This is a guest post from Alban. Alban is a personal finance writer. He offers budgeting tips and helps people to choose the best credit card.
Calculating your net worth is as simple as deducting your liabilities from your assets. So why would you need an online tool to calculate your net worth? Because calculating your net worth should not be a one-off sum but it should be something you do regularly so you can track your finances and know the state of your net worth, where your worth has come from and so you can see where you need and want it to go. There are a range of free online net worth calculators, programs and plug-ins to choose from to help you calculate and monitor your net worth your way.
Net Worth Calculators
If you simply want to know what your net worth is at any one time there are any number of online net worth calculators where you can enter the details of your assets and liabilities and the calculator completes the sum. However a net worth calculator will only tell you your net worth at the time and will not track your finances so you can look back and compare, you will have to manually visit the calculator each month for example, make your calculations and then go away and write them into a notebook or spreadsheet.
Tracking And Comparing Your Net Worth
The networthIQ.com online calculator does allow you to track your net worth over time so you can view the differences in your funds from month-to-month. Not only can you track your own net worth, you can also compare your results to those of other users. You can make your comparisons based on users who are of a similar age, occupation, income or education level to see how you compare to your peers. Comparing your net worth to other users of networthIQ.com should not be the only yardstick you measure yourself by, as a healthy net worth value is not determined by how you compare to others in your age and income bracket, it is how you compare to the net worth you should have based on your age and your income bracket.
Budgeting And Net Worth Calculations
There are a number of online tools which can gather information from all of your bank accounts, loans and credit cards and work as a comprehensive budgeting and net worth calculations tool.
Some of the most popular of these are Yodlee, Geezeo and Wesabe. [Note Geezeo is only available via certain banks.] These online tools automatically access your bank account balances on a monthly basis to give you an overview of your finances, coupled with a calculations of your net worth. Wesabe and Geezeo also allow you to ask for tips and information from other users, so you can find out more about what others have done in your situation. When using this function keep in mind that users of these online tools come from a range of backgrounds and experiences, and all they know about you is a list of financial figures, and so their advice may not always be pertinent to your own goals.
Also keep in mind how your bank details are being kept secure as Yodlee and Geezeo require you to upload all of your information on to the sites’ server, whereas Wesabe allows you to download software onto your computer where you enter your bank account details off-line and the software accesses your accounts from your own computer, you can then upload just the totals. Even though you are using online budgeting tools and net worth calculators to enhance your financial responsibility, you must not forget your security responsibilities in keeping your bank account details secure.
Net Worth Calculator Plug-In for Wordpress
[editor note - next 2 paragraphs are specific to writing your own blog]
If you already track and discuss your finances through a WordPress blog then you can use this net worth plug-in to help you more easily track and display your net worth monthly. To use the net worth plug-in you download the application onto your computer and embed the plug-in into your blog. All of the information remains stored on your computer and you can even choose to hide the values of some of your assets or liabilities which you don't want made public.
The net worth plug-in not only allows you to regularly track your net worth and progress, you can also encourage advice and comments from your dedicated and qualified followers. These are people who understand and know your aims and motivations, probably both personally and financially, because they follow your blog. This means you will get genuine and pertinent comments and advice on the results of the net worth plug-in embedded into your blog.
You can make calculating and tracking your net worth as basic or as involved as you like, but the important thing is that you remain aware of the state of your finances and you know your current net worth, and whether your finances are on track for a secure future.