Statement of Net Worth: Definition, How to Calculate
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Quick Facts — Statement of Net Worth Lawyers
- Lawyers available: 13 estate planning lawyers
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What is a Statement of Net Worth?
A statement of net worth provides a snapshot of a person’s or business’ financial wealth. Statements of net worth are calculated by adding the value of all non-financial and financial assets owned by them and then subtracting the value of all its outstanding liabilities.
A statement of net worth is essentially a snapshot of a person’s or businesses’ financial position at any given point in time.
You can read more on net worth here .
How To Calculate a Statement of Net Worth
There are four steps to writing a statement of net worth:
- Calculate value of your assets : List your assets on a net worth statement. Using the current market value for each item, calculate the total value of all assets owned by you. Items like insurance policy also have a cash value which can be found on a schedule in the policy. Similarly, mutual funds, stocks, and bonds also have cash values that can be found on their quarterly reports.
- Calculate your Liabilities : Your liabilities should also be listed on your net worth statement. The balance owed on debts or credit cards, principle owed on a mortgage or real estate loan is considered a liability.
- Calculate the value of assets after subtracting liabilities: You will need to subtract the value of your liabilities from the value of your assets to determine your net worth. A negative net worth occurs when the total debt is more than the total assets. It is a sign that the company or individual needs to reduce their debt.
- Monitor your net worth annually: Complete a net worth sheet annually as your assets and liabilities might change or the values might change over time.
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What’s Included in a Statement of Net Worth
A statement of net worth largely includes assets and debts of an individual or business. Here are some types of assets and debts that might be included in a net worth statement:
- Savings & Checking Accounts
- Investments
- Life Insurance Policy
- Retirement Funds
- Personal Property
- Real Estate
- Credit Card Bills
- Mortgage Balance
- Car Loans
- Unpaid Taxes
- School Loans
A statement of net worth will include balance sheets, income statements and cash flow statements.
- Balance sheets : Balance sheets provide detailed accounting of a company or individual’s assets, liabilities and shareholders’ equity. Shareholders’ equity refers to the value that will be left if a company sells all its assets and pays off all its liabilities. This leftover money will belong to the shareholders of the company.
- Income statements : An income statement shows how much revenue a company made in a certain time period. In the case of an individual, it shows the amount of money earned by the individual in the time period.
- Cash flow statements : Cash flow statements report on a company’s inflows and outflows of cash. Cash flow statements can help determine if a company generated any cash. Cash flow statements can reflect the changes over time in income statements and balance sheets.
You can learn more about preparing your own statement of net worth here .
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Types of Statements of Net Worth
Types of statements of net worth can differ by entity. Companies, individuals, governments and countries use net worth statements in different ways. Here are how net worth statements are used by different entities:
Companies
Net worth in businesses is also known as equity. It is based on the value of assets and liabilities at the value expressed on financial statements. If items on the balance sheet do not express their true value, the net worth will also be inaccurate. If the accumulated losses exceed the shareholder’s equity in a company, the net worth becomes negative. Net worth here doesn’t express market value of the company as it may still sell for more if traded.
Individuals
For individuals, the net worth statement refers to the net economic value or the individual’s total assets minus the liabilities. Net worth statements can help individuals determine their financial status and plan for their future financial goals.
Governments
A government’s net worth, or a balance sheet of all assets and liabilities, is used to measure a government’s strength. Most governments use an accrual-based accounting system to provide transparency. Some might utilize cash accounting to better predict future fiscal events. Consistent accounting is necessary to determine the total net worth of a government.
Countries
A country’s net worth is the total net worth of all companies and individuals residing in the company plus the government’s net worth.
You can read more on types of statements of net worth here .
When Do You Need a Statement of Net Worth?
A net worth statement can help you measure progress towards long term financial goals. It can also help you keep track of your debts. If you are building wealth, you will also see your net worth statement changing. Having multiple savings, investments and debts can be difficult to manage. A net worth statement can help see your total financial situation.
A net worth statement also contains the value of your home and contents and can help you decide the homeowner’s insurance you will need to purchase. The total of your liquid assets can also provide information on how prepared you are for an emergency. A statement of net worth can also help you analyze your retirement savings or create future financial plans.
Companies use statement of net worth to assess the value of the company. Governments and countries also use statement of net worth to assess government debt.
Statement of net worth can often be required by lenders or investors to assess risk in providing an individual or business a loan. Scholarships and financial aid applications can also require net worth statements to assess eligibility. For the deceased, net worth statements can be used to assess value of their estate when in probate.
You can read more on net worth statements here .
Get Help With a Statement of Net Worth
Do you have any questions about statement of net worth and want to speak to an expert? Post a project today on ContractsCounsel and receive bids from estate planning lawyers and probate lawyers who specialize in statement of net worth.
ContractsCounsel is not a law firm, and this post should not be considered and does not contain legal advice. To ensure the information and advice in this post are correct, sufficient, and appropriate for your situation, please consult a licensed attorney. Also, using or accessing ContractsCounsel's site does not create an attorney-client relationship between you and ContractsCounsel.
Meet some of our Statement of Net Worth Lawyers
Alexander N.
