Your net worth is the single best measure of your overall financial health. It is not your salary. It is not your car. It is simple math: what you own minus what you owe.

Disclaimer: I am not a financial advisor. This information is for educational purposes only and should not be considered as financial advice. Always do your own research and consider seeking advice from a qualified financial professional before making any investment decisions.

What Is Net Worth?

Your net worth is a snapshot of your financial position at a specific moment. It answers one question: if you sold everything you own and paid off all your debts today, how much would you have left?

The formula is straightforward:

Net Worth = Total Assets − Total Liabilities

A high salary means nothing if debt is growing faster. A modest salary with consistent saving can still build wealth. The number tells you which story you are actually living.

What Counts as an Asset?

Assets are things you own that have value. Include:

• Cash: current, savings, notice, and money market balances
• Your Tax-Free Savings Account (TFSA)
• ETFs, unit trusts, and other investment accounts
• Retirement money: pension fund, provident fund, and retirement annuity balances
• Property at a realistic market value, not what you paid or what an estate agent hoped for three years ago
• Vehicles at resale value, not the price on the licence disc
• Other valuables only if they are significant and actually sellable

Be conservative. Your car is not worth what you paid for it. Check AutoTrader or similar listings. Your home is worth what a buyer would pay, not the municipal value or the original purchase price.

What Counts as a Liability?

Liabilities are what you owe. Include:

• Home loan balance (the outstanding amount, not the original bond)
• Car finance
• Credit cards and store accounts
• Personal loans and study loans
• Money owed to SARS
• Informal debt: family loans, stokvel arrears, anything you actually have to repay

Include the small stuff. Honesty matters more than a pretty number. Do not double-count: the car goes on the asset side at resale value, and the remaining finance goes on the liability side.

A Quick Example

Suppose you have R80,000 in cash and investments, a home worth R1.4 million with a R900,000 bond, a car worth R120,000 with R70,000 still owing, and R15,000 on a credit card.

Assets: R80,000 + R1,400,000 + R120,000 = R1,600,000
Liabilities: R900,000 + R70,000 + R15,000 = R985,000
Net worth: R615,000

That number will move every month. The point is not to impress anyone. It is to see whether next month’s number is better than this one. This example also leaves out retirement money — add your pension, provident fund, or RA balance too, or you will understate the picture.

Why Track It?

Tracking helps you:

• See the impact of your decisions, not just your income
• Stay motivated when the number grinds upward
• Catch problems early — rising debt, shrinking cash, a home loan that is not actually shrinking
• Measure progress toward financial independence

It also answers a more useful question than “how much do I earn?”: are you actually getting ahead?

How Often Should You Check?

Once a month is plenty. More often turns into obsession, especially when markets wiggle. Less often and you lose the plot.

Pick a date — the first of the month, payday, whatever you will remember — and stick to it.

Simple Ways to Track

Spreadsheet: one column for assets, one for liabilities, a formula for the difference. Ten minutes a month. This is still the best option if your money lives across more than one bank or broker.

Banking apps: some apps now estimate net worth by linking accounts. Fine if everything sits in one place. Incomplete if your RA, TFSA, or home loan lives elsewhere.

Pen and paper: still works. Write it down. File it. Compare month to month.

What to Watch For

The trend matters more than the number. A negative net worth is fine if it is improving each month. A positive net worth that is shrinking needs attention.

• Is the number moving in the right direction?
• Which assets are growing? Which are flat?
• Is debt decreasing, or quietly creeping up?
• Is your emergency cash rising, or are you raiding it?

Home prices and investment values bounce around. Do not celebrate a property boom as if you saved more, and do not panic because the JSE had a bad month. Watch the parts you control: saving, debt repayment, and avoiding new liabilities.

Common Mistakes

Leaving things out. Store accounts, tax debt, and the loan from a family member still count.

Overvaluing assets. Use conservative resale values. If you would not get that price in 30 days, it is not the price.

Ignoring retirement accounts. Your pension, provident fund, and RA are part of your net worth. They are future-you’s money, not “inaccessible so they don’t count”.

Comparing to others. Someone earning less may have a higher net worth because they save better. Someone earning more may be deep in debt. Focus on your own trajectory.

Final Thought

Tracking your net worth is not about judgment. It is about awareness. The number does not define you. Knowing it helps you make better decisions.

Start today. Write down what you own and what you owe. Calculate the difference. Then do it again next month. Over time the picture gets clear — and that clarity is the whole point.