The short answer
- Add up everything you could turn into money this month if you had to. Add up everything you owe. Subtract the second from the first.
- Count what you own outright, not what you paid for it.
- Count the full balance you owe, not this month's instalment.
- Recheck it once a quarter, on the same day, in the same file.
- The direction matters more than the figure today.
The four columns
- Cash: current accounts, savings, and money sitting in payment apps, each with the date you checked it.
- Sellable things: anything you could turn into money within a week, valued at what it would actually fetch rather than what it cost.
- Owed to you: unpaid invoices and money you have lent, with an honest note about whether it will arrive.
- Owed by you: card balances, loans, instalments, and any tax you already know is coming.
- One line at the bottom: total minus total. That is the number, and it is arithmetic, not a judgement about you.
Why a page beats an app for this
The figure is meant to inform a decision every three months, so an account you must log into daily is the wrong shape for it. A dashboard that updates constantly invites you to watch it, and watching a number that moves with the markets teaches you nothing you can act on.
A page in the file you already keep has one advantage that no app has: it is boring. Boring is why it survives a bad month.
- Write the date beside every value. A stale figure is worse than no figure, because you will trust it.
- Anything behind a login gets checked in a good month and ignored in a bad one.
- Keep one line of history per quarter. Four lines a year are enough to see a shape.
What to do with the number
Two useful things, and no more. First, it shows whether what you owe is shrinking faster than what you hold grows. That comparison is arithmetic, not advice, and it is usually enough to change one decision.
Second, once you know roughly what you are aiming at, the free saving goal calculator turns a target and a monthly amount into a plain answer about time. It asks for your own numbers and sends nothing anywhere, so you can try three versions of the goal in five minutes.
- If the number fell, find the single line that moved most. That is the whole investigation.
- Do not set a target you cannot state in one sentence.
- Do not include a house or car you would never sell. Counting things you intend to keep makes the figure flatter you and move less.
The free tool for this
How long a goal takes at a set amount - How long a goal takes at a set amount. It runs in the page, asks for your own numbers, and sends nothing anywhere.
If you would rather not build it yourself
Money Map holds the year in one workbook: fixed costs, a ten-minute weekly spending log, category shares, debt maths and a net worth line that moves when you update it. Money Map is $14. See it on the shop, and there is a plain page about it here: what it holds.
Questions people actually ask
Should I include my home or my car?
Only if you would genuinely sell it. Most people would not, and including it hides the change you are trying to see. If you are unsure, leave it out and note the choice in the file.
How often should I redo it?
Quarterly, on a fixed date. Monthly turns into noise and a chore, and yearly is too slow to change anything you do.
Read next
How to make a household budget you will still be keeping in February, How to budget when your income changes every month.