WealthNet worth (definition)
Your net worth equals everything you own (assets) minus everything you owe (liabilities). It's the most reliable measure of your overall financial situation — far more telling than your salary or bank balance alone.
The calculation
Assets: cash, investments (TFSA, RRSP, non-registered), home value, vehicles, etc. Liabilities: mortgage, loans, card balances. Net worth = Assets − Liabilities. It can be negative early on (student loans) and grow over time.
Why track it
Tracking your net worth once or twice a year shows your real progress, beyond market swings. It's the key indicator of financial independence and FIRE.
Frequently asked questions
How do I calculate my net worth?
Add up all your assets (investments, home, cash), then subtract all your liabilities (mortgage, loans, cards).
Is negative net worth bad?
Not in itself, especially when young (student loans). What matters is the trend: that it rises over time.
How often should I track it?
Once or twice a year is enough to see the trend without reacting to market noise.
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