How We Track Our Net Worth

There are a lot of tools out there to help you track your finances.

Most arrived after I started working (I never got into Quicken) and after I started tracking our net worth, so they are useful but they aren’t my “core system.”

For that, we use an old fashioned spreadsheet. šŸ™‚

Our Net Worth Record is the first document in our family’s personal finance “binder” (the second is a word document I call a money field manual).

Table of Contents
  1. Why We Track Our Net Worth
  2. What Goes Into Our Net Worth
  3. What Doesn’t Go Into Our Net Worth
  4. Final Thoughts

Why We Track Our Net Worth

There are two reasons – to track our progress and to enforce a monthly check on our finances. It helps keep me sane when the world seems crazy.

(as an aside, it seems that on a daily basis I read horror stories on Reddit’s r/personalfinance forum where someone learns that for the last X years, his or her investments have sat in cash or some equivalent because they weren’t checking in on them – check in!)

Our Net Worth Record, as the Excel file is titled, is our financial dashboard. In seconds, I see a snapshot of our financial situation from the amount of cash we have on hand to the performance of investments the last month.

More importantly, I can leave notes each month to put it all in context when I read it later.

It dates back to June 2003. That was my first month of full-time work, when I had a net worth of $8,745.69 ($4,519.44 of which was in a Roth IRA I started in college). Northrop Grumman just deposited my first paycheck and my signing bonus, which accounts for the other four grand. Without notes, I wouldn’t have remembered something from over 12 years ago. šŸ™‚

It’s fun to watch the progression over the years (I’m a self-admitted numbers geek) and that’s one major reason for the document.

Since I update it monthly, I must log into our financial accounts to collect the numbers. When I log into each account, I review the transactions for the last month. Anything suspect is immediately obvious because I check in each month. I’m not seeing a 90-day old transaction and wondering what it was for, everything is within the last thirty days.

I use Personal Capital to help track our net worth, it’s one of my favorite tools and a great alternative to older systems like Quicken. It collects the data for me so I don’t have to log into each account separately. This saves me a ton of time each month while still letting me analyze all transactions. I don’t miss logging into each account and I love all the analysis tools it gives me to know if I’m saving enough for retirement. Best of all, it’s free.

Finally, it’s important to have a list of all of your financial accounts. This record is that list for us.

What Goes Into Our Net Worth

Here's a template built off our Net Worth Record. [Google Docs]
Here’s a template built off our Net Worth Record. [Google Docs]

Click to download a copy
(I won’t make you join our newsletter to get it but you can if you want more awesomeness like this!)

Every number gets included, from the value of our home and cars to bank statements.

Why do I include home value? Including home value is a big debate in some circles but it goes back to why I’m tracking our net worth – it’s to give us a snapshot of our situation. I set the value of our home at the purchase price and I include our mortgage as a liability. I opted to set it at purchase price for simplicity, but here are a few other ways to value it.

If you were to include one and not the other, it would mess up your numbers. Include a liability with the asset you purchased and the numbers look lower than they should. Include home value but not the liability and the numbers look bigger than they should.

The same goes for cars and other non-income producing assets, which people often exclude from their net worth.

We don’t update the value of the home. Unlike stock market investments, which you can sell “immediately” for the market price and a small commission, our home is the reverse. You can’t sell it in an instant for a small commission, it takes about a month and a few percent and the price depends a lot on local factors.

Given all those variables, re-evaluating your home’s value, up or down, doesn’t help and is a waste of time — so I don’t do it.

We do update the value of our cars. Since it’s constantly going down and the market is somewhat more liquid for vehicles, we include the slow decline in the value of our cars. I only include a car if it was purchased within the time limits of the Net Worth Record because of continuity… and this actually means we only do it for one of our cars.

For the car’s value, I just use the Kelley Blue Book Trade-In value for our car at the start of the year for the entire year. I don’t check it each month, there’s really no point to that level of specificity. Ain’t nobody got time for that.

What Doesn’t Go Into Our Net Worth

Credit card balances do not get included. Since the credit cards are paid off in full each month, the balances are reflected in our bank accounts with each payment. I don’t mind the one month lag.

