all right if you are looking to calculate your net worth and track your
net worth you were in for a treat because in this video I'm gonna show you
a little-known tool that I've been using the last couple years to calculate and
track my net worth and it's really been awesome because it gives me a really
great kind of overview snapshot of my financial health and everything that's
going on and so if you're looking to take control of your finances and really
want to improve your financial situation tracking your net worth is one of the
best things that you can do and in this video we're going to talk about a couple
of different ways you can do this but there's one tool in particular I
absolutely love it's fantastic and on top of all that it is 100% free so if
if you're looking for some great ways to track your net worth hang tight we're just about to start
and if you're new here my name is Bob Lotich welcome to our
channel and what we do here is we talk about all kinds of ways to put more
money in your pocket practical stuff but then we also talk about some of the
timeless biblical principles on how to manage our money wisely so if that's
something that resonates with you you can definitely hit that subscribe button
so you can hear from us as you create new content along these lines now as
we're going through the video any links that I mentioned I'll have them linked
up down below so you can check them out and also be sure to take advantage of
the comment section down below any questions you might have or anything
comes up leave them down in the comment section and I will get back to you as
soon as I can okay and I think that's about all the
housekeeping for today so let's get started all right so let's start with
how to actually calculate your net worth lucky for us all this is about as simple
of a math problem as it can be so all you need to do to actually calculate
your net worth is to take your assets minus your liabilities and that is your
net worth so your assets being everything that you own that has some
sort of value so any money in your checking account and your savings
account the equity in your house how much your cars would be worth really
anything that you could sell that has any sort of value that would fall into
the assets category and then over on the liability side this is any debts the owe
so this would be credit cards this would be student loans this would be your
mortgage car loans anything along those lines and so the simplest way to do this
is really just take out a sheet of paper and you can just write down all your
assets on one side total them up write down all your liabilities on the other
side total that up and then subtract those two and
that gives you your net worth now while doing this on a sheet of paper can be
incredibly simple it actually can be kind of time-consuming especially if you
want to update this somewhat regularly and that's one of the things I'm so
excited about with this free net worth tracking tool that I've been using the
last few years that I can go in one time and kind of put all this information in
and then it will continuously monitor and track my net worth going forward
all right so why should we track our net worth in the first place and I think
what it comes down to is this idea that if you want to improve something you
need to measure it you need to know where you are and whether you're making
progress Peter Drucker has this great quote where
he says whatever gets measured gets managed and scary truth is is that if
we're not actually measuring what's going on in our finances we don't know
if we're going forwards or backwards at all and so the bottom line is if you're
really serious about your finances and improving your financial picture you
need to be tracking your net worth now I have been tracking my net worth for the
last 14 years and the first time I did this my net worth was negative $13,000
so I was well below zero and which you might be in a similar situation it's not
that uncommon to have a negative net worth but regardless of where you are
let's view this as a starting point let's view this as a baseline from which
we can continue to move forward and what's great about your net worth is
that any good financial decision that you make adds to that equation so if
you're paying off debt that adds to your net worth if you're increasing your
investments that adds to your net worth and for more on this check out this
other video I did about the seesaw principle and how you can use this one
principle to your advantage to really help you build wealth all right so now I
want to take you over to the computer so I can show you this free net worth
tracking tool that I've been using for years and then I really love so you can
see how it works and how I use it and you can decide if it's something you
want to try out alright so what we are looking at here is my Personal Capital
dashboard and Personal Capital is the tool that I love to use because they
have a built in net worth tracker which is just fantastic and essentially what
personal capital is is a modern version of Quicken and I don't know if you ever
used Quicken in the past but I used it for years and was always so frustrated
with that software and it drove me crazy and I felt like you spent
so much time well anyway personal capital I feel like it's finally
personal finance software done right it's easy to use it's easy to understand
it's quick it doesn't take much time it's very intuitive and on top of all
that it's free so just like Quicken or any other personal finance software you
need to connect your accounts and once you have your accounts connected it will
automatically adjust your net worth every time that you log in and so in our
