Net worth answers a single, clear question: everything you own, minus everything you owe — what's actually left when the math is done? It's the cleanest single snapshot of your financial position, more revealing than your salary, your savings balance, or any other individual number on its own.
Here's how to calculate yours. List your assets — savings, investments, the value of property you own, anything of real worth — and add them up. Then list your liabilities — outstanding home loan, car loan, credit card balance, any personal loans — and add those up separately. Subtract the second total from the first. If your assets total ₹15 lakh and your liabilities total ₹8 lakh, your net worth is ₹7 lakh.
Why this single number matters more than any of its individual ingredients: someone earning a high salary but carrying heavy debt and minimal savings can have a lower net worth than someone earning less but saving steadily for years. Income tells you what's coming in; net worth tells you what you've actually kept and built, after everything else is accounted for.
The practical habit: calculate it once, today, even roughly — don't let the unfamiliarity of the exercise stop you from starting. Then recalculate it every month or so. The first number is simply a starting point, neither good nor bad on its own; what matters from here is whether it moves in the right direction over time.