Know Your Net Worth
Your net worth is the most important number for determining when you are financially independent. Once your net worth is more than 25x your annual spending, you can retire and never worry about running out of money.
My Current Net Worth = $160,394
As of Nov. 8, 2017, my net worth is right around $160k. This is only my retirement accounts so it doesn’t include any equity in my house, cars, or savings account balances. You can (and a lot of people do) include those but it’s a pain to update. I use Personal Capital to track my net worth and it automatically hooks in to my 401k and Roth IRA to automatically update my balances. Here’s what it looks like:
If you aren’t tracking your net worth you should start right away. This is the #1 number you need to keep track of. You can do it in a spreadsheet or automate it via Personal Capital which is completely free and takes about 5 minutes to get up and running.