Everything we own belongs to God (I Chronicles 29:14; Psalm 24:1). God expects us to be good stewards of these blessings, which requires our diligent attention to financial matters (Proverbs 27:23-27). However, there is an obvious risk that we, as children of God, may overemphasize material concerns (Luke 12:20-21). Therefore, we must walk a fine line between paying enough attention to our financial situation to be diligent stewards for God, without becoming consumed or absorbed with our financial concerns.

 

The fundamental equation of accounting says that net worth is equal to the value of all your assets, minus the value of all your liabilities. Companies must routinely calculate net worth and, in the case of public firms, are required to publish the details of this equation in their balance sheets every quarter. As a company’s asset values and debt levels change over time, the changes in the balance sheet provide a type of “motion picture” of the firm’s financial health.

 

Individuals and families can calculate their net worth, also. Simply write down the total value of everything you own; then subtract the total value of everything you owe. I believe this is a good practice to help a family track its progress in meeting goals related to diligent financial stewardship, such as saving for retirement or college, or getting out of debt. It also serves as an excellent motivational tool, particularly for a family that is trying to change bad financial habits. If I have accumulated large debts, for example, and have set a goal of being debt-free, it helps me keep going if I can clearly measure my progress as the liability side of my net worth equation steadily goes down, while (hopefully) the asset side steadily goes up. Computing your net worth every six months or so can serve as an excellent gauge of how well you are managing the blessings God has given you.

 

Like many good ideas, calculating your net worth comes with some possible pitfalls. For example, if I become consumed with a specific financial goal (say, becoming debt-free by the end of the year), what happens when I am faced with an opportunity to help someone in need? Will I pause to consider the effect that helping someone will have on my net worth? I must never do that, but must always remember I John 3:17:

 

 

Not only do some fail to help the needy, some even stoop so low as to try to take advantage of them. The Scriptures are filled with condemnations of those who would engage in such despicable acts, and Solomon tells us that they “will surely come to poverty” (Proverbs 22:16).

 

An unhealthy concern for my net worth might also lead me to take shortcuts to wealth by pursuing get-rich-quick schemes or dishonest practices. Christians must never be caught up in these traps (see Proverbs 21:5-6; Proverbs 28:20; Proverbs 16:11).

 

Another potential danger of examining our financial situation is discouragement that can lead to despair. Many Christians find themselves in financial holes that can be so daunting as to seem overwhelming. Some lose hope, perhaps even contemplating or resorting to suicide. This indicates one of the problems with using the term “net worth.” When the world uses the term, they often mean it quite literally. Many people assume that a person’s worth, or value, is measured by his or her net worth or annual income. If their financial situation becomes “hopeless,” they may decide they are worthless as individuals.

 

I would recommend that we get in the habit of using the term “financial net worth” for the number the accountants calculate. Using this calculation is a useful tool for diligently managing our finances. However, we must never forget that this number does not reflect our “true net worth.” My true net worth is much greater than all the material assets in the world (Matthew 16:26). No matter what my financial circumstances may be, I was purchased by the precious blood of my Savior (I Peter 1:18-19). That is the measure of my true net worth.

 

 

Stan Bullington, Ph.D., has taught economic analysis for engineers for over twenty years. He is the author of Solomon on Wealth.