Key idea
One honest number that captures your whole financial position: everything you own, minus everything you owe.
Your salary tells you what flows in. Your net worth tells you what has actually stuck: the single number that summarises where you stand. It takes fifteen minutes to find.
Net worth = What you own (assets) − What you owe (liabilities)
A worked example
| Assets & liabilities | Amount ₹ |
|---|---|
| Assets | Bank + FDs 3,20,000 |
| EPF balance 2,10,000 | |
| Mutual funds / stocks 1,40,000 | |
| Liabilities | Personal loan (1,80,000) |
| Credit-card dues (35,000) | |
| Net worth | 4,55,000 |
Don't flinch if your number is small or negative. A fresh graduate with an education loan often has a negative net worth, and that's normal. The number isn't a grade; it's a starting line.
Why measure it
The direction matters far more than the size. Check it every six months: a climbing number means your habits are working, however modest it looks today. Flat while you're earning well is a signal worth investigating. Net worth turns a vague "am I doing okay?" into something you can watch.
Finished reading?
Marking this complete counts today, and your streak becomes day 1.