Take a household with 15,000 euro in cash and savings, a 40,000 euro pension, a 350,000 euro home, and 20,000 euro of investments. That adds up to 425,000 euro of assets. Against it sits a 220,000 euro mortgage, 8,000 euro of loans, and 1,500 euro on credit cards, totalling 229,500 euro of liabilities. Net worth is assets minus liabilities, so 425,000 less 229,500, which is 195,500 euro. The debt-to-asset ratio is 229,500 divided by 425,000, about 54%, meaning a little over half the value of what they own is still financed by debt. As the mortgage is paid down, the ratio falls and net worth rises even if asset values hold steady.
Item
Value
Total assets
425,000 euro
Total liabilities
229,500 euro
Debt-to-asset ratio
about 54%
Net worth
195,500 euro
How it is calculated
Net worth is a simple subtraction, but a useful one. The tool sums everything you own at its current value: cash and savings, the value of your pension, property at market value, and investments. It then sums everything you owe: the outstanding mortgage balance, personal loans, and credit card debt. Net worth is the assets total minus the liabilities total, and it can be negative if debts exceed assets, which is common early in a mortgage or with student debt. The debt-to-asset ratio divides total liabilities by total assets and shows how leveraged you are; a lower figure means more of what you own is genuinely yours. Tracking the number every few months is more revealing than any single snapshot, because it captures both debt repayment and the drift in asset values over time.
Frequently asked questions
What counts towards net worth?
Net worth is everything you own (assets) minus everything you owe (liabilities). Assets include cash and savings, pension value, property at market value, and investments. Liabilities include the outstanding mortgage, personal loans, and credit card balances. A positive figure means assets exceed debts; the debt-to-asset ratio shows how leveraged you are.
Should I include my pension in net worth?
Yes. In Ireland, occupational pensions and personal retirement savings accounts (PRSAs) are real assets with a present-day value. Revenue allows tax-relieved contributions within age-related limits, so pensions are a tax-efficient way to build net worth. The value to include is the current fund value, not a projected retirement figure.
How does property affect the debt-to-asset ratio?
Property is usually the largest single asset for Irish households, and the mortgage against it is the largest liability. As you pay down the principal and as property values rise, the ratio falls. Revenue does not tax unrealised gains on a primary residence under the principal private residence relief, so the full market value is the correct figure to use for net worth purposes.
What is a healthy net worth target in Ireland?
There is no fixed rule, but a common benchmark is net worth of roughly one times annual income by age 30, three times by age 40, and six times by age 50. In an Irish context, a large pension fund matters because drawdown in retirement benefits from lower marginal tax rates and the 25% tax-free lump sum available under Revenue rules at retirement, making pension assets worth more after tax than equivalent savings held outside a pension wrapper.