It's hard to feel rich right now when your paycheque just doesn't seem to stretch as far as it used to. But, according to a new article in MoneySense magazine, you may be doing better than you think.

That's because your paycheque is only half the picture, contends the article. The bigger picture is net worth.

When we look at net worth, Canadians are doing better now than they were at the beginning of the decade, says Rob Gerlsbeck, features editor at the magazine where the article "The All-Canadian Wealth Test" was published.  

"The good news is we are seven per cent richer that we were in 2000, which was the height of the dot com boom," he told CTV's Canada AM on Monday. "So we've made progress. It's been slow progress but we've made progress."

Gerlsbeck concedes the wealth of most Canadians has been hit by the recession, particularly with the huge stock market investment losses most have experienced in the last two years.

"We have fallen," he said. "Between 2007 and 2009, our wealth fell 10 per cent, which is bad in one respect. But to another degree, this was a very bad recession; the first recession Canada has had in almost 20 years, and the worst since probably the Great Depression. And yet Canadians' wealth has fallen [only] 10 per cent in that two-year period."

Wealth is calculated by looking at net worth, which is the value of all we own -- RRSPS, investments, vehicles and home equity -- subtracted by all debts, including mortgage, loans, and credit card balances.

That net worth has dropped 10 per cent in the last two years. But in terms adjusted for inflation, we're still seven per cent richer than in 2000.

Gerlsbeck says many people get confused about how rich they are because they equate a high salary with wealth. But they are not the same thing.

Income, of course, has an impact on wealth. But someone who earns a high income yet saves little of it can easily not have as much wealth as someone who earns a modest income but is diligent about saving.

Many Canadians also confuse their wealth with the market value of their house. The more important measure is the size of their mortgage, because market value is not the same as money in the bank.

"There's a bit of a concern here because a lot of Canadians now perceive their wealth around the value of their home," says Gerlsbeck. "People see that their house is worth $500,000 and last year, it was worth $400,000 last year, so that must mean we're rich. But we're not really rich because the only way you'll get that money is to sell the house. And then you'd still need a new place to live."

The article contends that there are warning signs that Canadian wealth will drop, because of our growing addiction to debt. In 1990, the average Canadian owed 91 per cent of their disposable income. Now they owe 142 per cent, so we are spending more than we're making.

"We should all be saving preferably 10 per cent of our income and putting that into savings," says Gerlsbeck.

"We're not doing that. Canadians think that we're frugal and better savers than Americans, but the fact is we're not. Over the last couple of years, we've become just as debt-ridden as Americans."

- Canadians who want to see if their net worth is growing can visit MoneySense.ca, where they can use the Net Wroth Calculator. They can then use the the Wealth Comparison Calculator to compare the results to people like themselves.