Personally, do you know what your net worth is? This week’s edition is an activity which should help us know that. In a nutshell, your net worth is your assets minus your debts/liabilities.
It is important to know your net worth because it helps you correctly ascertain your current financial situation. Also, it serves as a yardstick to measure your financial progress towards your goals. To fully monitor your progress, it is advisable you calculate your net worth periodically every year.
To calculate your net worth properly you must be able to properly categorize your assets and liabilities. Your assets put money in your pocket while your liabilities take money out of your pocket.
With this, I leave you to calculate your net worth, taking into account all your income sources and expenses streams.
Have a great week ahead!
To your financial independence and freedom
Originally posted on July 19th 2018 on www.thefinancialliterate.wordpress.com (A previous version of The Financial Literate)
Activity 101: Calculating your Net Worth