A net worth statement is defined as the difference between your total assets (what you own), and your total liabilities (what you owe). Understanding your net worth is important for measuring your financial development from one year to the next. With the right planning, your net worth should improve over time.
Calculating your net worth is fairly simple. You’ll need to total up all of your assets, including items like your home, car(s), and liquid assets such as savings, checking and retirement accounts, cash value of life insurance policies, loans you have made to others, as well as valuable personal items. Then total up your liabilities such as your mortgage, car or student loans, and credit card debt. Subtract your liabilities from your assets to calculate your net worth.
With the assistance of a financial advisor, calculating your net worth can be a very constructive way to determine and keep tabs on your financial health’s progress or lack of progress.
If you would like to speak with a Senior Wealth Advisor at R.W. Rogé & Company, Inc., please contact us for a complimentary consultation at 631.218.0077 or via e-mail at email@example.com.
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