I still log in to look for fraudulent transactions (and I get transaction notifications) but I don’t record balances.

This means that our net worth is slightly inflated because our credit card balances, which should be a liability, are never and never included.

I don’t record “petty cash,” or cash that we have in our wallets. It’s generally going to be small and not impactful, so I don’t bother to go to that level of detail.

Final Thoughts

There’s no single right way to calculate your net worth, just your way. Just a way that gives you the information you need.

When you weigh yourself, do you take off all your clothes? Do you wear the same thing each time? Do you disrobe at the doctor’s office when they weigh you? Jeans are heavy. Your clothes weigh a few pounds and increase the end number… but do they make a difference?

It’s the same with net worth.

You can track different versions for different purposes. For example, we track our liquid net worth, which is my estimate of our net worth if we converted (“liquidated”) to cash and cash equivalents.

Do you track your net worth? If so, how? What do you include or exclude, and why?

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About Jim Wang

Jim Wang is a thirty-something father of four who is a frequent contributor to Forbes and Vanguard's Blog. He has also been fortunate to have appeared in the New York Times, Baltimore Sun, Entrepreneur, and Marketplace Money.

Jim has a B.S. in Computer Science and Economics from Carnegie Mellon University, an M.S. in Information Technology - Software Engineering from Carnegie Mellon University, as well as a Masters in Business Administration from Johns Hopkins University. His approach to personal finance is that of an engineer, breaking down complex subjects into bite-sized easily understood concepts that you can use in your daily life.

One of his favorite tools (here's my treasure chest of tools,, everything I use) is Personal Capital, which enables him to manage his finances in just 15-minutes each month. They also offer financial planning, such as a Retirement Planning Tool that can tell you if you're on track to retire when you want. It's free.

He is also diversifying his investment portfolio by adding a little bit of real estate. But not rental homes, because he doesn't want a second job, it's diversified small investments in a few commercial properties and farms in Illinois, Louisiana, and California through AcreTrader.

Recently, he's invested in a few pieces of art on Masterworks too.

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  1. Manoj says

    Hi Jim,
    Why don’t you use Mint OR Personal Capital to track networth?
    I use both and also have a spreadsheet.
    -MM

    • Jim Wang says

      I use Personal Capital to collect a lot of the data, I still use a spreadsheet because I’ve had it for so long and I like the continuity.

  2. Pat says

    Many great ideas. I wish there was a place to download templates for some of these. Iā€™d pay for them. Even if I could just look at some of them, I could create them myself.

  3. Mark says

    Thanks for sharing your approach. I am older than you and have done an annual net worth calculation via spreadsheet.

    One idea I would share that I found helpful was a projection of net worth growth. It included non-retirement and retirement assets, 401k, options, etc. I included college cost estimates at the appropriate time to capture that. I did so for 15 years and it is amazing how accurate it tuned out to be, and kept me focused.

  4. Jon says

    Jim,

    Some of the formulas are either broken or missing on the Summary and a annual summary worksheets. Not sure if that was intentional.

    what do you mean by the triangles used. ie colunm C and D on the Annual Summary worksheet.

    Thanks.

    • Jim Wang says

      Yeah, it’s not really intentional but the equations don’t really work when the data isn’t fully populated (and rows/columns are missing).

      The triangles just mean “delta” – change from the previous period.

  5. Dave Henning says

    Jim,

    Another great post. I always used to do a spreadsheet almost exactly like yours. I even avoided omitted the home value because I don’t consider that my net worth (until I am ready to move full time on a sailboat of course.)

    Then, I switched to Mint.com and I actually regret not keeping up with the spreadsheet. There is a good discipline to doing the spreadsheet and looking at each account directly. It forces you to remember your logins, see if there are any notifications and also see what has been happening in the last month.

    However, the real value to the spreadsheet is the instant history that you can see. I really wish I could go back and see everything from 2003 like you can. It would be a great education.

    When I did my spreadsheet, I oriented it such that each month was its own column, not its own row. Your way is better because it makes it easy to put a comment on the right so you can explain why their might be a blip (for example, a big home improvement or a big transfer of money from checking account to an investment account.)

