Glossary
Net worth
Net worth is everything you own minus everything you owe. In a personal finance app it is the sum of every account balance, converted to one currency, with debts counted as negative balances.
Net worth answers 'how am I doing', because it moves only when your position changes. Income and spending are flows over a period; net worth is a stock at a moment.
It beats a bank balance because it counts every account together: current accounts, savings, cash, and the card balance you have not paid yet. Chillar's converts accounts held in other currencies to your base currency before adding them.
Related terms
- Cash flowCash flow is the money that came in minus the money that went out over a period. Positive cash flow means you finished the period with more than you started; negative means you drew down savings.Read
- Base currencyYour base currency is the single currency all totals are reported in. Accounts can be held in any currency; each balance is converted to the base currency before net worth, budgets and reports are calculated.Read
- Savings rateSavings rate is the share of your income you did not spend, expressed as a percentage. It is calculated as income minus expenses, divided by income, over the same period.Read
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