Why you should be calculating net worth for your household (even if you’re broke)

Calculating Net Worth 1

Ever since I’ve decided to get better at personal finance, I’ve been calculating net worth for myself and later for two of us. Of course, during first couple of years it was mostly negative because I borrowed too much and had a tendency to spend every dollar I’ve made.

In fact it was just sad:


My assets: $124.45 on my checking account

My liabilities: $12,400 in student loans + 9,700 on credit cards

Net worth:  - $21,975.55


(These are my actual numbers circa 2004!)

Of course, now our net worth statements look much more positive (check out our net worth update from 2014).

But I believe you should be calculating net worth even if you’re broke. You might say - heck, why should I? Net worth statements are for rich people who have money, stocks, and flying cars. Why should broke people bother with this?


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Net Worth Update - End of 2014

Calculating Net Worth 7

 Net Worth Update - 2014

Following example of many personal finance bloggers, I publish our annual net worth update every year. Given my utter laziness and nature of some of our investments, I only do it once a year and don’t see a point of doing it more often. For the most part, I only check our investment balances once a year and don’t sweat monthly changes.


The main reasons for publishing net worth update is keeping us on track and somewhat accountable for our actions. For example, I am very opposed to having consumer debt, and I’d like to show that we put our money where our mouth is by not having any.

Only major items are included in our calculations. I know some people put everything under the moon in their net worth update including value of coin collections, car values, insurance policies, and spouse’s jewelry. This sounds like way too much work (see my comment on my utter laziness), and these numbers would not be significant anyway. Value of our car almost doubles every time I fill it up with gas, and the only coin collection I have is the spare change stash for an occasional secret trip to Burger King.


Net Worth Update

Net Worth Update


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Attracting money with old superstitions

Old Russian superstition and attracting money

Personally, I’m not a superstitious person. My wife isn’t one either, but we do share couple of superstitions between us which we stick to for some reason. Perhaps we’ve inherited them from our parents. After all, kids do what parents do without questioning it.

My wife’s superstition is somewhat cool. If she ever gives somebody a wallet as a present, she always puts money into it. Some people consider giving an empty wallet a sign of bad luck - if you give an empty wallet, it will stay empty. At the same time, if you put some money into it and hold on to it, this money will be attracting money for you and making you wealthier as the time passes. So, she always puts $5 or $10 dollars inside a wallet before gifting it.

I’ve received two wallets from her as a gift over the years, and both contained money. For the last 4 years since she gave my current wallet as a gift, I’ve been walking around with a $20 bill tucked away inside of it.  She laughed a little when explaining it to me the first time, and said it’s all stupid, but her mom has always been doing it, so she does the same thing now. Monkey see, monkey do!


Attracting Money

Attracting Money

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