When it comes to tracking the health of your personal finance, the net worth statement is the best way to measure your financial situation. This easy calculation can help you determine if you are on track with your financial goals, or if you are in trouble and need to tackle your debt. Download the Finance Throttle Net Worth Tracker or consider spending the time to create your own.
WHAT IS A GOOD NET WORTH?
Every person is different. Your net worth should not be compared to others. A 35 year old with a net worth of $200,000 could be better than a 35 year old with a higher net worth of $300,000 depending on their cost of living and what they are invested in. The Net Worth Statement is a tool for you to measure your own financial health. Here are a few examples of the median net worth by country.
- United States $45,000
- Canada $97,000
- U.K. $108,000
- France $100,000
- Italy $104,000
- Germany $43,000
- Japan $120,000
- Switzerland $244,000
Examples
When calculating the net worth of your car (asset), you would first see what your car is worth. In this example, your car is worth $12,300.
When calculating what you owe on your car loan (liability), you would simply check your remaining balance on your loan. For example $6,000.
If you were to sell your car today, the net worth of your car would be $12,300 – $6,000 = $6,300. The value of your home subtracted by the mortgage owed would get you the net worth on your home. You ALWAYS want your ASSETS to be higher than your LIABILITIES.
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