What is net worth? Why it matters and how to grow yours
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What net worth really means
Net worth is simply the difference between what you own (assets) and what you owe (liabilities). Think of it as your financial scorecard, a single number that represents your overall financial health.
Your personal net worth includes everything you own of financial value minus your debts. This includes:
- Assets: Your home, vehicles, investments, cash and valuable possessions like art or jewelry.
- Liabilities: Mortgages, car loans, student loans, credit card debt and any other money you owe.
For example, if you own a $500,000 home with a $300,000 mortgage, have $100,000 in retirement savings, $20,000 in a savings account, but carry $10,000 in credit card debt, your net worth would be $310,000 ($620,000 assets - $310,000 liabilities).
For businesses, net worth (often called equity or book value) represents the company's assets minus its liabilities. This figure indicates the company's financial strength and what would remain for shareholders if all assets were liquidated and all debts paid.
When we talk about celebrity net worth, we're referring to the estimated value of their total assets (properties, investments, business ventures) minus their liabilities. These figures often make headlines but are typically estimates based on publicly available information.
Average net worth by age and income in Canada
According to Statistics Canada data, the median net worth for Canadian households in 2023 was approximately:
- Age 25-34: $48,800
- Age 35-44: $234,400
- Age 45-54: $521,100
- Age 55-64: $690,000
- Age 65+: $543,200
Those in the top 20% of income earners had a median net worth over $1.2 million, while the bottom 20% had a median net worth of just $9,500.1
Net worth at death
When someone passes away, their net worth becomes their estate. After paying outstanding debts and taxes, the remaining assets are distributed according to their will or provincial intestacy laws. This highlights the importance of estate planning to protect your net worth and ensure it goes to your intended beneficiaries.
How to calculate your net worth
Calculating your net worth is straightforward. Here's how to do it:
1. List all your assets: Include real estate, vehicles, investments, retirement accounts, cash, and valuable personal property.
2. Determine asset values: Use current market values, not what you paid originally.
3. List all your liabilities: Include mortgages, loans, credit card balances, and any other debts.
4. Add up both columns: Total all assets and total all liabilities.
5. Subtract liabilities from assets: The result is your net worth.
Net worth calculator
Use the formula Net worth = Total assets − total liabilities to calculate your net worth. Just enter your assets and liabilities below.
Your data stays private — all calculations are done locally in your browser.
Total assets: $0
Total liabilities: $0
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Your net worth is: $0
Related read: Net worth calculator - get the full picture
Sample net worth | assets vs. liabilities
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Understanding where you stand compared to others can provide valuable context for your financial journey. Here's how Canadians stack up:
What does it mean to be in the top 1%?
- Top 10%: Annual income of $111,900
- Top 5%: Annual income of $147,100
- Top 1%: Annual income of $283,200
- Top 0.1%: Annual income of $906,700
- Top 0.01%: Annual income of $3,404,700
Note2: Data is current as of 2022.
The top percentiles
Where do you stand?
Your net worth may be lower than these figures if you're early in your career — that's completely normal. What matters most is consistent growth over time and making smart financial decisions at each life stage.
What is a high net worth individual in Canada?
In Canadian financial circles, high net worth individuals (HNWIs) are classified into several tiers based on their wealth:
- High net worth (HNW): Individuals with investable assets of $1 million to $5 million (excluding primary residence)
- Very high net worth (VHNW): $5 million to $30 million in investable assets
- Ultra high net worth (UHNW): Over $30 million in investable assets
According to the latest wealth reports, Canada is home to approximately 375,000 HNWIs, with concentrations in Toronto, Vancouver, Montreal, and Calgary. This number has grown steadily over the past decade despite economic fluctuations.
HNWIs typically require specialized financial services, including:
- Private banking and wealth management
- Tax optimization strategies
- Estate planning and trust services
- Alternative investments and private equity opportunities
- Customized insurance solutions
Best credit cards for high net worth individuals
Related read: Find your best credit card
How to grow your net worth over time
Growing your net worth requires different strategies at different life stages. Here's how to maximize your financial growth throughout your life:
- Focus on building employable skills and increasing income
- Establish solid credit and avoid high-interest debt
- Begin retirement savings, even small amounts (compound interest is powerful)
- Build an emergency fund to avoid debt setbacks
- Accelerate retirement contributions (aim for 15-20% of income)
- Consider homeownership if it makes financial sense in your market
- Increase your income through career advancement or side hustles
- Max out tax-advantaged accounts like TFSAs and RRSPs
- Avoid lifestyle inflation as your income grows
- Reassess investment allocation and risk tolerance
- Accelerate mortgage payments if possible
- Begin college savings for children if applicable
- Maximize retirement contributions with catch-up provisions
- Reduce debt aggressively, especially high-interest debt
- Protect your wealth with appropriate insurance coverage
- Consider downsizing if housing costs are high
- Shift toward capital preservation while maintaining growth
- Create retirement income streams
- Optimize withdrawal strategies to minimize tax impact
- Consider estate planning to protect your legacy
Key wealth-building strategies
- 1 Pay yourself first: Automate savings and investments before you can spend the money
- 2 Maintain a debt reduction plan: Focus on high-interest debt first
- 3 Invest consistently: Dollar-cost average into diversified investments
- 4 Mind the tax implications: Utilize tax-advantaged accounts and strategies
- 5 Protect your assets: Insurance and emergency funds prevent wealth destruction
Don't know how to invest or pay yourself first? Automate your investments with some of our favourite robo-advisors and watch your wealth grow.
Need to get debt under control? Compare the best budgeting apps in Canada
Real-time net worth and celebrity fascination
Our fascination with celebrity wealth isn't just about voyeurism, it's about aspiration and benchmarking. Websites tracking the wealth of famous individuals receive millions of visitors monthly, demonstrating our collective interest in wealth accumulation.
Canada's wealthiest individuals
- David Thomson & family: $49.2 billion (Thomson Reuters)
- Jim Pattison: $12.2 billion (Jim Pattison Group)
- Chip Wilson: $7.8 billion (Lululemon founder)
- Galen Weston & family: $7.3 billion (Loblaw, Shoppers Drug Mart)
- Mark Scheinberg: $7.1 billion (PokerStars co-founder)
Notable Canadian celebrities
While these figures may seem unattainable, remember that many wealthy individuals built their fortunes gradually through disciplined saving, strategic investments and capitalizing on their unique skills and opportunities.
Here's how to build your fortune like the stars.The key difference between average and exceptional wealth growth is usually systematic investing, business ownership, and avoiding lifestyle inflation as income increases.
Net worth tools, advisors and insurance options
Managing and growing your net worth becomes easier with the right tools and professional guidance:
Net worth tools
Financial advisors
Different wealth levels benefit from different advisory approaches:
- 1 Beginning investors: Robo-advisors offer low-cost automated investing
- 2 Mid-level wealth: Fee-based financial planners provide comprehensive guidance
- 3 High net worth: Private wealth managers offer tailored solutions and exclusive investment opportunities
Insurance protection
As your net worth grows, so does your need for protection:
- Umbrella insurance: Extends liability coverage beyond standard policies
- Professional liability insurance: Protects against claims related to your career
- Comprehensive life insurance: Ensures your family maintains their lifestyle
- Critical illness insurance: Protects your wealth from health-related setbacks
FAQ
Last updated
May 20, 2025
Tyler Wade
Personal finance content strategist & writer
Tyler Wade has worked in personal finance for over 5 years writing for brands like Ratehub, Forbes, KOHO, and now Money.ca.
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