Net Worth vs. Income: The Number That Tells You More

You make a good salary—but how much are you actually keeping? Let’s talk net worth.

For most physicians, the first big financial milestone after training is a major jump in income. After years of scraping by as a resident, suddenly you’re looking at six-figure paychecks. But even with that jump, many new attendings find themselves asking the same question: Why doesn’t it feel like I’m getting ahead?

That’s where tracking your net worth comes in.

Income Tells You What’s Coming In. Net Worth Tells You What’s Left.

It’s easy to assume that a high income equals financial success. And while income is important—it creates the fuel for your financial goals—it’s only part of the story. If you’re spending every dollar that comes in (or more), your income isn’t translating to financial progress.

Net worth is a better measure of whether you’re actually building wealth. It takes everything you own (assets) and subtracts everything you owe (liabilities). The result is a snapshot of your overall financial health.

Net Worth = Assets – Liabilities

Tracking your net worth helps answer key questions like:

• Am I making progress on my student loans?

• Is my savings rate keeping pace with my lifestyle?

• How much cushion do I have if something unexpected happens?

Why This Matters for Physicians

Physicians often graduate with significant debt—sometimes multiple six figures. That makes it easy to feel like you’re behind before you’ve even started. But tracking your net worth can flip that mindset.

Early on, your net worth might be negative. That’s okay. What matters more is the direction it’s heading. Seeing your net worth improve month by month—because you’re paying down debt, building savings, or contributing to retirement accounts—can be incredibly motivating.

It also helps you stay focused on the long game. When you’re making a high salary, it’s tempting to spend freely or assume you’re doing “fine” financially. But tracking net worth keeps you honest. It shows you if your spending is outpacing your saving or if big-ticket purchases (like a house or car) are adding more debt than value.

How to Start Tracking Your Net Worth

Getting started tracking your net worth doesn’t have to be complicated. Here’s a simple framework:

1. List your assets – these are things you own

• Cash and checking/savings accounts

• Investments (401(k), Roth IRA, brokerage accounts)

• Property (home equity, vehicles, etc.)

• Any other items of value

2. List your liabilities – these are things you owe

• • Student loans

  • Credit card balances

  • Car loans or mortgages

  • Any other outstanding debts

3. Do the math
Subtract liabilities from assets to get your total net worth.

You can do this with a spreadsheet, a financial planning tool, or even pencil and paper. The most important part? Update it regularly—monthly or quarterly is a good cadence. You’ll start to see patterns over time and can adjust your decisions accordingly.

What Net Worth Can Reveal

Once you start tracking, you’ll likely notice things you weren’t aware of:

• A high cash balance with no investing = missed growth

• Large income but flat net worth = overspending or under-saving

• Aggressive loan repayment = good progress, but is it crowding out other goals?

None of these are necessarily wrong, but they should be intentional. Tracking your net worth helps you understand the trade-offs and decide if they align with your bigger goals.

Just Remember...

Income is what you earn. Net worth is what you keep. If you want a clearer picture of your financial life—and a way to measure progress that goes beyond your paycheck—start tracking your net worth. It’s one of the simplest, most powerful financial habits you can build. And the sooner you start, the more control you’ll have over where your money takes you.

Additional Resources: 

Finance for Physicians podcast:  Why Budgeting Matters - Align Your Finances with Heather Lovallo, CFP®

Wrenne Financial Planning is a registered investment adviser. The content of this blog post is intended for informational purposes only and is not intended to be investment advice. The views expressed in blog post are subject to change based on market and other conditions. Some information has been obtained/provided from third party sources and is believed to be reliable, but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability or completeness of, nor liability for, decisions based on such information, and it should not be relied on as such.