Enter your total liquid assets and your total liabilities into the calculator to determine your liquid net worth.
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Liquid Net Worth Formula
The following equation is used to calculate a business or individual’s liquid net worth.
LNW = LA – LB
- Where LNW is the liquid net worth
- LA is the liquid assets
- LB is the total liabilities
Liquid Net Worth Definition
Liquid net worth is defined as the total net worth of a company or individual that is in either cash or assets that can be easily converted to cash.
Liquid Net Worth Example
How to calculate a liquid net worth?
- First, determine the total liquid asset value.
Calculate the total value of all liquid assets.
- Next, determine the total liabilities.
Measure the total value of all liabilities.
- Finally, calculate the liquid net worth.
Using the equation above, calculate the liquid net worth.
Liquid net worth is the total net worth of an individual or business that is liquid. This means that the assets are easily converted to cash, or are already in cash or cash equivalents.
All liabilities should be included when using the formula. Normally. this results in one’s liquid net worth often times being negative, as intended.