Net Worth

Net worth is a snapshot of your financial position. You add up everything you own (your assets) and subtract everything you owe (your debts). The number you’re left with is your net worth.

How to calculate it

Assets include things like the balance in your TFSA, RRSP, and non-registered accounts, cash in savings accounts, the value of your home if you own one, and anything else of significant value. Debts include your mortgage balance, student loans, credit card balances, and car loans.

If your assets total $250,000 and your debts total $180,000, your net worth is $70,000.

Why it matters

Net worth gives you a single number that represents your overall financial health. It’s more useful than looking at any one account balance in isolation, because it accounts for both sides of the picture. You could have $100,000 in investments but also carry $120,000 in debt, putting you in a negative net worth position.

Tracking it over time

The real value of net worth isn’t any single calculation. It’s watching the trend. Seeing your net worth move in the right direction over months and years is one of the clearest signs that your financial plan is working. Most people find that tracking it regularly, even just once a month, keeps them motivated and aware of where they stand.