case here we just have a handful of accounts linked up and this is just kind
of a sample account but if we click on the net worth tab we can see our net
worth and we can see how it adjusts over time which is just really really fun
because like I mentioned before every good financial decision that you make
contributes to this and so you can watch your net worth grow and improve as you
continue to make good financial decisions so now to get an accurate view
of your actual net worth you do need to link up all your different accounts and
there'll be a couple other things you will want to do so like you can come
over here link account and so you can add your home value and so you can go
get this information from Zillow you know you can go to KBB.com to get like
your car value and how much your car is actually worth so you can add that into
the equation as well and you'll want to add all those things in to actually get
a accurate picture of what your net worth is but the great thing about this
that I love so much more than a spreadsheet or doing this on paper is
this is a one-time thing so for all these different accounts that you're
linking it's gonna automatically update for you every time you log in and you
won't have to add them back in you know for years I used a spreadsheet to
calculate my net worth and every single time I wanted to get that up-to-date
number I had to go back through and check all my accounts and check all my
investments and and just manually do all this to get it added up and that's why I
love Personal Capital for Network trackers because it does it for you
continuously and you just get to do the work one time so like I said start an
account Personal Capital is completely free it's really simple to open an
account it's a quick signup process and so with all the great features that they
have built in it still kind of blows my mind that they they offer this software
for free because Quicken still charge is to use their software and in my
opinion it's not nearly as good and so you're probably wondering just like I
was when I first signed up like how do they provide this great software for
free like how do they make money and the answer is this wealth management area
and basically they have a really smart business model where they created this
fantastic software and provided it for free and got millions and millions of
users to use it and to all these millions and millions of users they
offer their wealth management services and so if you happen to need help
managing your investments they are right there ready to help if you need help
with it and I love that they've made this tool available to us all for free
regardless of whether we're using their wealth management services and I've
never used their services myself and honestly I don't plan to
but clearly the business model is working for them because they've been
doing this for years and you know and only continue to improve the software
and so once you have your free account set up you can just come over here to
make sure that you link up all your different accounts that you have and you
can also add in all the other items like we were talking about before so if you
have off some art that might be worth something or some jewelry or you know
your home value your car value anything else you can add in all these things
that might need to be added in manually so you can get a true picture of your
actual net worth and I am someone who really values security and privacy and
so I did a good amount of research into this whole thing with them I wanted to
find out how secure it is and make sure that they're really locking things down
and it turns out that they're actually probably more secure than your bank and
the reason being is first off the data is only read-only so they can't actually
make any changes to anything additionally they use two-factor
authentication which not all banks use surprisingly and then on top of that
they use 256 bit encryption and from what I understand to try to hack into
that would take like over a billion years of computer power to do that so
all that said they have done a phenomenal job making this site
incredibly secure to protect our information and that makes me feel
really good and like I mentioned personal capital actually has a bunch of
other really cool features and tools built in and I won't go into them in
this video we'll probably make a separate video kind of talking about
some of that but if you're serious about tracking your finances and if you've
ever been annoyed by Quicken or some of the other personal finance software out
there that has you know been less than stellar at least in my opinion I think
it's worth checking out Personal Capital
all right well I hope you found that
helpful and if you did I'd love it if you could leave us a thumbs up that
would be a major blessing and one last thing before we wrap up I just want to
make this super clear that your Worth and value as a human being is not tied
to the number that you get when you calculate your net worth and your smart
person I know you know this but I just want to remind you that you are created
in God's image for a purpose and for a reason and no matter where you are on
the spectrum if you're negative ten thousand dollars or negative a hundred
thousand dollars or ten million dollars it just doesn't matter because at the
end of the day it's just a number that we're using to track our financial
progress and whether it's high or low doesn't make you worse or better than anyone else
so anyway like I said before I hope you enjoyed this video that's all
we have for today so have a great rest your day and I will see you in the next video