What are YOU worth? While worth can be measured in any number of ways, the worth I’m referring to is your Net Worth.
Definition of Net Worth
Net worth is a key indicator of how you are doing financially. In a nutshell, net worth is calculated by taking the total value of what you own (assets) and subtracting what you owe (liabilities).
Calculating your Net Worth
Calculating that number takes a little bit of effort but it’s not difficult to do. I’ve created a tool to help you figure out your net worth. Click the link to the Older Wiser Money Miser Net Worth Calculator, and enter your email address. You’ll be taken to a page where you can download either an Excel or Google Sheet file. I’ve also recorded a short video to walk you through the process of using the sheet and calculating your net worth.
Increasing your Net Worth
Increasing your net worth can be accomplished by either increasing your assets, decreasing your liabilities, or both! There are several posts in the Older Wiser Money Miser Debt Free Challenge that can walk you through the process of setting your spending priorities and clearing your debt.
Negative Net Worth? Don’t Panic!
A negative net worth is not necessarily catastrophic. It’s most likely an indicator of a good bit of debt and not a lot of savings. If you’ve recently graduated college using student loans or recently purchased a home, chances are your net worth will be negative. Once you start paying down those loan balances your net worth will increase.
Update Regularly to Track Progress
One of the great things about having a tool you can customize is that you can calculate your net worth regularly to track your progress. If you’re really ambitious you can create a chart in the Net Worth Calculator to get a visual of how you’re doing. I get a little OCD about this from time to time but I really like seeing a concrete picture of how I’m progressing.
If that number is not where you want it to be, I can help you get there. Older Wiser Money Miser Financial Coaching is up and running. Drop me a line at email@example.com and let me know how I can help you increase your net worth and reach your financial goals!
Be well and God Bless – until we meet again…
Source: The Simple Dollar