The Concept of Net Worth and How to Calculate Yours

Your net worth is the single most important number in your financial life. It tells you where you stand today, guides your goals, and measures your progress. Net worth is not about how much you earn; it’s about what you keep and how you grow it.

Calculating it is simple: Net Worth = Total Assets – Total Liabilities

Assets are everything you own that has value — cash, savings, land, cars, investments, and even your business equity. Liabilities are everything you owe — loans, credit balances, unpaid bills, or mortgages.

For instance, let’s say you own: 

• Land in Delta State valued at ₦6 million 

• Savings of ₦1.2 million 

• A car worth ₦2 million 

• Stocks valued at ₦800,000 

That’s ₦10 million in assets. 

Now, if you owe

₦1.5 million on a car loan and ₦500,000 on personal debt, your total liabilities are ₦2 million. 

Your net worth is ₦8 million

Knowing your net worth helps you make better decisions. It reveals whether you are growing wealth or accumulating debt. It helps you plan for retirement, evaluate investments, and track financial health. Even if your current net worth is negative, awareness is the first step toward improvement.

At Eanvest, we take this concept further with tools that value your assets at current market prices, showing your real position daily. When you know your net worth, you stop guessing and start managing with precision.