How to Calculate Net Worth — Formula, Examples & Benchmarks
Net worth is the single most important number in personal finance. It tells you exactly where you stand financially — and whether you're building wealth or falling behind. Here's how to calculate it correctly, with real examples.
The Net Worth Formula
Net Worth = Total Assets − Total Liabilities
Assets (What You Own)
- Cash & bank accounts
- Investment accounts
- Retirement accounts (401k, IRA)
- Home equity
- Other real estate
- Vehicles
- Business ownership
- Valuables (jewelry, art)
Liabilities (What You Owe)
- Mortgage balance
- Car loans
- Student loans
- Credit card balances
- Personal loans
- Medical debt
- Business loans
- Other debts
Step-by-Step Net Worth Examples
28-Year-Old Recent Graduate
Assets
Liabilities
Net Worth
−$11,000
Negative net worth is common for recent graduates. Student loans are the main culprit. Focus on paying high-interest debt first while building emergency savings.
38-Year-Old Homeowner
Assets
Liabilities
Net Worth
$284,000
Home equity ($100K) and retirement savings are the biggest drivers. This person is on track — the "1× salary by 40" benchmark for $284K income would be met.
55-Year-Old Pre-Retiree
Assets
Liabilities
Net Worth
$1,315,000
Strong position for retirement. The 4% rule suggests $1.3M can support ~$52,000/year in withdrawals. Combined with Social Security, this covers most retirement needs.
Net Worth Benchmarks by Age
| Age | Fidelity Benchmark | US Median (Fed Reserve) | On $75K Salary |
|---|---|---|---|
| 25–29 | — | $39,000 | Building phase |
| 30–34 | 1× salary | $91,000 | $75,000 |
| 35–39 | 2× salary | $136,000 | $150,000 |
| 40–44 | 3× salary | $436,000 | $225,000 |
| 45–49 | 4× salary | $700,000 | $300,000 |
| 50–54 | 6× salary | $833,000 | $450,000 |
| 55–59 | 7× salary | $1,175,000 | $525,000 |
| 60–64 | 8× salary | $1,400,000 | $600,000 |
Benchmarks are guidelines, not rules. Your situation depends on income, lifestyle, and goals.
Frequently Asked Questions
Should I include my car in net worth?
Yes, include your car's current market value (not what you paid). Use Kelley Blue Book or similar to estimate. Also include any remaining car loan as a liability.
Does net worth include retirement accounts?
Yes. 401(k), IRA, Roth IRA, and pension values should all be included as assets. Note that traditional retirement accounts will be taxed on withdrawal, so your actual spendable net worth is slightly lower.
What is a good net worth at 30?
Fidelity recommends having 1× your annual salary saved by 30. The US median net worth for ages 30–34 is about $91,000. However, negative net worth from student loans is common and not necessarily alarming.
How often should I calculate my net worth?
Quarterly or annually is ideal. Tracking it over time is more valuable than any single snapshot — it shows whether you're building wealth consistently.