Learn Series: #2
What is Liquid Net Worth?
While your total net worth tells you how wealthy you are on paper, your liquid net worth tells you exactly how much cash you can deploy in a real-world emergency tomorrow.
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The Definition (In Plain English)
Liquid Net Worth is the amount of cash you would have left over if you instantly paid off all your debts using only your liquid assets—the things you can sell for cash within 24 hours without taking a massive financial hit. It completely excludes "locked" wealth like real estate, gold jewelry, or retirement funds.
The Liquid Net Worth Formula
Cash & Fast Investments
Liquid Assets
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All What You Owe
Total Liabilities
=
Your Real Emergency Runway
Liquid Net Worth
What's In and What's Out?
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Counted (Liquid Assets)
- • Cash in Savings accounts & physical cash
- • Fixed Deposits (FDs) & Recurring Deposits
- • Mutual Funds & listed Stocks (easily liquidable)
- • Money Market / Liquid Funds
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Excluded (Illiquid Assets)
- • Real estate (Your flat, land plots)
- • Physical gold and ancestral jewelry
- • Locked funds (EPF, PPF, NPS retirement plans)
- • Your personal car or vehicle
Check Your Real Cash Runway
Don't get caught off guard by a sudden emergency. Separate your hard cash from paper assets automatically with our smart net worth breakdown tracking.