# Liquid Net Worth Calculator

Created by Wei Bin Loo
Reviewed by Tibor Pál, PhD candidate and Adena Benn
Last updated: Sep 22, 2023

We have written this article to help you understand the liquid net worth definition and how to calculate liquid net worth. We will also demonstrate some examples to help you understand the liquid net worth calculation.

## What is liquid net worth? Liquid net worth meaning

The liquid net worth definition is the amount of your net assets that can be converted into cash in a really short time. This is an essential metric to comprehend as it allows you to understand better what you can afford. Furthermore, knowing your liquid net worth can help you to manage your debt more efficiently.

Next, let's look at how to calculate liquid net worth.

## How to calculate liquid net worth?

To understand the liquid net worth calculation, let's take Mirabelle as an example:

• Name: Mirabelle
• Total liquid assets: $120,000 • Total liabilities: $50,000

You can calculate your liquid net worth in three steps:

1. Determine your total liquid assets:

The first step is to determine the total liquid assets you own. Liquid assets are assets that can be converted into cash in a really short time.

For our example, Mirabelle's total liquid assets is equal to $120,000. 2. Determine your total liabilities The next step is to calculate your total liabilities. You should include any liabilities or debt that you own. In this example, Mirabelle's total liabilities are worth $50,000.

3. Calculate the liquid net worth

The last step is to calculate the liquid net worth. We can achieve this by using the following formula:

liquid net worth = total liquid assets - total liabilities

### How can I calculate my liquid net worth?

You can calculate your liquid net worth in three steps:

1. Determine your total liquid assets
3. Apply the liquid net worth formula: liquid net worth = total liquid assets - total liabilities

### Can liquid net worth be negative?

Yes, liquid net worth can be negative. This happens when your total liabilities are more than your total liquid assets. This means that you cannot pay back all your debt in a short time.

### What is liquid assets?

Liquid assets are the assets that can be easily turned into cash when needed. These assets are valuable as they allow you to pay back your liabilities in a really short time.

Wei Bin Loo
Total liquid assets
$Total liabilities$
Liquid net worth
\$
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