Since I’m starting anew on this site about putting your family in the best financial position possible, I should warn you that your first goal should be nothing.  Zip. Zilch. Nada. Nothing.

I’m talking about your net worth here, this is one that is scary to calculate if you love your credit cards.  Visa, Mastercard, and Discover love you back so long as you pay your minimum payments on time, granting you nifty rewards points that make you feel better about spending, even though you need to spend 5 times the limit of your card to get anything worthwhile.  If you’re in a position like this, a zero net worth should be your first step to financial freedom.

 How do I calculate my net worth?

This is surprisingly easy.

First take all your assets, (Cars, homes, bank account balances, stocks, bonds, etc.) and total them up.  As of last night, mine were worth $11,313.57 (I could’ve included life insurance here too since it’s an asset for my family, but since I can’t spend it now I don’t count it.) .  Then take all of your debts (car loans, credit cards, mortgages, student loans) and total those up as well.  Mine as of last night were $38,704.60.  Finally subtract your debts from your assets (-$27,391.03) for me.

That is correct, I have a negative net worth.

If you were to look at my financial picture 8 months ago, it wouldn’t be so bad, but I got married, so I added a significant amount of credit card debt to my net worth, bringing it down.  Right now though, we have no credit card debt, and since the wedding we have increased our net worth almost $5000.  So at this rate of $1000 a month, it should take us a little over 27 months to reach the zero point.

So, as we go into how to start a budget, we have our primary goal, $0.00, a big fat goose egg, nothing at all.