Generally, yes. More specifically, in financial planning, the term “net worth” refers to the total value of an individual’s assets minus their liabilities. Assets can include cash, investments, retirement accounts, and tangible property such as real estate, cars, and other valuables. Liabilities encompass debts like mortgages, car loans, student loans, and credit card balances.
In most cases, the value of one’s primary residence is included in the calculation of net worth. However, it’s important to note that the value of the home is typically based on its current market value, not the purchase price. Additionally, any outstanding mortgage balance or home equity loans would be counted as liabilities, reducing the net worth.