Understand your financial position by calculating assets, liabilities, and future net worth.
Net worth represents the difference between what you own (assets) and what you owe (liabilities).
Formula:
Net Worth = Total Assets − Total Liabilities
Tracking net worth over time helps measure financial progress and long-term stability.
Is a negative net worth bad?It indicates liabilities exceed assets, common early in careers.
How often should I calculate net worth?Every 6–12 months.
What is a healthy liquidity ratio?Above 1 means liquid assets can cover liabilities.
