Knowing how to calculate your net worth is no luxury – it’s a personal financial necessity.
Your net worth establishes the progress you’re making on an ongoing basis, and helps shape future financial decisions that involve assets and debt. Such decisions could include buying a home, getting married, having a baby and starting your own business, among other “big picture” household financial scenarios.
Having the right figures via a net worth calculation makes those decisions and scenarios easier to evaluate. Not having a good grip on your net worth has the opposite effect. As a result, serious financial mistakes can be made without the knowledge of your net worth and the impact that figure has in big money decisions.