Net Worth for Retirees: How to Tell If You’re Poor, Middle Class, or Rich Outside the US

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Have you ever wondered how your net worth stacks up compared to the rest of the world? Those interested in retiring outside the United States may wonder if their net worth is a positive number, zero or negative number.

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Luckily, there are a few tools you can use to calculate your wealth and compare it to the global population. Let’s review which ones can help you determine if you’re poor, middle class or rich outside the United States.

How To Calculate Your Net Worth

Before you can start making any comparisons, you should have an understanding of your current net worth. Net worth is defined by the Federal Deposit Insurance Corporation (FDIC) as your assets minus your liabilities.

Couldn’t you just refer to your income to determine your financial health? The answer is no for a few reasons. The FDIC said a person’s income does not properly indicate any assets or liabilities they may have. Income is always at risk of disruption, such as via job loss. Many retirees also do not work and measuring income would not be the best indicator of their financial health.

When you calculate your net worth, you’ll receive a positive number, a negative number or zero. Here’s what each result means.

• Positive number. Retirees will want to have this number because it means their assets can cover any liabilities with enough left over to provide a safety net in case of emergencies.
• Zero. If you calculate your net worth and the number is zero, this means you don’t have a safety net. The assets you have equal your liabilities. 
• Negative number. This would be the worst number for retirees to see. It indicates you have far more liabilities than assets and no safety net in emergency financial situations.

A tool is available from the FDIC to help calculate your net worth. You only need to follow three simple steps to get the results.

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1. List Your Assets and Their Value Amounts

You can type in the values of various assets including cash, checking account funds, savings account funds, matched savings accounts, savings bonds, stocks or mutual funds, CDs, 401(k) plan, IRA and any other investments and life insurance policies.

Additionally, retirees may include the values of their cars and trucks, any recreational vehicles they may own and their home’s current market value. Other values to add in may include those for jewelry, antiques, electronics, furniture and appliances.

According to the FDIC, entering the values in the tool will help automatically calculate your total assets. This should be visible at the end.

2. List Your Liabilities and Amounts You Owe

Enter the amount of money you owe across a wide range of liabilities mentioned in the calculator. Some of the liabilities mentioned include credit card balances and store credit balances, any outstanding bills for services, the principal balance of your mortgage, the principal balance of your vehicle loans (if you have any), any student loan balances, and the balances on any home equity loans or lines of credit.

Like calculating your assets, the tool will automatically calculate your total liabilities.

3. Review Your Net Worth

Now you can see your total assets and liabilities and the amount which is determined as your net worth.

How To Find Out How Rich You Are Compared To the Rest of the World

It can be a little trickier to determine where your wealth stands when compared to the global population. If you are still working and curious as to how your finances stack up, you can use the tool “How Rich Am I?” provided by Giving What We Can to make a basic calculation.

Individuals based out of the United States can type in their yearly household income after taxes and the number of adults and/or children in their household to see where their wealth ranks globally.

Let’s use the example of typing in $50,000 after taxes as your household income. According to How Rich Am I, you would be considered among the richest 1.8% of the global population. Your income is more than 15.3 times the global median.

What if your household income is $500,000 after taxes? According to calculations made using this tool, you would be considered in the richest 1% of the global population. Your income is more than 152.8 times the global median.

However, remember that these calculations only take one’s income, not their net worth, into consideration.

For retirees, it may be best to discuss the results of your net worth with a financial professional and ask any additional questions. This is especially important if you are considering retiring overseas and want to make sure your net worth positions you for a comfortable retirement in a specific country. A financial professional will be able to review your net worth and provide additional guidance on what to do next.

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This article originally appeared on GOBankingRates.com: Net Worth for Retirees: How to Tell If You’re Poor, Middle Class, or Rich Outside the US