Knowing the value of your assets is important because assets are one of the main inputs used in calculating your net worth, therefore it is crucial to understand what assets are. An asset is something that has value or provides a future economic benefit—assets are things you own. When calculating your net worth, some of your assets will be easy to think of, like the cash in your bank account, and the stocks, bonds and real estate you own. However, anything that has value is an asset, which includes things like the value of your car, artwork or other consumer goods you could sell.
It is up to you how deep you want to go in calculating the value of your assets in order to determine your net worth. For example, determining the value of all the clothes you own or the value of your electronics may not be worth the time it takes to come up with an accurate estimate. For me, I add up the total cash in my bank accounts, the value of my investments and the value of my vehicle, and then stop there for convenience sake. Create a template or use the one provided in the Tools page so you can keep track of your assets over time. Remember, to increase your net worth, the goal is to increase your assets while simultaneously decreasing your liabilities.