What Is My Net Worth·

Posted By: Dr. Frugal in Frugality on 06/04/2007 at 20:48:09

You might be asking "What is my net worth·". It's a great place to get started. Your net worth is simply the difference between all the things of value that you own and all the debts you owe, or in financial terms, your assets minus your liabilities.

Evaluating your net worth right now will give you a glimpse into your current financial condition. This information will help you effectively set financial goals. Having this information on-hand will also come in handy when applying for a mortgage, credit card, or car loan.

Some people avoid making lists of their debts because they're afraid they won't like what they find or believe they already have a good feel for their complete financial situation. Purposefully avoiding this knowledge or trusting an "intuition" is only going to hurt you. Not being aware of your financial condition can really hurt you in a time of crisis: losing your job, getting injured at work...and it's impossible to plan for the future if you're not sure where you are right now.

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