    Thanks, as always.

    • Jim Wang says

      Thanks Dave!

      I do enjoy being able to see all the data in one spot without having to navigate menus and whatnot. I kept up with it because I know startups come and go, services change, and I didn’t want to tie my financial data with just one company. I felt like the spreadsheet was a good backup… plus you’re right, the manual entry was part of the process and part of the appeal to me. (it forced me to simplify!)

      You can always start over again… or continue the existing spreadsheet with the gap. It’ll be annoying at first but over time it’ll just be some dark period when you were tempted by Mint. šŸ™‚

  6. Michael says

    Jim,

    Very useful information. I have been doing a similar thing in about the same level of detail for just over a year now and to some extent since I was in College. I guess I prefer the analog method as like you said it forces me to check in monthly with all of my accounts and there is something about me trusting the “privacy” of things like Mint and the endless variety of options there often bog me down. I’d much rather create exactly what I want and need and nothing more.

    I do add in a few plots in the spreadsheet which allows me to easily share things with my fiancee who is not a numbers person. It also allows me to project into the future a bit with trend lines so encourages us to be more vigilant if there was a big dip or cautious if a large spike. Both are often the result of market swings but the long term trend line helps keep us in check in the good times and motivated in the bad times.

    You could do an annual update on your home value through something like Zillow in the same way you use the Kelly Blue Book for your car.

    • Jim Wang says

      I’ve debate updating the home value with Zillow (that’s what other tools do, like Personal Capital) but we plan on staying in this house for 20+ years and I don’t like the idea of imaginary gains (or losses) clouding my net worth figures. I know I’m doing something similar to the paper gains in the stock market, but being able to realize those in a few minutes through a sale makes them feel more real, even if they are similar.

  7. Anil @ trackingdollars.com says

    I have YNAB and Personal Capital for tracking my networth, but nothing beats a good old spreadsheet. I update my spreadsheet last day of every month. I have done that every month for the previous five years without missing a month. I get this weird satisfaction updating my spreadsheet every month regardless of the networth going down or up.

    • Jim Wang says

      Tools are useful for pulling the data but I also enjoy updating the cells each month, also pushes me to become closer to my money.

  8. ward139 says

    A little late to the party…but I enjoy spreadsheets and hearing about how people interpret/like to see their data. I hadn’t thought to include tax return data but will consider compiling to see what it might teach me.

    I have my spreadsheet setup to track % of networth in respective categories (Cash, Taxable, Retirement, Home Equity) as well as show mutual fund/cash allocations for Taxable/ROTH/Retirement Accounts as well as a Cash to Taxable Investment Ratio (this has been helpful to gauge investment behavior during home renovations).

    I agree with including home asset and liability (primarily because it helps me stick with a systematic overpayment I feel comfortable with — i.e. knowing where the money went).
    I similarly use the sales price paid when I got into the home despite home value appreciation.

    I wish I had been more systematic about tracking income and contributions within the spreadsheet to see what was being saved vs. what was a return/and to look at % saved/invested relative to total income.

    I have my spreadsheet setup with the individual accounts running in the rows w/ date running across the columns. With the accounts column frozen, I only need to scroll down/not across…and have percentage breakouts described above calculated below the data inputs along with a final net worth figure. I also utilize a notes row. I was hiding rows to have annual year end numbers next to each other…but pulling these to another sheet to run some graphs/% change makes a lot of sense.

    I’m enjoying your writing. Thanks for making it available.

  9. Tom says

    So LIQUID net worth is cash and quickly-turned-into-cash assets minus all liabilities? I track my liquid that way – excepting the mortage/market value -15% like I would for net worth.

  10. Dan McDOWELL says

    I know that this mail is very late, but I am proud of our Net Worth Tracker.
    I put it together using the OpenOffice platform. It tracks:
    1. Our Net Worth including all of our investment, bank and credit union accounts;
    2. Our equity in our vehicles and house;
    3. Cash value of our life insurances;
    4. Monthly recurring expenses against Monthly income (Soc.Sec. X2 & RMD); &
    5. Next year’s expected RMD.
    Yes. I am sort of a numbers nut, too.

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