Net worth
Everything you own minus everything you owe — the single clearest measure of financial position.
Net worth adds up assets — home, super, investments, cash, vehicles — and subtracts liabilities such as mortgages, personal loans and credit cards. The remainder is what you actually own.
It is more useful than income because it captures the cumulative result of decisions rather than a single year's earnings. A high earner with high spending can have lower net worth than a modest earner who saves.
Tracked over time, the trend matters more than the number. Consistent growth indicates the plan is working, regardless of the starting point.
Compare the figure only against your own history, never against other people. Someone with a larger balance sheet may simply be older, have inherited, or carry far more debt behind the same headline number.
A typical calculation
Home $850,000, super $180,000, shares $60,000 and cash $25,000 totals $1,115,000. Subtract a $520,000 mortgage and $15,000 of other debt for a net worth of $580,000.
The bit people get wrong
Including depreciating consumer items inflates the picture. Counting a car at its purchase price rather than resale value overstates net worth by thousands from the day you drive away.
Common questions
How often should I calculate it?
Once or twice a year is enough. More frequent checking mostly captures market noise rather than progress.
Should super be included?
Yes. It is genuinely yours even though it is preserved, and for many Australians it is the second-largest asset after the home.
What is a good net worth?
There is no universal figure. What matters is whether the trend is upward and whether the trajectory supports your own goals.