Having overseen over $1.2 billion in transaction value, we are able to provide top-tier service at affordable rates, with much more personalized attention and fast turnarounds. After working for a AM Law Top 100 firm, I started my own firm and have been lucky enough to represent numerous conglomerates (FOX, Endeavor, etc.), promising startups, small businesses and private individuals. Our areas of expertise - Business Formations and Operating Agreements; Capital Raises and Debt Financing; Commercial Transactions; M&A; Real Estate; Intellectual Property; Employment and Hiring; Outside General Counsel; Corporate Agreements and Governance; Litigation and Dispute Resolution. We have been featured in The Wall Street Journal, Marketwatch, Yahoo Finance, Variety, Business Insider, Los Angeles Magazine, the LA Times, and others. We are driven by an unwavering commitment to our clients, going above and beyond to deliver results.
"This group was incredibly responsive and informative every step of the way."
Donya G.
Donya G.
I am a New York and Connecticut–licensed contracts attorney with over 25 years of legal and business experience. I focus on drafting, reviewing, and negotiating commercial agreements, advising small businesses and international brokerage firms — particularly in eCommerce acquisitions. My practice includes asset purchase agreements, master services agreements, operating agreements, employment agreements, and a broad range of commercial contracts, as well as merchant services defense, breach of contract matters and arbitration. I have served as General Counsel to small businesses, a Vice President at an investment bank, a Civil Court Arbitrator and Hearing Officer, and a Judicial Clerk to a Civil Court Judge. My combined legal and business background enables me to deliver practical, strategic counsel tailored to each client’s objectives.
"Donya was an amazing partner and was very patient and diligent in dealing with the APA and OA. I highly recommend her as she knows her stuff, is confident, and always has your back."
Michael M.
www.linkedin/in/michaelbmiller I am an experienced contracts professional having practiced nearly 3 decades in the areas of corporate, mergers and acquisitions, technology, start-up, intellectual property, real estate, employment law as well as informal dispute resolution. I enjoy providing a cost effective, high quality, timely solution with patience and empathy regarding client needs. I graduated from NYU Law School and attended Rutgers College and the London School of Economics as an undergraduate. I have worked at top Wall Street firms, top regional firms and have long term experience in my own practice. I would welcome the opportunity to be of service to you as a trusted fiduciary. In 2022 and 2023, I was the top ranked attorney on the Contract Counsel site based upon number of clients, quality of work and number of 5 Star reviews.
"Michael's expertise and judgment impressed me. I brought him in for contract advisory work, and he quickly asked the questions I hadn't considered, identified the risks that mattered, and set aside the ones I had wrongly prioritized. He changed how I understood the contract. He is an excellent advisor - highly recommended."
May 11, 2026
Kendra B.
My law practice focuses on transactional business law and serving as outside general counsel for small businesses in Minnesota. I provide practical counseling on a range of day-to-day legal matters and prepare contracts tailored to meet your specific business needs.
May 12, 2026
Sarah B.
Experienced U.S.-licensed attorney with 10+ years of practice across commercial transactions, regulatory compliance, and contract drafting, currently in a part-time in-house counsel role and actively available for independent legal engagements on a project or contract basis. Proven ability to deliver efficient, high-quality legal work in flexible arrangements, including prior contract engagements with Am Law 100-affiliated firms. Adept at working autonomously, meeting tight turnarounds, and providing practical, business-focused legal counsel across a wide range of transactional matters.
Grace C.
May 12, 2026
Grace C.
I’m Grace E. Carlson, an intellectual property & transactional attorney, founder of aTMospheric IP, LLC, with over 6 years of combined law firm and in-house experience. I help businesses, startups, creators, and entrepreneurs draft, review, and negotiate commercial contracts while protecting their brands and innovations. My expertise includes SaaS agreements, MSAs, NDAs, licensing contracts, vendor and partnership agreements, as well as comprehensive trademark strategy, copyright matters, AI-related IP issues, and technology transactions. I’ve supported global companies including Robinhood, Iron Mountain, and Microsoft, and provided flexible in-house counsel through Axiom Law across fintech, SaaS, consumer goods, and data center industries. Known for translating complex legal issues into clear, practical solutions, I focus on delivering contracts that reduce risk, support go-to-market strategies, and scale with your business. Whether you need a custom SaaS agreement, trademark-integrated contracts, or AI compliance review, I provide responsive, business-minded counsel. Bar Admissions: Washington (2020) & Oregon (2021) J.D., Seattle University School of Law Let’s get your contracts and IP protections done right — efficiently and effectively.
Amy T.
Northeast Ohio attorney providing comprehensive legal services in business law, real estate law, estate planning, and transactional matters for individuals, entrepreneurs, and growing companies. Practice areas include business formation and structuring, contract drafting and review, partnership and operating agreements, commercial transactions, business purchases and sales, and ongoing legal counsel for small and mid-sized businesses. Also represents clients in residential and commercial real estate matters, including purchases, sales, leases, title and closing issues, and property-related agreements. Estate planning services include wills, trusts, powers of attorney, healthcare directives, and probate and estate administration designed to protect clients’ assets and long-term goals. Known for practical guidance, responsive communication, and helping clients navigate complex legal matters with clarity and confidence.
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Doc Type: Statement of net worth
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