net Worth
Total assets minus total liabilities. The single best snapshot of financial position.
Definition
Assets include cash, investments, real estate equity, and vehicles at resale value. Liabilities include mortgage balance, loans, and credit card debt. Net worth can be negative — and often is for young adults with student debt. Liquid net worth excludes home equity and vehicles for a more usable wealth figure.
Formula
net_worth = total_assets − total_liabilities
Related wealth terms
One of 40 glossary terms. Browse the full glossary →