How To Compute Your Net Worth

How to compute your net worth is not hard. It can be done easily with just pen a paper. To start, list your largest assets in one column and how much you still own in another column and the estimate of current value in another column. Your assets are your house, vehicle, boat, and any other property or items of value. If you do not know your homes current value you may want to find that out. Blue book can be used for vehicles. The next set of items to write down is money in checking and savings accounts, CD’s, retirement accounts, and cash on hand. The final consideration is a list of personal items that are of value. Such as coin collections, artwork, and jewelry, list only items worth $500 dollars or more.

When all assets have be listed and values found, add them all together. This number will signify your total assets. Now it is time to look at your liabilities. First you will start with all outstanding monies still owed, such as the mortgage on your house, car loans, and so on. Then you will list personal liabilities including credit cards, student loans, and any other debts you may have. Add all the liabilities and find the grand total. The final step is to subtract the liabilities total from the assets total and there you have your net worth.

This is your starting point for knowing what your net worth is now. You can then use this information to plan on how to improve this total. One of the quickest ways for most to improve their net worth is to eliminate credit card debt. The goal is to improve your net worth every year.