Understanding Net Worth

net weight = gross weight - package weight

Net Worth = Assets - Liabilities

Net Worth = value of owned items - how much you owe

Assets

• bank accounts
• mutual fund accounts
• 401(k) or 403(b)
• retirement accounts
• home (minus what you owe)

Increase this part of the equation by: (a) Saving more; (b) Spending less; (c) Earning more

Liabilities

• student loans
• car loans
• home loans (mortgage) - see last item in Assets
• personal loans
• credit card debt

Decrease this part of the equation by: (a) Paying down loan(s); (b) Increasing payment sizes or make extra payments; (c) Refinance loan(s); (d) Don't take on new loans

Goals for Net Worth

1. Move from negative to positive net worth
2. Increase your net worth by increasing your assets and simultaneously reducing your liabilities
3. Live and Share

Last updated: 2023-03-27