Publisher: WM STUDIOS. Last updated: 21 August 2026. This page describes a calculation method. It is neither investment advice nor financial planning advice.
Gross and net: two different numbers
Gross wealth is the total of what you hold: financial assets, property, any business assets, and the rest (vehicle, valuables). It is measured before any loan is deducted.
Net worth takes off the principal you still owe on your borrowings, whatever their purpose. That is the definition used by Insee, the French statistics office, and it is the only one of the two numbers that answers the question « what is actually mine today ».
Both are useful, but they tell different stories. Someone who has just bought a home shows a high gross figure and a net figure sometimes close to zero. Tracking gross alone gives an impression of wealth that the liabilities contradict.
The costliest mistake: subtracting the payments
This is where most of it is decided. What you take off is the outstanding principal, meaning what it would cost to settle the loan today. It is not the sum of the payments you have left to make.
The gap between the two is future interest. You do not owe it yet: it pays for capital you have not finished borrowing. Repay early and it vanishes. Counting it as a liability makes you poorer by a debt that does not exist.
The gap is not trivial. Take a 200,000 € loan over 20 years at 3.50 %, a payment of 1,159.92 € a month. After five years of repayments, 180 payments remain.
| What you subtract | Amount | Effect on net worth |
|---|---|---|
| Outstanding principal (correct) | 162,253 € | reference |
| Sum of remaining payments | 208,785 € | understated by 46,532 € |
Nearly 46,500 € of error on a single loan, from a one line confusion. The outstanding principal appears on your amortisation schedule and on your bank's annual statements: that number, and only that one, belongs in the calculation.
What makes up the asset side
There is no binding official list for a private individual, but the Insee breakdown is clear and sufficient.
- Financial: current accounts, savings accounts, securities accounts, French PEA, life insurance, retirement savings, employee share schemes.
- Property: main residence, buy to let, shares in property companies, land.
- Business assets, where applicable: company shares, goodwill, equipment.
- Residual: vehicles, valuables. Handle with care, see below.
What makes up the liability side, the half often forgotten
Liabilities are not limited to the mortgage, even though it accounts for most of them in most households.
- Mortgage: outstanding principal, loan by loan if you have several.
- Consumer credit, car finance, revolving credit: same principle, outstanding principal.
- Overdraft in use, deferred debit card balances not yet taken.
- Amounts due: tax owed and not yet paid, building works levies already voted, maintenance to be paid.
- Family loans, where they are real and documented.
A point of method: a liability is not netted off against the asset it financed. If your home is worth 300,000 € and the outstanding principal is 162,253 €, you record both numbers, not their difference. Otherwise you lose sight of what moves: the value of the property and the debt do not change at the same pace.
A full example
| Item | Type | Amount |
|---|---|---|
| Main residence | Asset | 300,000 € |
| Securities account and PEA | Asset | 62,000 € |
| Life insurance (surrender value) | Asset | 28,000 € |
| Savings and current accounts | Asset | 15,000 € |
| Gross wealth | 405,000 € | |
| Mortgage, outstanding principal | Liability | 162,253 € |
| Car finance, outstanding principal | Liability | 7,400 € |
| Net worth | 235,347 € |
The same wealth reported gross comes to 405,000 €, net to 235,347 €. The gap, 42 % of the gross figure, is precisely what tracking assets alone does not show.
Valuation pitfalls
The formula is simple; the numbers you put into it less so. Four precautions.
Property has no quoted price. Its value is an estimate, and an optimistic estimate mechanically inflates your net worth. A cautious and above all stable convention beats revaluing on a whim: what matters in a tracker is being able to compare two dates.
Securities are valued at the last known price, bearing in mind that closing prices are often delayed and that a fund priced once a day may show the previous day.
Currencies add a variable. A portfolio held in dollars changes value in euros without a single position moving. The rate used has to be dated, otherwise comparing two statements mixes the market effect with the currency effect.
Residual assets are easily overstated. A vehicle depreciates quickly, and valuables do not resell at their purchase price. Many trackers leave them out entirely, which gives a lower but more reliable net figure.
Where the answer is different
Shared ownership. Held jointly or as a couple, your personal net worth covers only your share, assets and liabilities alike. In France the matrimonial regime determines that split, so the same property may count in full, by half, or not at all depending on the situation.
Life insurance. What counts is the surrender value, what you would receive by exiting today, not the sum of your contributions.
Locked savings. A retirement savings plan is an asset even when it cannot be accessed before its due date. It therefore counts towards net worth, but treating it as available savings gives a misleading picture of your room for manoeuvre. Many trackers separate it out for that reason.
Unrealised gains. Some people deduct the tax that would fall due on a sale, to obtain an after tax net figure. That is a convention, not an obligation, and it requires freezing assumptions (exit date, applicable regime). What matters is picking a convention and sticking to it, otherwise the time series stops meaning anything.
Where to find this calculation in PulseMyPortfolio
Net worth is one of the application's central views. You declare your accounts, as many as you need and of every type, then your loans and mortgages: the application tracks the outstanding principal over time and deducts it from the asset side, never confusing it with the payments still to come. Positions are valued automatically, with dated currency conversion.
The application describes your situation; it does not tell you what to do about it. It recommends no transaction, no reallocation, no asset mix. Every calculation runs on your device.
Sources
- Insee, definition of net worth (in French).
- Insee, gross household wealth (composition of the asset side).
- Insee, household wealth and debt (long series).
The loan example uses a standard fixed payment amortisation: 200,000 € over 20 years at 3.50 %, after 60 payments made.
Further reading
The page on computing a capital gain from the weighted average acquisition price covers valuing the securities side. The frequently asked questions cover how the application works.