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Building Wealth: Net Worth

How to Grow Your Net Worth (Wealth)

 

Net Worth = Asset - Liabilities

 

Set financial goals. 

  • Short Term (1 year out):

    • Set a Savings goal for the next year .

    • Commit to learn about money topics.

  • Longer Term (3-5 years out): 

    • Graduate debt free?

    • Open an investing account?

    • Set a Net Worth target?

 

To increase net worth you have two basic options:

  • grow your assets

    • bank account, investments, real estate

    • you want to create multiple sources of income

  • reduce your liabilities

    • credit card balance, car loan, mortgage

 

Update your Net Worth Statement at least once per year to measure your progress (year-end is ideal).

  • Are you on track with your goals?

  • If you are short of your target why?

  • What course corrections do you need to make?

 Net Worth Worksheet

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  • calculate your current net worth

  • estimate one year out

  • build action plan to achieve target

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Asset: what you own

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  • good assets

    • bank accounts

    • investments

    • real estate

  • bad asset

    • vehicle

  • own assets that put money in your pocket (produce income)

  • avoid assets that take money out of your pocket (vehicles)

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Liability: what you owe

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  • good liability

    • student loan

  • bad liability

    • credit card debt

    • car loan

Income Producing Assets
 
You can use your savings to grow your asset column in lots of different ways:
  • Investing in financial assets
  • Investing in real estate
  • Owning a small business
 
The focus of this web site is growing wealth by investing in financial assets. 

Secure your financial future by getting a little better every day

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Feedback? Suggestions of how to make the site better?  Email us at wgssflc@gmail.com

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