How to know where your money actually stands

By the StratEQ team · a plain-English guide

Here's the verdict up front: you can know where your money stands with four numbers and about an hour. What's left each month. What you owe, and when it clears. How many months you could last if the income stopped. And your net worth — everything owned minus everything owed. This article shows you how to work out all four by hand, and then how to read them together as one plain answer.

The feeling of not knowing

If someone asked you, right now, "so how are you doing, money-wise?" — could you answer in one sentence?

If the answer doesn't come easily, that isn't carelessness. It's that nothing you use is built to produce an answer. The salary lands. The bills go out. There's a current account, a savings account, a credit card, maybe a loan or two. Each one has its own app, its own balance, its own graph. Plenty of data. No conclusion.

So the honest answer becomes "fine, I think?" — with a small unease underneath it. Not panic. Fog. You suspect you're okay, you can't quite prove it, and every unexpected expense reopens the question.

The fix isn't more tracking. It's fewer, better numbers. Four of them.

The four numbers that answer it

Each number answers one question you actually care about:

1. What's left each month. Am I living inside my income, and by how much?
2. What you owe — and when it clears. What's the total, and is there an end date?
3. Months of runway. If the income stopped tomorrow, how long before it hurts?
4. Net worth. Adding everything up, am I moving forwards or backwards?

Notice that none of these is your bank balance. A bank balance is a snapshot of one account on one day — it can look comfortable the day after payday and worrying the day before. These four numbers describe how your money actually works, not how one Tuesday looks.

How to work out each one by hand

You'll need last month's statements, a list of your debts, and something to write on. It works in whatever currency you earn in.

1. What's left each month

Take a recent, reasonably normal month.

• Write down what actually landed after tax — salary, side income, anything regular.
• Write down what went out on commitments: housing, utilities, transport, food, insurance, debt repayments, subscriptions.
• Catch the annual costs that ambush you — renewals, licences, school fees. Add them up, divide by twelve, and include that as a monthly line.
• Subtract the outgoings from the income.

The result is your monthly margin. Positive means the month funds itself with room over. Around zero means you're balanced but exposed — a surprise expense has nowhere to go except credit. Negative means the gap is being filled from somewhere, usually savings or a card, and it's better to see that written down than to keep sensing it.

One month can mislead, so if the number surprises you, run two more months and take the middle one.

2. What you owe — and when it clears

List every debt: each card, loan, overdraft, store account, and anything owed to family. For each one, note the balance, the interest rate, and what you pay monthly.

Two numbers come out of this list.

The total — every balance added together. It can be an uncomfortable figure to look at. It's still better in front of you than behind you.

The horizon — when it clears. This is the harder sum, because interest keeps working against you while you pay. A rough version by hand: for each debt, divide the balance by the monthly payment to get months remaining, then treat the answer as optimistic — interest pushes the real date later, and the higher the rate, the further it pushes. A loan calculator does this precisely; by hand, "roughly this many months, plus interest" is enough to replace "no idea" with an end date.

The point of this number isn't shame. Debt with a visible finish line feels completely different from debt that just… continues. (There's a calmer way to choose which debt to clear first — that's its own guide.)

3. Months of runway

Runway is how long you could keep the essentials going if the income stopped.

• Add up the savings you could actually reach within days — an emergency fund, ordinary savings, money sitting in current accounts. Leave out anything locked away or invested for the long term.
• Work out your essential monthly spend: what you'd keep paying in a hard month — housing, food, utilities, transport, insurance, minimum debt payments. It's usually a fair bit less than a normal month's spending.
• Divide the first by the second.

The answer is in months, and it's one of the most honest numbers you own. You'll hear rules of thumb about how many months is "enough"; the more useful step is simply knowing yours. It turns a vague background worry into a measured distance.

4. Net worth

Net worth is the whole picture in one line: everything you own, minus everything you owe.

• Own: cash and savings, investments, retirement balances, your home at a realistic value, a car at what it would actually fetch.
• Owe: the full debt list from earlier, plus the mortgage.
• Subtract.

The number can be negative, especially early on or with a mortgage and a student loan in the mix. That's a starting point, not a judgement. Net worth is the slow number of the four — what matters isn't where it sits today but which way it moves when you check again next quarter. (More on reading it well in Net worth, explained plainly.)

Four facts, one verdict

Each number on its own is a fact. Read together, they become a verdict — because they explain each other.

A healthy monthly margin with zero runway reads differently from the same margin with six months banked: the first is earning well but exposed, the second has slack in the system. A negative net worth with debts that clear in two years is a very different position from a positive net worth that leaks a little every month. The reassurance — or the honest warning — lives in the combination, not in any single figure.

Written out, a verdict is just those four facts in one breath. Something like:

"Your month funds itself with about 1,500 spare. Your debts total 48,000 and clear in roughly three years at the current pace. Your runway is two months — thin, but growing. Your net worth is slightly negative and moving the right way."

One paragraph, and the fog is gone. Not because anything changed — because now you can see it. (Those numbers are an example, not a target; yours will look like yours.)

That combined reading, in plain English, is exactly what the usual tools don't produce. A bank app can't do it, because it only sees its own account. A spreadsheet could, if you build it and then keep feeding it. In practice, the four numbers live in four places and the verdict never gets written.

That's the gap StratEQ was built for. You enter your numbers — income, spending, debts, savings, what you own — and it does this exact arithmetic: your monthly margin, your debts in one ranked list with their horizon, your runway, your net worth. Then it puts the verdict into plain sentences — where you stand, with the evidence underneath. It computes on your own numbers; it doesn't tell you what to do with your money, and it doesn't sell you anyone's products. It's free to start, there's no card to enter, and in the free preview your numbers stay on your device.