
Remember in the Wizard of Oz when Dorothy finds out that the Great and Powerful Oz is just a regular guy hiding behind an elaborate display? That’s what it’s like to peer behind the curtain of many “rich” people’s extravagant lives. One peek at their net worth would reveal that a fair number of them are frauds.
Someone’s net worth is a great indicator of whether they’re actually rich or just fake rich. In today’s world, where so much of our lives are broadcast on social media, we’ve been plagued with an epidemic of people who are fake rich. They look like they have it all, but in actuality, their net worth is negative and they buy everything on credit.
Celebrities aren’t immune to the fake rich phenomenon either. While on her Monster tour, Lady Gaga found out that she was $3 million in debt, Michael Jackson reportedly died $400 million in debt, and Donald Trump has declared bankruptcy a whopping 6 times.
Two celebs are keeping it 100 with their money and are definitely real rich, though. Beyonce and Jay Z. Their estimated combined net worth is $1.4 BILLION! To help you get real rich like the Carters, I’m breaking down how to calculate your net worth and how to grow it using lessons from Jay Z and Beyonce.
How to Calculate Your Net Worth
Your net worth is the total value of everything you own after paying off all of your debts. More formally, it’s the value of all of your assets minus all of your outstanding liabilities.
If your assets exceed your liabilities, your net worth is positive. If your liabilities exceed your assets, your net worth is negative. A negative net worth means that even if you sold all of your assets, you still couldn’t pay off all of your debt. That’s a problem.
The fake rich have negative net worths and use mounting debt to buy flashy assets like cool cars and trendy clothes. The problem is that the more debt you pile up, the less financially secure you are. If your whole life is financed using debt, it doesn’t matter how rich you look, you’re one of the fake rich.
To make sure you’re getting real rich, not just fake rich, you should calculate your net worth regularly. If your net worth is increasing, you’re building wealth and on the right track.
Below is the formula to calculate your net worth.
Net Worth = Assets – Liabilities
What are assets?
Assets are property that you own that has value. Basically, if you can list it for sale and someone will buy it, it’s an asset. Simple as that.
Some examples of assets
- Businesses
- Homes/Real Estate/Land
- Cars
- Investment accounts
- Cash/Savings
To calculate your assets, list out all of the big stuff you own along with its current value. Smaller items like clothing and furniture are also assets, but these aren’t usually worth very much for most people. If you have designer clothes, antiques, or collectibles that are worth a lot of money, list those out too. Try to be as accurate as possible with the fair market value of your items.
Once you have all of your assets listed out, add up all of their market values to get the total value of your assets.
What are liabilities?
Liabilities are things that you owe. Your debts. They’re financial obligations that you have to pay to another person or entity.
These include
- Mortgages
- Car loans
- Student loans
- Credit card debt
- Personal loans
- Accounts payable balances
To calculate your liabilities, list out all of your outstanding loans and their current balances. Then, add all of them up to get the total value of your liabilities.
Formula for Net Worth
Once you’ve calculated your total assets and total liabilities, plug those numbers into the formula below to find out your net worth.
Net Worth = Assets – Liabilities
How to Grow Your Net Worth
Now that you know your current net worth, here are some tips on how to increase it.
Buy Appreciating Assets
Buy assets that make you money, not assets that make you look like you have money.
To get rich you need to use the money you have to make more money. This goes for cash purchases and purchases financed with debt. Contrary to popular belief, not all debt is bad, and it can be a great wealth-building tool. Regardless of whether you’re using debt or cash to finance your purchases, you need to buy appreciating assets if you want to build wealth.

Appreciating assets are assets that make money. They do this because their value increases over time. Two of the most popular appreciating assets are real estate and stocks. Historically, the returns on both of these have been excellent over the long term. For beginner investors, these are great assets to use to start your wealth-building journey.
One of Beyonce’s most profitable money moves was when she asked Uber to pay her $6 mill in stock for her performance at an Uber event instead of accepting payment in cash. Four years later, her $6 mill was worth $300 mill! Investing your money into wealth building assets like stocks and real estate may mean that you forego having extra cash on hand now, but it also means that you’ll have a lot more wealth later.
Other appreciating assets include businesses, art, commodities, and collectibles. Jay Z talks about building wealth by investing in art in his song The Story of OJ. He says, “I bought some artwork for 1 million / 2 years later, that shit worth 2 million / few years later, that shit worth 8 million.”
Jay’s lyrics clearly display the ability to compound your wealth by buying appreciating assets. In his example, he grew his net worth by $7 mill just by buying that one piece of art alone. And that’s just a tiny portion of what he invests his money in. By investing in multiple appreciating assets, he can speed up his wealth-building dramatically. The same goes for you.
Capitalize on Your Talents
Jay Z started Rocawear to make money for himself instead of for other brands. He noticed that every time he wore a brand or rapped about one in a song, that brand’s sales skyrocketed. He realized that if he created his own clothing brand, wore it, and rapped about it, he could have all of that money flow to him instead of another brand. So, Rocawear was born.
While you may not have Jay Z level influence, that doesn’t mean you can’t monetize your talents. The first step in doing that is obviously finding your talent. A great way to do this is to think about what advice friends, family, and coworkers come to you for. Is it outfit advice, health and fitness, recipes, or money? Whatever it is, if other people ask you for advice on it, they want to be influenced by you. Chances are others will too.
Once you know your point of influence, then you can monetize it. There are a lot of different ways you can do this. You can start a blog or YouTube channel, create an online course, build a following on social media, start an Etsy shop, open a store or restaurant, the list is endless.
This method will not work if you don’t want to dedicate substantial time, effort, and possibly money to your new hustle, though. Creating businesses and building up a following can take years. If you aren’t willing to put a lot of blood, sweat, and tears into a new endeavor, don’t do it. You’ll end up wasting money. Instead, invest in low maintenance appreciating assets, as we discussed earlier.
The formula for increasing your net worth is simple. Buy more appreciating assets, and use less bad debt. The hard part is avoiding the temptation to become fake rich. Being fake rich is fun while it lasts, but it comes at the cost of constantly being on the verge of financial ruin. One day, the facade will crack, and the truth will be exposed. To avoid going from being fake rich to being real poor, you should invest in appreciating assets and capitalize on your talents. Doing that will grow your wealth and make you real rich like Jay and Bey.
[…] out all of your savings, debts, and investments, and how much you have of each. Then calculate your net worth using this formula. Don’t feel bad if your net worth is negative! Many people, including me, had negative net worths […]