Ask someone what they earn and they'll tell you to the pound. Ask what they're worth and most people go quiet.
It's a common pattern. Even friends who have a good handle on money tend to miss whole categories when they sit down and add it up. Net worth is a single number: everything you own, minus everything you owe. It tells you where you are right now, and it hints at what those assets could support for you later on. It isn't a number to show off about. It's a starting point.
One caveat before we start: this is my version of net worth. There are no universal rules here, and other people will draw some of the lines in different places.
In its simplest form, net worth is your assets added up, minus your liabilities: the things you owe. The arithmetic was never the problem. Deciding what goes on the list is.
The most debated item is your primary home: should it be in the calculation or out of it? There are two reasonable positions, and which one fits depends on your situation.
Home in. For most people it's the single biggest thing they own, and it does create options: downsizing to free up equity, a lifetime mortgage (equity release), or moving somewhere with a lower cost of living. Those routes don't suit everyone, and plenty of people would never take them, but it helps to know they exist. They matter most in specific cases: starting to build wealth late, or having no plan to pass the house on.
Home out. You have to live somewhere, so the equity in your home isn't money you can really spend. For some people it's a forever home, or one they intend to pass down, and trading it was never on the table. If you take this approach, keep the mortgage in your liabilities anyway. The debt is real and has to be paid whether or not you count the asset it's attached to.
I track it both ways. One figure with the home in, one without. The version without your home is the more honest one for retirement planning, because it shows what you'd have to live on if the house stays off the table.
Assets fall into a few groups. There are physical ones like property and collectables, and financial ones like cash, funds, and crypto. Go through each group rather than working from memory: past three or four items, a mental tally starts dropping things.
Then the other side of the ledger. Work through your liabilities with the same care.
Partial list. The most common error isn't the maths, it's an incomplete list. People total up their current accounts and their main investment platform, then stop. What gets missed: a pension from two jobs ago, a flat in another country, an inheritance sitting in a separate account because it feels separate from "their" money.
Inheritance. Inherited assets catch people out most, because they're often large enough to change the whole picture. I've seen someone leave a six-figure inheritance off the list entirely. Added back in, it changed what they could actually do: retire earlier, or move to work that paid less but suited them better.
Assets abroad. This comes up a lot with expats. There's often a property back home and a real chance of moving back to it one day. It still counts: it's an asset you could sell or borrow against like any other. Convert anything held in another currency to pounds at today's rate so the whole total is in one currency.
Tracking fatigue. This one is almost universal. People start well, then after a few rounds the updates slip and the whole thing goes stale.
Two things, mostly.
The first is that you might be closer to your goals than you think. Plenty of people could step back from work sooner than they realise and have no idea, because they've never added everything up at once. The number can give you permission to stop over-saving for a problem you've already solved.
The second is that it breaks the assumption that a big income means wealth. Large house, large mortgage, a leased car on the drive, a strong salary, and a net worth close to zero. That combination is everywhere, and the total is the only thing that shows it plainly.
Money buys options. Knowing where you stand is what turns that into a plan.
Copy this into a document and fill in what applies to you.
Assets
Liabilities
Run two totals, one with your home in and one without, and put a date in the calendar to do it again next quarter. Once a quarter is plenty when you're doing this by hand.
Knowing where you're starting from makes everything after it easier. You can't plan a route without a starting point, and this is the starting point.
If you want to see where you stand against everyone else, the ONS Wealth and Assets Survey breaks down household wealth in Great Britain by age, region and how it's held. It's a useful reference point, but your own number moving in the right direction over time matters more than where you land against an average.
Gild pulls all of this into one place: bank and savings accounts over Open Banking, pensions and investments next to them, and property and other assets added by hand. You get both versions of the number, home in and home out, without logging into six providers and adding it up yourself every quarter.
Everything in one place: your banks, pensions, investments, and goals.
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