What Should Be Your Ideal Net Worth to Considered Wealthy | Net Worth Calculation
Net worth is one way to measure your financial health and stability, in relation to how much debt you have versus what you’ve accumulated in assets. Similar to credit scores, the higher your net worth number is the better. Especially if you’re trying to build wealth and create lasting financial security. Calculating your net worth can give you an idea of how well you’re doing financially at any given time. It can be a useful motivator to continue pursuing your financial goals. But, how much should you be net worth? This article delight comes up with a Net Worth Calculation to ideally know What Should Be Your Ideal Net Worth to Considered Wealthy !
What Is Net Worth ?
Net worth is the value of the assets a person or corporation owns, minus the liabilities they owe. Put another way, net worth is what is owned minus what is owed. Everyone owns a few assets and you may have a few debts or liabilities as well. Calculating your net worth shows you how much you’re worth in terms of dollars and cents. Net worth has also become a fixation of popular culture, with lists ranking the people with the highest net worth as well as the net worth of various celebrities. You can calculate their net worth by adding up all your assets while subtracting their outstanding liabilities from the total. Regardless of where you are in life, you may be curious to learn how much you’re worth, at least on paper.
What Should Be Your Ideal Net Worth to Considered Wealthy | Net Worth Calculation
Every person has a unique lifestyle and individual expectations, so there is no one-size-fits-all, universally agreed-upon number. That said, Thomas Stanley and William Danko, authors of “The Millionaire Next Door” have offered this formula as rule of thumb.
According to this rule, your net worth should be at any given age is to divide your age by 10, then multiple that by your gross annual income.
So if you’re 30 and make INR 20 lakh a year, you should have a net worth equal to INR 60 lakh, assuming you have no inheritance. If you want to secure your position as wealthy, your net worth should be double that number.
To calculate your present net worth in a more systematic way, you may refer to calculator https://www.nerdwallet.com/article/finance/net-worth-calculator
Final Takeaway
Net worth is subjective so what you consider a good net worth might not be the same as what someone else views as a good net worth. However using the calculation mentioned above for What Should Be Your Ideal Net Worth to Considered Wealthy gives you a big-picture way to measure your overall financial health. You can think of it like a snapshot that shows you where you are on your financial journey.
Read also : 100 Minus Age Investment Rule | How Much To Invest In Equity ( https://thebrightdelights.com/100-minus-age-investment-rule-how-much-to-invest-in-equity/ )