How to monitor your net worth

Joe Gardiner0

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What is net worth and why is it important?

Your net worth is essentially the value of everything you own (positive) minus everything you owe (negative). Calculating your net worth is a good way of checking your financial well-being. One of the financial outcomes that you want to head toward in your personal finances is to grow your income over time, and also grow your net worth. Tracking your net worth can be used to make sure you don’t stretch your finances too thin, through excessive spending or borrowing. Importantly, your net worth can determine how much money you’ll be able to have in your retirement account.

How do I calculate net worth?

Calculating net worth is fairly straightforward, it’s calculated by taking your total assets and subtracting your total liabilities. Simple right?

It’s important to be very thorough when finding the value of your assets and liabilities and we’ll discuss all that you should include in your calculations.

What is the difference between assets and liabilities?


You can work out your assets by putting together all of the assets that you hold paying particular attention to long-term or financial assets. Focus on the big things, don’t overwhelm yourself trying to calculate the value of things like your coffee table, books or chairs.

These include things such as:

  • Superannuation accounts
  • Your own home
  • Your investment properties
  • That value of any exchange-traded funds that you may hold (ETFS)
  • That value of any cryptocurrencies that you might hold
  • Bonds and savings accounts
  • Even jewellery, art and some recreational equipment such as your cars, jetskis and anything else that could potentially be sold but you want to pay particular attention to assets such as super property savings and investments.


When it comes to your liabilities, these include things such as:

  • Home lending
  • Investment property lending
  • Credit card balances
  • Personal loan balances
  • HESC or student loans
  • Any vehicle loans or business loans that you might have

It’s important that you account for everything in this section, unlike your assets.

How can I monitor my net worth?

Over the course of your career, you’ll be able to grow your income and then use the surplus of your income to invest in assets. A good thing to do is to keep and monitoring on the assets and liabilities.

As the famous management consultant Peter Drucker once said “what gets measured gets managed” and "what's measured, improves.” Measurement is vitally important to your net worth and particularly monitoring its changing improvement over time.

A good way to do this is to keep track of it on a bi-monthly basis. This can be kept very simple, for example, I use a Google sheet that I share with my wife to help me track our personal net worth. I’ll outline below how my wife and I use this, as a guide, and we’ll provide access to your own tracking sheet below, which you can use to help you stay on top of your own personal net worth and meet your financial goals.

On a regular basis, I take a snapshot of all the accounts, assets and liabilities that we jointly hold and we collaborate to fill that out. The spreadsheet then automatically summarises this into our net worth position. We’ve been doing this since about 2013 and through regular checking, it has resulted in us being able to improve our net worth position over time. As a couple, it’s helped us be on the same page about what our overall finances look like and how it shapes up over time. It’s remarkable because it can give you a really structured way of looking at your finances over time and sharing that as a couple creates a more open conversation with your partner around the trends in our finances and what we can do to improve them and some of the changes that may have been experienced 

Within the spreadsheet, it has a column for each time that I filled it out. Generally, I fill it out somewhere between 6 to 10 times per year and so I have a record of the changes going back for a number of years now. And I have included a chart, which allows me to have a look at my financial position very easily. There are more sophisticated personal finance financial management tools or PFM titles, which I find are quite good for keeping track of billing cycles and also just month-to-month budgets. However, they don’t really help with overall net worth positions when you include things that are non-financial such as property or other items which are harder to measure. So, I find it best to do it through a manual process because it engages me more.

I can do a printout so that my wife and I can talk through it easily. This is the single most important financial process that we’ve got for planning and building our future. I would highly encourage you to do it as well.

And again, if you want a copy of your own net worth tracker sheet it’s completely free and accessible right here. Simply create a copy of this document to your own Google Drive and follow the instructions within.

All our clients get their assistance with their net worth tracking and we help them keep it updated and accurate, including with the latest valuations on their property. Doing this helps them prepare for the next financial need or event. They’ll already have a good understanding of their net worth position and balances when it comes time to refinance or buy a new property or take on a commitment such as buying a business or buying a new car.

Alternatively, there are numerous apps that help you automate the process of tracking your net worth.

What is the relationship between net worth and personal income?

