@Anonymous wrote:How do you calculate networth?
Net Worth is your total assets minus your total debts, in a nutshell.
Put another way, if you were to liquidate everything you own except the clothes on your back, how much money would you be worth (OR) how much money would you owe?
The easiest way to do it is to add up all your cash, bank accounts, investments, market value of larger assets like houses, cars, or even other holdings of value like boats, airplanes, significant collectibles or antiques to get your asset total. (You can add the value a home or car, for example, even if it's not yet paid off. The amount you owe will be reflected in the other calculation for debt.)
Then, add up everything you owe including credit card debt, student loans, medical debts, and the outstanding balance on home mortages, car loans, etc. You may need to use online tools to estimate current market value of real estate, cars, or other assets, particularly if you've held them a long time and they may have depreciated or appreciated significantly from the price you originally paid.
Assets minus debts equals net worth.
Most people don't literally calculate it down to selling all their various possessions, as that is too complex and more inconsequential, but you could take it that far if you wanted. But it's good to have a rough idea what you're worth and to try to improve it over time.
@Anonymous wrote:credit card optimization is done mostly for fun. It will not make you rich.
@Gollum wrote:
Nobody builds wealth via credit card cash rewards.
I concur that cash rewards on credit cards will never turn anyone into a billionaire.
On the other hand, the attitude that it is just for fun and can't turn into significant money is a matter of perspective. It ignores the value of saving even smaller amounts of money over time and the enormous value of compounding interest or investment appreciation. Small amounts can turn into big money, especially given enough time. Saying a little cash savings is insignificant seems to me a defeatist attitude that dismisses the value of small steps in reaching financial goals. More millionaires in this country started out appreciating the value of a penny than there are millionaires born into wealthy families.
Some people prefer to just use their cash rewards to ease their day-to-day budget constraints. Nothing wrong with that, but as has been said many times here, a few dollars here and there probably won't be life-changing. And some people just need that little boost to their effective income. The only problem with that is it taints our perspective of how valuable that cash back could be over time because it so quickly disappears as soon as it appears. It literally slips through our fingers.
On the other hand, some choose to save their rewards up for major purchases or travel rewards, via either cash or points. That is also an easy way to relieve our day-to-day budget and add value to our lives, but it probably isnt' life-changing.
For a person who is saving and especially if they have a longer time-line, cashback rewards could really add up over time. If I were to chose to bank all my various cashback rewards instead of using them to pay down my bills, I could easily be banking several hundred if not even more than a thousand dollars a year (especially if counting SUBs). In other words, you could be recognizing and setting aside those small cash rewards like "found money" that you get in addition to what you would be spending anyway.
And then what happens? Here's one example. (You can do the same calculations of your own if you look for online "compound interest calculators.")
Let's say I were able to set aside $1,000 per year in cash back and SUBs from various cards. That is not an unrealistic goal, depending on spend level and credit cards. I think I'm a pretty average consumer and I get over $150 back annually from my CITI Costco card alone, and that is only one of my many rewards programs. And many cards right now are offering SUBs worth at least several hundred dollars for spending I would be doing anyway. So year 1, I deposit $1000 into an investment earning a conservative rate of return of only 5%. (The average rate of return of the S&P 500 stocks since 1957 is 8%.) Each year, I deposit another $1K and compound that interest monthly. After 20 years, that $1K annual investment would be worth $37,108. (If I averaged the full 8%, I would have $54,339.)
For most average Americans, that's not insignicant money. Would you take an extra $54K? I would! 
Considering how abysmal retirement savings are for the average American, that money could help contribute to a somewhat more comfortable retirement, for example. But it requires the discipline to practice delayed gratification to allow financial markets to work their magic also.
And I applaud people like who want to use their cash back rewards in a longer-term investment strategy. That is why I suggested the Fidelity and Charles Schwab cards, because they are specifically designed to make it easier for people who want to invest their cashback savings.
Thanks, Aim_high, this is the type of thing I was thinking of. Up to this point, I've done like most with this little bit of cashback and just applied it to my current balances. This still has the same effect as I then have to pull out less money from my income, which improves, my overall financial health.
With your example of 100 bucks per month, most people could reduce their mortgage 7-10 years by just applying that amount to their payment as an extra payment each month. This is what I'm leaning towards doing with this little extra as that has the potential to save me the most over time in terms of interest payments I won't need to fork over.
The 2 dollars here and there can add up to a lot if you give it enough time and apply it to the correct part of your finances.
