I Started Tracking My Net Worth at 21. The First Number Was Uncomfortable. That Was the Point.

Most people who are bad with money are not irresponsible. They are unaware. They have a rough sense of what comes in every month and an approximate feeling about what goes out, but they have never sat down and looked at the actual number — the single figure that tells you what you are worth today if you subtracted everything you owe from everything you own.

I avoided this for the first two years after I started earning. I told myself I knew the rough number. I did not. When I finally sat down and calculated it properly, the actual figure was about 40 percent lower than what I had in my head. I had been mentally counting money I did not really have — money that existed as a feeling of security rather than as an asset. That gap between the imagined number and the real number is where a lot of bad financial decisions quietly live.

I have tracked my net worth every month since I was 21. It took two hours to set up. It takes 20 minutes to update. What it has done to my relationship with money cannot be replicated by a budgeting app or a savings target — because it makes the cumulative picture visible in a way that day-to-day transaction tracking does not.

What Net Worth Actually Means — and What Not to Count

Net worth is a simple equation. Total assets minus total liabilities. What you own minus what you owe. The result is your financial position at a specific point in time.

The confusion comes from what counts and what does not. Most people overcount their assets and undercount their liabilities, producing a number that feels good but is not useful for making decisions.

Count as assets: Savings account balance, fixed deposits, PPF balance, EPF balance (your contribution plus employer contribution plus accumulated interest), mutual fund and equity portfolio at current market value, liquid funds, gold at today's market price not the purchase price, and real estate at a realistic resale value — not the builder's original price and not an emotional number.

Do not count as assets: Your smartphone. Your car. Your laptop. Your furniture. These are depreciating items. They lose value from the day you buy them and would fetch significantly less than their purchase price if sold today. Including them inflates your net worth number in a way that creates false comfort. A car bought for ₹8 lakh two years ago might be worth ₹5.5 lakh today. Count ₹5.5 lakh if you want to include it — not ₹8 lakh.

Count all liabilities honestly: Outstanding home loan principal remaining (not the original loan amount — the remaining balance), vehicle loan outstanding, personal loan balance, education loan remaining, credit card balance that will not be fully paid off this month, and family borrowings if there is a genuine expectation of repayment.

The most common mistake is counting the full value of a property while ignoring the loan that paid for it. If you bought a flat worth ₹60 lakh with a ₹45 lakh loan and have paid down ₹5 lakh of principal, your equity in the property is ₹20 lakh — not ₹60 lakh. Count ₹20 lakh.

The Sheet — What Is Actually In Mine

I use Google Sheets. No premium subscription, no elaborate setup. The structure is straightforward enough that I built it in one afternoon and have not changed the fundamental design since.

• Section 1 — Assets. A list of every asset category with a column for last month's value, this month's value, and the difference. Categories: savings accounts combined, mutual funds at current NAV, PPF, EPF, gold, fixed deposits, any other. New rows get added when new asset categories appear. The difference column is automatic.

• Section 2 — Liabilities. Same structure. Outstanding principal on any loans, credit card balance that will carry forward, any other obligation. The reduction in each liability month over month shows how fast debt is being paid down.

• Section 3 — Net Worth. One number. Total assets minus total liabilities. Below it is a running table — month, net worth, change from previous month, percentage change. Twelve rows of this table tell you more about your actual financial trajectory than any financial advice column could.

• Section 4 — Savings Rate. Monthly income minus monthly total spending divided by income. A single percentage. This number predicts future net worth better than any other variable because it controls how much goes in. A person saving 30 percent of income at 25 does not just have more money than one saving 10 percent — they have a fundamentally different financial future, driven more by the rate than by the returns.

What the Numbers Showed Me That I Would Not Have Seen Otherwise

Three months into tracking, I noticed that my mutual fund portfolio was growing but my net worth was essentially flat. The investments were working. The problem was that I was running a small credit card balance month to month that was quietly cancelling out every market gain. I had not connected those two things before — they lived in separate mental buckets. Once they were in the same sheet, the connection was obvious. I cleared the card in two months. The net worth number started moving.

