Net worth tracking is the single habit most correlated with building wealth. Learn how to calculate it, what moves it, and how to use it as your financial scoreboard.
Income is what you earn. Net worth is what you keep. Two people earning identical income can have radically different net worths based on spending, saving, and investing habits.
Tracking net worth monthly is the single habit most correlated with building wealth. Why? Because it creates a scoreboard. People who track scores work to improve them.
Assets:
- Cash in all accounts
- Investment accounts (at current value)
- Retirement accounts
- Real estate (current market value)
- Vehicles (current value, not purchase price)
- Other significant assets
Liabilities:
- All loan balances
- Credit card balances
- Any other debts
Net Worth = Total Assets - Total Liabilities
Net worth increases when: You save money, investments grow, debt balances decrease.
Net worth decreases when: You spend more than you earn, investments fall, you take on new debt.
Milestone goals: $0 (debt-free), $10,000, $50,000, $100,000, $250,000, $500,000, $1,000,000.
Each milestone represents a qualitatively different level of financial security. $0 means you owe nothing. $100,000 means 2-3 years of most people living expenses. $1,000,000 means financial independence is achievable within 10 years.
FlowFund aggregates all assets and liabilities in one dashboard and shows your net worth trend over time. The historical chart is the most motivating financial tool you can have.
Free to start. No bank connection needed. 150+ currencies, tax estimates for 20 countries.
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