Net worth is the total value of your assets — cash, investments, retirement accounts, home, and possessions — minus your total liabilities, such as a mortgage, student loans, and credit card balances. It's the single best snapshot of your overall financial position.
The absolute number matters less than the trend. A net worth that climbs year over year shows your finances are moving the right way, whether through saving, investing, or paying down debt.
Related terms: Dividend Yield · PMI