How I Measure Net Worth

It is clear from previous posts that I think money goals are more often rabbit holes than helpful. This push away from numbers has led to a certain degree of market apathy. I just don’t want to spend my time pouring over numbers all day and worrying about returns. We in the financial community, however, are trackers by nature. If it is not measurable, than does it exist? Since I don’t update my Personal Capital account and I have stopped paying attention to Mint, I often get asked how I measure net worth.

The simple answer is that I don’t. I obviously have a pretty good estimation, but I am not interested in the day-to-day gyrations. The more complex answer is that I focus on qualitative and less on quantitative measures.

Time

If you ask me how I measure my net worth, I answer in seconds, minutes and hours. Time is one of the major ways in which I flaunt my wealth. I have an exceedingly high net worth. It has nothing to do with wages or savings. It’s all about free time.

After reading my blog and learning about my life, I often get asked how I fit it all in. But the truth is, I generally feel like I have an abundance of time during the week. In fact, on most days I spend hours on me time. Not even including work, this is how I spend my day:

1-2 hours pleasure reading
1-2 hours walking/working out
1 hour writing
2 hours television

I get home from work on most days before 2pm. I am usually around when the kids arrive from school, and we always eat dinner together as a family.

If the old saying that money is time is true, than I am truly rich.

The No factor

How do I measure net worth? I measure it in no’s. The more often I get to say no to activities that I despise, the more wealthy I am.

Do you want to take on these extra responsibilities at work? um no.

Do you want to go to that Friday night client meeting? Nope.

How* about that mandatory team building weekend?* Sorry.

If you find that you can comfortably say no to the barrage of questions, requests, and usurpations of your time, than you have riches beyond your dreams.

Control

Ultimately it comes down to control as a factor in how I measure net worth. Whether controlling your time, ability to say no, or the other thousand inconveniences of modern-day life. No matter how much cash you have in the bank, if you are a slave to a job, or bound to keeping up with the Joneses, you are truly poor.

Final Thoughts

I have plenty of money. But money is not how I measure net worth. My form of wealth is the freedom to control how I spend my time. The richness of saying no as often as necessary to avoid onerous activities. And finally the control and power to feel a sense of ownership in daily life.

Therefore, I have stopped looking at the numbers. Although I bend towards frugality, I rarely pay attention to budgets. My Personal Capital and Mint accounts are all flashing warning signs that they need to be updated.

And I couldn’t be happier.