Net Worth is everything you own minus everything you owe. For Indians, that includes EPF, PPF, NPS, property, gold, investments and cash, minus home, car, education and credit-card loans. It is a snapshot of your financial position today, not a verdict on you.
Net Worth is the total value of everything you own minus everything you owe.
Net Worth = Total Assets − Total Liabilities
If you want the basic formula and a simple walkthrough, start with How to Calculate Your NetWorth in India. This article goes further: it gives you a complete method for building a Net Worth you can trust.
Most people don't have a money problem. They have a visibility problem.
Your money sits in a salary account, an old bank account, a demat account, a few mutual fund folios, two EPF accounts from past employers, a PPF and some gold at home. No single statement shows all of it, so the number in your head is a guess, and it is usually too low.
The FOLO Net Worth Framework is a five-step method for building and using your Net Worth: See, Organise, Protect, Manage, Grow. It is a FOLO framework, not a regulatory standard.
Assets are things you own that have monetary value.
Liabilities are amounts you owe: home loan, car loan, education loan, personal loan, credit-card outstanding, loans from family, and your share of any joint loan.
For the full list of what people miss, read The Complete List of Assets People Forget to Include in Net Worth.
Organising means grouping assets by how quickly you can use them. Two people can each have ₹1 crore of Net Worth and be in very different positions. One may have it in mutual funds and deposits. The other may have it in a flat and EPF.
Group your assets into:
This grouping is the basis of Liquid Net Worth, which many people find more useful than the total.
Your Net Worth is only as strong as its weakest point. Ask three questions:
Look for what needs attention:
Your Net Worth grows through three levers:
Track it every quarter. Direction matters more than any single reading. If your Net Worth is below zero right now, read Negative Net Worth: What It Means and How to Recover.
Neha, 34, Pune (illustrative figures)
Assets: ₹133 lakh
Liabilities: ₹43.5 lakh
Net Worth = ₹133L − ₹43.5L = ₹89.5 lakh
Of Neha's ₹133L in assets, ₹85L is a home. That tells you far more than the total does, which is why Step 2 matters.
Net Worth does not show how much you earn, how much you spend, or how easily you can access your money. Read it alongside Net Worth ratios, Liquid Net Worth and cash flow.
Quarterly suits most people. Monthly helps if you're paying down debt or investing actively.
Yes, as an asset, with any home loan as a liability. Many people also track a version without the primary home, to see their investable wealth.
No. Net Worth is a measurable number. Wealth is broader and includes security, time and choice.
It can be, at current resale value, which is usually much lower than the purchase price.
Methodology note
Values are at current market value, not purchase price. Property is at a realistic resale estimate. Vested ESOPs/RSUs are at estimated post-tax value. Unvested grants are tracked separately. Examples are illustrative, not FOLO user data.
Sources
Continue the series
FOLO is India's NetWorth app. Know your number, benchmark it, and watch it grow. Free, SEBI registered.
This article is for educational purposes and is not investment advice. Investment in securities market are subject to market risks. Examples are illustrative and not FOLO user data.
