Net worth is the simplest, and at the same time most useful, formula in personal finance:
```
Net worth = Assets − Liabilities
```
Assets
Bank accounts, investments, funds, pension plans, your home, your car, cryptocurrencies... any asset or right with economic value.
Liabilities
Outstanding mortgage, personal loans, credit card debt — anything you owe to others.
Why you should track it over time
The absolute figure at any given moment matters less than the trend: tracking your net worth month by month or year by year is the most direct way to know whether your financial decisions are bringing you closer to, or further from, your goals.