Net worth is the most widely used measure of personal wealth. It is calculated by subtracting all outstanding debts and obligations (liabilities) from the total value of everything a person owns (assets). Assets include cash, real estate, stocks, business equity, vehicles, and other valuables. Liabilities include mortgages, loans, credit card debt, and other financial obligations.
For billionaires, the largest component of net worth is typically stock ownership in public or private companies. When a company's stock price rises, the billionaire's net worth increases proportionally to their ownership stake. This is why billionaire net worth figures fluctuate daily in line with stock market movements.
Forbes and Bloomberg estimate billionaire net worths using public records, SEC filings, stock ownership data, and reported asset values. Private holdings are harder to assess and are often estimated conservatively.