Six months in, I noticed that in months with travel or weddings or social obligations, the net worth dipped — not because I had touched savings, but because I had paused the SIP. The pause felt harmless in the moment. On the sheet, it showed up as a visible flat line in the month-on-month progress. Seeing it as a visible dent changed the decision from "I'll restart next month" to "I'll reduce the SIP amount this month but keep it running."

The third thing — the one I did not expect — is that tracking makes progress visible during the long stretches where nothing feels like it is happening. Early in your 20s, the numbers are small and the movement is slow. Having a record showing that your net worth went from ₹35,000 to ₹1.1 lakh in eight months — even though ₹1.1 lakh still does not feel like much — is different from just "trusting the process." It happened. The proof is in the sheet. It will keep happening.

The Monthly Ritual — 20 Minutes on the First of Every Month

I update the sheet on the first of every month. Same day, same sequence, no exceptions.

First, I pull current values from each account. INDmoney aggregates most of mine in one place, which takes about five minutes to check. Mutual fund values come from Groww. EPF balance I check quarterly rather than monthly since it updates with a lag anyway.

Then I enter the numbers. The formulas calculate everything else — net worth, change, savings rate.

Then I look at the net worth number and ask one question: what drove the biggest change this month? Sometimes it is a salary credit hitting on an unusual date. Sometimes it is market movement in the equity portfolio. Sometimes it is a large expense. The answer tells me where to pay attention next month.

I do not use this session to feel bad about months where the number dropped. If it dropped because of a genuine large expense — a medical bill, a necessary purchase — that is information, not failure. If it dropped because I was not paying attention to spending, that is different information. The distinction matters. Both are useful. Neither requires self-criticism — just adjustment.

The Benchmarks Worth Knowing

There is no universal right answer for what your net worth should be at a given age. Incomes vary enormously, cities vary, family situations vary. But a commonly referenced benchmark from retirement adequacy research suggests having one year of gross salary saved by age 30. For someone earning ₹12 lakh per year, that means a net worth of approximately ₹12 lakh by 30 — roughly ₹1 lakh per month of gross income saved by the end of the decade.

That is the conservative benchmark, not the aspirational ceiling. If you are in your mid-20s starting this for the first time, you are not behind — you are starting significantly earlier than most people ever do.

The more useful benchmark is the savings rate. If you are consistently moving 20 percent or more of take-home income into savings and investments, the net worth number takes care of itself over time. The rate is the input you control. The net worth is the output that follows.

Why This Habit Matters More Than Any Individual Financial Decision

People spend significant mental energy searching for the right fund, the right platform, the right investment — as if one perfect choice will solve the financial picture. Those decisions matter at the margin. The habit of actually knowing your financial position — updated, honest, reviewed regularly — matters more than almost any individual call you will make.

It changes how you relate to money emotionally. Most people carry a background financial anxiety without a clear source — a vague unease that sits there without a name. Knowing the number does not remove anxiety, but it converts it from formless dread into a specific situation with a direction. A specific situation you can work on. Formless dread is just something you carry.

Start with a blank sheet this weekend. List every asset you can think of. List every liability you would rather not think about. Subtract. Write down the number. Whatever it is — that is your starting point. The only question from here is which direction you want it to move.

Three Things to Do This Weekend

• First — open a Google Sheet and build the four sections described above. Do not make it perfect. Start with what you know. Fill gaps as you find old statements and forgotten login credentials over the next few weeks.

• Second — set a recurring calendar reminder on the first of every month. Title it something boring so you actually click it. Block 30 minutes the first time, 20 minutes once you have done it a few times. Treat it with the same non-negotiable energy as a bill payment.

• Third — calculate your savings rate for last month. Actual income minus actual total spending divided by income. Write that percentage next to the net worth number. These two figures are the only financial metrics that actually matter to track monthly. Everything else is interesting but these two are the signal.

MMM is not a SEBI-registered investment advisor. This article describes a personal financial tracking approach and is for educational and informational purposes only. Individual financial situations vary significantly. Consult a qualified financial planner before making investment or financial decisions.

Related Stories