You might think the term “net worth” only applies to celebrities and CEOs, but it’s something we all have and we all need to know it.
Calculated as the total value of your assets minus your debt, your net worth is a snapshot of where you are financially as a whole, considering how much debt you owe and the value of the things you own. You can think of it like a report card about your financial health.
Although net worth varies greatly depending on a person’s circumstances, Knowing the net worth of someone your same age, including their income, cost of living, family inheritance, housing situation (renter or buyer), and education is a good benchmark to help you see where you stand compared to the average.
Here’s a breakdown of both median and average net worth in America by age: Federal Reserve Survey of Consumer Finances It was released in October 2023. Note that the average figures are skewed towards the wealthiest households in the US, meaning median net worth figures are a better indication of where Americans of all ages actually stand.
Household net worth by age
|Age of the head of the family||Median net worth||Average net worth|
As we mentioned above, your net worth is calculated by adding up your total assets (like earned income) and then subtracting your liabilities (like debt).
Your assets can include anything you own that has value:
- retirement accounts
- Gift of jewelry
Your liabilities may include any debts such as:
- Credit card debt
- student loans
- vehicle loans
In simple terms, net worth looks at the difference between your debt and the assets you own. A few simple ways to increase your net worth are to grow your assets by investing in the market or to save more in a savings account that earns a high amount of interest.
It’s normal for your net worth to change over time as you borrow and repay debt, increase your assets, and grow your investments.
Over time, you can make checking this number part of your financial routine. Doing this can help you clarify your priorities; Should you borrow money right now to study further? Is it time to buy a house? Knowing your net worth can help you evaluate whether your next financial move is a good one.
Strengthen (formerly Personal Capital) and mint are two platforms that make it easy to track your net worth. With both apps, users can link all of their accounts—checking, savings, money markets, CDs, investments, retirement accounts, credit card accounts, and loans—so they have a single place to see everything.
Empower has its own net worth calculator, and Mint has a net worth-specific dashboard that shows your progress each month.
The app is free, but users have the option to add investment management services for 0.89% of their money (for accounts under $1 million).
A budgeting app and investment tool that tracks both your spending and wealth
Separate your expenses into categories
Yes, but users can make changes
Links to accounts
Yes, debit and credit cards, as well as IRAs, 401(k)s, mortgages and loans.
Available on both the App Store (for iOS) and Google Play (for Android)
Data encryption, fraud protection and strong user authentication
Your net worth, like your credit score, is an important number you should track to get a clear picture of your financial health. Keep an eye on it as you pay off debt, borrow more, or increase your money.
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