Tracking net worth every month
Calculating your net worth once is a curiosity. Calculating it every month for two years is the most powerful decision tool an ordinary person has. What changes is not the number. It is the curve.
The ritual: one fixed day a month
Pick a day, for example the first of the month or the day after payday, and record the value of everything you own and everything you owe. Fifteen minutes by hand. One minute if your accounts already sit in an app that adds them up.
What matters is consistency, not precision to the cent. A net worth of €43,200 recorded on the 1st and one of €44,100 recorded on the 3rd of the following month still draw the same trend.
Keep the snapshot. A net worth without history is just a big balance. The monthly snapshot is what lets you see whether you are heading where you meant to.
What to include and what to leave out
On the side you own: current and savings accounts, cash, funds, stocks, ETFs, crypto, pension plans at their surrender value, your home at a prudent value, and your car at what you would get today, not what it cost.
On the side you owe: outstanding mortgage, loans, deferred card balances and, if you are self-employed, the VAT and income tax you have collected but not yet paid.
What is best left out: furniture, electronics and personal belongings. Technically they are net worth, but their resale value is so low and uncertain that they only add noise to the curve.
- Home: use the area's average price minus 10%, not the most optimistic listing on the portal.
- Crypto and stocks: market value on the day, even if it hurts.
- Pending tax debt: always subtract it. It is the item that inflates self-employed net worth the most.
The time of the price matters
A net worth figure is the sum of values that change at different speeds. Your current account does not move. The stock market changes every minute of the session. Crypto never closes.
That is why each value should carry the time it was priced. Fider calls it pricedAt. If crypto is valued at 9:00 and equities at 17:30, the sum is a mix, and it is worth knowing that before making a decision with it.
It also helps catch stale data. A fund that shows the same valuation three months in a row is not stable: it is not being updated.
When to look at the curve and not the number
Today's number answers one question: how much do I have. The curve answers the one that matters: where am I going and how fast.
A net worth of €60,000 growing €800 a month is a very different situation from one of €60,000 that has been flat for a year. The first reaches €100,000 in four years. The second never does.
The curve also absorbs noise. A bad month in the market can take off €2,000 and make it look like you are going backwards. On a 24-month curve that dip is a notch, not a trend.
Crypto: how to stop it fooling you
If part of your net worth is in crypto, the monthly number can swing 20% without you having done anything. That is neither progress nor setback. It is volatility.
Two tricks help. The first is to also look at net worth excluding crypto, to see whether the rest is growing. The second is to record how much you contributed each month, separately from how much it is worth. If you contributed €500 and net worth rose €300, the market took €200 off you. If it rose €900, it added €400. Separating contribution from return is what lets you judge your decisions rather than the market's.
Frequently asked questions
How often should I recalculate it?
Once a month is enough to decide. Daily only if the app does it on its own and watching the swings does not make you anxious.
Do I combine my net worth with my partner's?
It depends on how you run the accounts. The usual approach is to track your own and, if you share a home or mortgage, record only your share.
What if my net worth is negative?
It is common at the start, especially with a mortgage or student loan. The curve is just as useful: what matters is that it rises, even if it starts below zero.