Have you ever wondered how some people always know what their net worth is? Some people track it manually, but a lot of people use a simple and free app. This app is called Personal Capital and it will instantly track your net worth.
Why is it important to track your net worth?
Your net worth is snapshot of your financial health. When you calculate this often, you’ll become more motivated to build wealth. Additionally, you’ll see financial trends that you’ll be able to learn from.
When you set up your account with Personal Capital, you may find out that you have a negative net worth. If you do, don’t sweat it.
A lot of people have a negative net worth. However, you don’t want to stay in the negative if you want to reach financial independence.
How do you figure out your net worth?
Finding your net worth is pretty simple. Your net worth is calculated by adding up all the property you own that can be sold for cash (assets,) then subtracting your debt (liabilities.)
The math looks like this: assets – liabilities = net worth.
Assets include cash, real estate, retirement accounts, investments (like gold,) and other personal property you can sell for cash.
Most people also include vehicles in this category. However, we personally believe that vehicles are liabilities and we do not include them when calculating our own personal net worth.
Some examples of liabilities include loans, medical bills, and credit card debt.
We believe in the motto:
“Assets put money into your pocket while liabilities take money out of your pocket.”Robert Kiyosaki
Ultimately, it’s up to you to determine what items are assets and which are liabilities.
How to instantly track your net worth:
Without a doubt, the free Personal Capital app is the easiest way to instantly track your net worth. Personal Capital is a highly secured website that automatically calculates your net worth, cash flow, and overall portfolio.
They also offer a variety of paid services such as wealth management and advising.
Tracking your finances with Personal Capital is easy because of all the visuals and explanations built within the app.
As you can see in the following photo, the website’s simplicity is unmatched compared to other finance trackers. Everything you could possibly want in a net worth calculator is there.
With all these free valuable tools, it’s no wonder why this is one of the most recommended apps by financial experts today.
First, you’ll need to download the app. Then, you’ll just need to sync the accounts you want to include in your net worth. Once all accounts finish syncing, Personal Capital will display your net worth.
As your balances change, the app will automatically update to display your current financial position in each account. This makes it extremely easy to not only keep track of your overall net worth, but all your assets and liabilities as well.
Adding my information
When I first created an account, I entered my banking institution, our retirement accounts, and our home value (which uses Zillow.) It took about 10 minutes to set up my accounts.
I’ve used this app for about 2 years now and I love it! Watching our net worth grow is really cool.
If you are also one of those people who have a tendency to feel financially stagnate, you’ll like being able to view your progress over time. Wealth building is quite motivating.
Keeping track of your net worth is important because it is a snapshot of your financial health. Now that you know what it is, track your net worth instantly with this free app. Personal Capital is a valuable tool for not only personal finance, but provides motivation to keep accomplishing your goals!
P.S. Join The Financial Independence Community on Facebook!