Net Worth vs. Self Worth

STEVE SMALENBERGER, EA®

We use benchmarks in all different areas of our lives:

A carpenter uses a measuring tape.  A student uses a GPA. A coach uses a win-loss record.

In our financial life we use a measurement too.  The measurement is known as net worth. But, is net worth the same as our self worth?  Let’s talk about it.

What’s the difference between net worth and self worth?

Net worth by definition is:  the net (after all accounting) worth (value or justification I give it).  That advice was “worth” it versus self worth (I’m perceiving or giving this a value) which isn’t a calculation.  Net Worth is all your assets minus liabilities.

Self Worth is made up of characteristics, feelings, or perceived value I give something.  Here are some areas that contribute to how you value your self worth.

1. Relationships:  Who are my friends, family members, or people I know that I’m associated with?
2. Occupation:  Especially for men, this can be a big factor in self worth.  Typically men will ask each other “what do you do?” and that immediately gives that person value.  You have the thought “I’m going to continue to talk to you.”
3. Salary:  Am I making more than I did last year?  Am I making as much as my co-worker?
4. Bank Account:  How much money do I have in the bank?  Especially on shows like Shark Tank, someone being worth a lot of money demands a value of them as a person.
5. Accomplishments:  What have I earned or done?  What plaques or trophies do I have on the wall?
6. Physical Features:  How does someone look or talk?  Are they active or lazy?

These are all values that we put on people.  To summarize, your net worth is not the same as your self worth.  Don’t confuse the two. They’re not the same. Life’s not about either.  Ultimately how you choose to measure yourself will impact the choices you make.

View Next