🐧 How to track your net worth (and nail your life goals)

Today, in 10 minutes or less, you’ll learn:

• 🦚 Why tracking net worth isn't just about ego—it's a powerful tool for achieving life goals
• 🎯 The 6-step process to determine if you're on track to meet your long-term financial goals
• 🌉 Practical strategies to bridge the gap between your current finances and your life goals

FROM OUR PARTNERS

🚀 Supercharge your newsletter with Beehiiv

Beehiiv is Money Abroad's secret weapon.

It’s the ultimate all-in-one newsletter platform.

When deciding between email service providers, I chose Beehiiv for its:

• Easy-to-use interface
• Powerful features like automations, API, and data
• Built-in growth capabilities like polls, surveys, and referrals
• And automated monetization via its ad network

But you don’t have to take my word for it…

Start Your 30-Day Free Trial

Plus, get 20% off your first 3 months on any paid plan

🎯 How to Track Your Net Worth (and Nail Your Life Goals)

Tracking net worth is just for stroking your ego.

👆️ I disagree with this POV.

Perhaps you’re starting a family and want to buy a 3-bedroom house in the Sunset in San Francisco.

Or maybe you’re fretting about the rising cost of university tuition:

If you have long-term goals, then net worth tracking will help you.

In this newsletter, I break down step-by-step how to track your couple net worth using the Money Abroad Net Worth Tracker and boost your confidence to achieve life goals.

‍

Step 1: Determine your life and money goals

Recently, I wrote about combining your finances with your partner.

One common challenge is agreeing on the “why.”

Or your money philosophies.

This requires diving into the nitty gritty of your relationship with money, how your childhood households treated money, and how you want money to support your shared vision for your life together.

What life goals do you envision as a couple?

• Do you want to have a kid and start a family?
• Do you want to buy a home?
• Do you want to save for retirement?

Many of these goals will benefit from long-term financial planning.

The point of tracking net worth is not to stroke your ego…

… but to help you and your partner determine if you’re on track to achieving these long-term goals.

For example:

My wife and I recently opened a 529 account - a tax-advantaged investment account designed to (partially) fund our future kid’s education expenses.

This is planning at least 20 years in advance.

When my wife was 13, her parents set the expectation that she’d be responsibility for her university education costs. (Australian universities are more affordable than in the US.)

In contrast, I worked hard to get scholarships and grants to fund ~65% of my college expenses, with my parents covering the rest.

As a couple, we prefer for our future kids to fund their own university expenses, while creating a safety net in case they want to study overseas or attend an elite institution.

The 529 account is this safety net.

Investing $X in the 529 account is one of our money goals.

‍

Step 2: Calculate the financial amount of your Life Goal(s)

Let’s take Kid’s Education as an example.

Say you want to save $200,000 in today’s dollars in 20 years.

(This is just a number I made up.)

At 3% inflation rate, that means your goal amount is $361,222 in inflation-adjusted dollars:

‍

Step 3: Calculate your current Net Worth

Now sum all your balances across accounts within each category.

For both you and your partner.

I group asset categories as:

• Cash, T-Bills & Bonds
• Public Investments
• Real Estate
• Crypto
• Private Investments
• Company Equity (409A/RSU)

I group liability categories as:

• Credit Cards
• Student Loans
• Mortgage
• Unpaid Tax

Your net worth = assets - liabilities.

In this example, I exclude company equity from net worth (you can exclude other high-risk assets like crypto or private investments as well).

By measuring balances monthly or quarterly, you’ll see changes in your financial health over time.

‍

Step 4: Estimate your projected Net Worth

Now, estimate your projected Net Worth using interest rate assumptions.

You’ll see in a minute, but this will help you spot any savings shortfalls for your Life Goals.

I would recommend using conservative figures here.

As a reference, here’s the total real returns of various assets over the past two centuries:

‍

Step 5: Evaluate whether your projected Net Worth is sufficient to achieve your long-term goals

Finally, we tie everything together.

Compare how much you’ll need to save/invest by goal date WITH your projected net Worth at goal date.

This will answer the question:

“Do we have enough money invested (and can be liquidated) to fund our Life Goals?”

Caveats: We didn’t factor in liabilities or taxes to keep the math simple. I also included potentially illiquid assets (RSUs, private investments), but you should remove these to calculate your liquid or “investible assets.”

‍

Step 6: Take action based on this analysis

If you discover that your projected Net Worth falls short of your Retirement Goal, ask yourself:

1. What’s the shortfall amount?
2. How much additionally do you need to save and invest to fill the gap?
3. Can your current and future income support this additional investment?

If yes, then increase your monthly investing contributions.

If no, then consider:

1. Can you increase your income through other means? E.g. getting a promotion/raise, finding a new job, starting a side hustle.
2. In the worst case, can you adjust your goals downward?

I want you to balance thinking big while staying realistic.

Try to exhaust methods of growing income before downsizing your goals.

‍

✅ Run your own analysis using our Net Worth Tracker

Did you like this quick tutorial?

Tracking our couple Net Worth has made me more confident in our ability to achieve our Life Goals.

Give this a try with your own finances:

→ Download the Ultimate Net Worth Tracker ←

🌐 Beyond your borders

👋 Meet the HENRYs: The Six-Figure Earners Who Don’t Feel Rich (WSJ)

🎹 Why Spotify is still all-in on remote work (FC)

🇸🇬 What are the most profitable side hustles in Singapore? (SBR)

🧠 Social snippets

Christopher Ming has lived every remote worker’s dream.

I chatted with Nicole at Work, Wealth, and Travel Podcast about navigating finances across continents. Listen on Spotify or Apple Podcasts:

256. Navigating Finances Across Continents & Maximizing Wealth as a Nomad | Dexter Zhuang

Quickly and easily listen to Work, Wealth & Travel - A Digital Nomad Podcast for free!

player.captivate.fm/episode/27164a7a-e4bf-4b11-b436-be56e750f8b6

For daily insights, follow me on Linkedin or Threads.

FROM OUR READERS