4. It can also give you a figurative tap on the back: knowing that you’re aligned with your goals makes you feel good.
5. Some lending institutions also ask for your net worth when you’re applying for a loan so having one is already handy and convenient. (You can just ask a professional to check what you’ve produced.)
What’s the formula to get your net worth?
Dude, I’m not asking you to do Integral Calculus or any Organic Chemistry formula right now. You only need to ADD and SUBTRACT numbers! How cool is that?
Net worth = Your Assets – Your Liabilities
If you don’t like computing manually, here’s a simple spreadsheet to get your net worth in only a matter of minutes.
What are your assets? (What you own)
- Total cash (savings account, checking account, time deposit accounts & cash on hand)
- Total investments (your stocks, your bonds, your mutual funds and your UITFs)
- Other important assets (your whole, term or VUL insurance & privately-owned businesses)
- Personal Property (vehicles, jewelry, furniture you own and electronic equipment & gadgets)
- Receivables (money that people owe you)
- Real estate
- Total loans (housing, auto or personal loans)
- Consumer debt (credit card debt)
- Other payables (life insurance payables & money you owe from people)
Fired up to manage your money yet? Contact your trusted financial advisor (or me! 🙂 to help you get started.