Net worth vs. liquid net worth plus#

Liquid assetsĬash: Any form of cash you currently own, including physical currency as well as money in a bank account. This way, if a need were to arise, such as an unexpected medical expense, you would know what assets you could turn to help cover your bill.Īssets that are included in your liquid net worth are considered liquid assets as opposed to non-liquid assets. The idea behind knowing your liquid net worth is to assess how much money you would be able to access quickly in the short term. Cash equivalents are assets that can easily be converted to cash you can access within a few business days.

Net worth vs. liquid net worth plus#

Cash is any physical cash plus any money you have in a bank account. Liquid net worth is the total amount of cash and cash equivalents you own minus any outstanding debt. We’ll explore what makes up your liquid net worth, easy ways to calculate it, and why it matters for your financial health.Ħ Unusual Ways Lazy People Are Boosting Their Bank Account A twist to that calculation is to look at your liquid net worth, which leaves out assets you can’t sell quickly, such as your house or car.Īlthough some methods of calculating liquid net worth include valuable but tough-to-sell assets, most focus on liquid assets you can turn into cash in a hurry if you need to. Calculating your net worth is a matter of adding total assets together and subtracting your outstanding debt.