Generally, the higher your income, the higher your net worth. This is not always the case, however, as financial obligations and reckless spending can land someone with a higher income below a financially responsible person with a lower income. This is why it’s so important to look for ways to improve your net worth.

How can I improve my net worth?

You may have a negative net worth from borrowing too much money. This could be from mortgages, car loans, credit cards etc. Your first step should be reducing your liabilities and paying down your debts.

Set goals

Try to get an idea of how much money you’d like to have saved for when you retire, and also consider when you’d like to retire. This can create a clear vision and purpose for your savings goals, as we mentioned earlier ‘what’s measured, improves”. You can work back from this goal to create weekly savings targets, and strategies to grow your assets and shrink your liabilities.

Pay off debts

Creating a debt payment plan is a great way to increase your net worth. The lower your liabilities, the greater your net worth will be. This could be credit card debt, student loans, car loans or mortgages. A good step to take is to know all of your debts. When you know all your debts, you can create a plan based on your income that can help you consolidate your debt faster. With high-interest loans such as car loans, you’re going to be paying less if you pay it off faster than if you stick to the payment period, so paying these off first should be your priority.

Calculate your net worth on a regular basis

Calculating your net worth on a regular basis (like I talked about in the How to monitor my net worth section), is extremely useful. You can calculate your net worth and update it regularly with a Google Sheets or Microsoft Excel template. This will make sure you’re on track to meet your financial goals, and seeing your actual net worth can be a wake-up call on how you manage your money.

Reduce your spending

To make sure you stay on top of your savings goals, you need a budget. Implementing a weekly or biweekly budget can be incredibly useful for tracking your financial progress. You can see where you’re spending money each week and where you’re spending money on wants rather than needs. Cutting back on your wants doesn’t mean going cold turkey, but restricting yourself can see a lot more money going into your bank accounts, less credit card debt and a better credit score (which could help you secure a home loan!). Smart financial decisions will allow you to meet your financial goals.

Make sure you don’t over-borrow

If you borrow too frequently or in large amounts, your net worth and financial health could be severely hindered. Your assets will be offset by any liabilities you have such as loans. You should only take out loans you know you can comfortability afford.

Invest money

Investing money, particularly as you begin to earn more, can be a great way to grow your assets and hence grow your net worth. You can invest your money in shares or crypto. Growing these investment accounts is very useful as not only do you save more money, but you’re likely to see an increase in the value of your money over time. You should contact a financial advisor and learn about what you’re investing in before you begin. If you’re in a very stable financial situation, you may even consider investing in real estate. Property prices have a general increase in value over time so this can be a great way to grow your assets. Should you choose to get into the investment property market, YouBroker is here to help with our simple get started process.

Grow your income

Growing your income could be done through various avenues but let’s start with why this is important.

Overspending is an issue that can be dealt with, but when it comes to regular bills, it’s difficult to reduce them and you will always have to pay them. Growing your income can reduce the drain that your bills, such as water and electricity, have on your savings, investments and money you have to spend on yourself or things you enjoy.

This could be through asking for a pay rise, actively seeking higher-paying jobs, or getting a second job. It can also be through starting a side hustle or your own business. This could be something like making a podcast, selling photos, whatever you have skills in and can charge for you can do. You set your own hours and your own prices. Alternatively, leasing out a bedroom, tools you own and even your car is becoming increasingly popular, through platforms such as Airbnb, Car Next Door or Open Shed.

Developing skills through digital learning platforms such as Skillshare or KhanAcademy is a great way to earn extra money. An example of a useful, monetisable skill, is coding. You can take basic courses that require no previous experience and build up knowledge that you can use to then sell as a service. You may be able to offer coding services to small businesses looking to create a website. This can bring in extra money each month, which grows your net worth.

Talk to a professional

If you're uncertain about what any of this means, how to implement it or are looking for additional ways to grow your net worth, don’t hesitate to speak to a financial advisor or a consultant. If you’re having trouble with your finances, it’s important to get on top of them as soon as you can. People can be cautious or embarrassed to discuss their finances but professional help is a great way to improve your financial health. You’ll be able to get your hands on the last information on budgeting, utilising tax breaks and more.

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