By: TK Irons

“If you can’t measure it, you can’t improve it.” – Peter Drucker

Well, more than enough time has now passed where most of the half-hearted, new-year’s-resolution-fueled weight loss goals have been broken.

“I just need to get to the gym four days a week.” “I need to stop eating out…”

Most people unwittingly bite off more than they can chew. For example, eating out less sounds simple on the surface, but really means more meal planning, grocery shopping, cooking, dishes, etc.

Ultimately, only action truly matters. Simple goals avoid discouragement, and one to implement would be to wake up in the morning, stand on the scale first thing, and record what you see consistently until you reach your goal. Your brain gets to work on positive changes first thing in the morning. It allows for testing many strategies and tactics along the way.

This is one of those magically simple tasks that is easy to understand, but difficult to implement. In fact, things like this often get cast off as too simple to actually be important or effective. Don’t let yourself fall into this trap. Often the best solution is the most simple one (think Occam’s Razor or index investing).

The only way to move toward any goal is to track concrete progress. It requires some discipline, but most importantly – the emotional strength to face the (sometimes unpleasant) truth of your movement forward or backward. This simple practice builds your discipline muscle, establishes a baseline for progress, and highlights results.

Consider your personal finances the exact same way by creating your personal balance sheet, a simple list of assets and liabilities: Assets (cash, retirement accounts, property, etc.) minus Liabilities (loans, credit card debt, student loan debt, etc.) equals Net Worth

This formula is the scale you use to find your financial weight.

Include only absolute value (ignore the cash flow). So, your monthly car payment isn’t a factor – only the outstanding loan balance. Similarly, paychecks are irrelevant, only cash already in your account matters.

If body weight is most important when losing weight, then net worth is definitely most important when building wealth.

Try a quick calculation and write it down, but make it a place you can return the following month to log a new entry.

It doesn’t have to be perfect*. It will get more precise over time. Also, it’s common for younger people to have negative net worth. Wherever you find yourself is fine.

Almost anyone seeking progress will feel unsatisfied with the net worth they see. One number doesn’t tell you much of anything, so don’t sweat it, it’s only valuable as a measure over time.

Only briefly note what the number is, and then allow yourself to dream about the new heights you will reach as your future self.

How would it feel to be a gal who has no debt? How about a guy who manages a large portfolio? Get excited about the number you would like to see next month or next year!**

*If you want the easy way – front load the work by logging your accounts onto an online platform like Personal Capital or Mint. These sites will perpetually update your net worth with zero effort on your part.

**Or for a different approach to motivation – most of us work around 2000 hours per year. Multiply 2000 by the number of years you have been working full-time (you can add roughly 10% to that number for your drive time). What do you have to show for it? Work toward ensuring your net worth reflects a number that makes you feel good about all that life energy you spent working, sweating, commuting, or stressing.

Author Bio: TK is a past 3rd Decade graduate who lives and breathes the philosophy taught in class. He avidly researches personal finance and investing topics, and occasionally contributes thoughts here on the blog. He graduated cum laude from the University of Arizona with his BSBA. As a longtime saver and investor, his net worth today is higher than the total number of dollars earned in his lifetime. He keeps his annual living expenses super low, owns his house free and clear, and has zero personal debt. TK currently resides in Tucson, AZ with his wife, and works full-time as a firefighter. Feel free to send him a message at