What is Net Worth?
Net worth is your financial scorecard. It's calculated as: Net Worth = Total Assets - Total Liabilities
Net Worth Benchmarks by Age
| Age | Target Net Worth |
|---|---|
| 30 years | 1× Annual Income |
| 35 years | 2× Annual Income |
| 40 years | 4× Annual Income |
| 50 years | 8× Annual Income |
| 60 years | 12× Annual Income |
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Track Monthly
Calculate your net worth monthly or quarterly. Watching it grow is motivating and helps you identify if you're on track for your financial goals.
How to Increase Net Worth
- Pay off high-interest debt first - Credit cards, personal loans
- Increase savings rate - Target 30-50% of income
- Invest consistently - Start SIPs in equity mutual funds
- Avoid lifestyle inflation - Save raises and bonuses
- Build multiple income streams - Side business, rental income