123ArticleOnline Logo
Welcome to 123ArticleOnline.com!
ALL >> Business >> View Article

Financial Basics: Calculate Your Net Worth

Profile Picture
By Author: Leon A. Elwell
Total Articles: 64
Comment this article
Facebook ShareTwitter ShareGoogle+ ShareTwitter Share

Whatever your financial goals in life – whether they include buying a new house, taking a trip to Europe, funding your children’s college educations, having enough money fora comfortable retirement, or all of the above -you are more likely to reach your goals if you do some planning. The fact that you are reading this indicates your desire to plan and to take control of your financial life.

After you’ve set your financial goals, the next step is to determine your current net worth. Only when you know where you are today can you calculate how far you have to go to reach your financial goals in the future.

On a sheet of paper, list everything you own (your “assets”) and everything you owe (your “liabilities”). Subtract the total liabilities from the total assets; the result is your current “net worth.”

In doing this exercise, it’s important to review the actual documents for the specific assets and liabilities and accurately record account numbers, identification, and dollar amounts. It’s easy to forget details about assets and liabilities and to list misleading information.

After ...
... you’ve arrived at your current net worth, ask the following questions:

1. Has your net worth increased since you last did this listing? If it hasn’t, you need to determine the reason and perhaps make some changes in your spending, saving, or other financial habits.

2. Does your net worth statement reflect a preference for personal assets such as an expensive home, cars, furs, and jewelry? Your balance sheet should show a concern for acquiring investment assets, not just personal assets that are far less likely to increase in value or produce income that will help you meet other financial goals.

3. Is your debt out of proportion? If your sheet shows excessive debt, especially for personal consumption, that’s a signal to review your spending. Keeping debt under control is essential in good financial management.

4. Have you given enough thought to money needed for retirement? If your sheet shows total neglect for accumulating funds for retirement, you’ll want to make some changes as soon as possible.

5. Are your assets diversified? Diversification is a good hedge against inflation and changes in the economy. Having all your eggs in one basket is seldom a good idea. Also, don’t keep excess cash in no-interest or low-interest accounts unless you have an immediate need for the cash.

6. Where do you want to be three years, five years, and ten years from now, in terms of your net worth? You might determine this by doing projected net worth calculations for three years, five years, and ten years from now.

Conduct a net worth calculation like this every year in order to chart the progress you’re making in increasing your net worth.

Need financial assistance? Count on our team to guide you. Schedule a free, no obligation introductory call here: https://www.bas-pc.com/appointment-center

Get More info : Visit Here : https://bas-pc.com/contact-us/

More About the Author

Business Accounting Systems, P.C., is a South Jersey Public Accounting Firm located in West Deptford, New Jersey that has been providing excellence in servicing the accounting, payroll, and tax needs of independently owned small businesses throughout the Tri-State area. For More Info : Visit Here : https://www.bas-pc.com/

Total Views: 199Word Count: 475See All articles From Author

Add Comment

Business Articles

1. Single Screw Plastic Extruder Demystified For Manufacturers
Author: ADVAN

2. Leed And Its Impact On Today's World
Author: Agile Advisors

3. Enhancing Safety And Sustainability: Tempgenius Blood Bank And Environmental Monitors
Author: Chris Miller

4. Verg Restoration
Author: PAVEL VERGULYANETS

5. Key Players And Competitive Landscape In The Insect Pest Control Sector
Author: MarketsandMarkets

6. Earthing Rod And Its Types
Author: EARTHING ROD AND ITS TYPES

7. Unveiling Excellence: The Journey Of A Pcb Manufacturer And The Innovations In Rigid-flex Pcbs
Author: Shenzhen Shuoqiang Electronics Co.,Ltd.

8. Exploring Multilayer Pcbs, Aluminum Base Pcbs, And Choosing The Right Pcb Supplier
Author: Shenzhen Shuoqiang Electronics Co.,Ltd.

9. Best Wati Alternatives In 2024 To Improve Customer Engagement
Author: Vilas

10. Revolutionizing Retail Spaces With Architectural Cad Design And Drafting Services
Author: Pavantheaecassociates

11. Professionell Diskning I Stockholm: Ta Hjälp Av Erfarna Diskare
Author: hemstandind i sigtuna

12. Canva Acquires Design Platform Affinity To Bring Professional Design Tools To Every Organization
Author: otis

13. Best Static And Dynamic Website In Mumbai
Author: Techstreat Web Solutions

14. Mastering The Road: The Essential Training For Becoming A School Bus Driver With Northstar Bus Lines
Author: Northstarbuslines

15. Exploring The Potential Of Hydrogen Technologies: A Clean Energy Revolution
Author: yogitamnm

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: