Net worth is the single best measure of your financial health. It equals everything you own (assets) minus everything you owe (liabilities).
Assets Include
- Cash and savings
- Investments (401k, IRA, brokerage)
- Real estate (market value)
- Vehicles and personal property
Liabilities Include
- Mortgage balance
- Student loans
- Credit card debt
- Auto loans
A negative net worth is common for young adults with student loans or new mortgages. The goal is to grow your net worth over time by increasing assets and reducing debt.