Martin Barraud | Getty Images
Knowing your net worth isn’t just for the 1%.
Even if you don’t fly in first class or summer in the Hamptons, this simple equation is an important tool that says a lot about your financial health.
Still, most people don’t bother to calculate it. That’s a mistake.
“It’s the first snapshot into an overall look at your finances,” said Michael LaRiviere, a certified financial planner at Essex Financial in Connecticut.
Subtract what you owe from what you own to determine your net worth.
Your net worth is essentially the sum of all of your assets, including cash, retirement accounts, college savings, house, cars, investment properties and valuables such as art and jewelry minus any liabilities, or long-term debt, such as a mortgage, student loans, revolving credit card balances and any other personal loans.
“More often than not — especially for those under 40 — the number is going to be negative,” said Daniel Routh, a CFP at Old Peak Finance. “That’s not…