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...is the process which provides you a framework for achieving your life goals in a systematic and planned way by avoiding shocks and surprises.
It’s a statement wherein you can jot down your assets and liabilities.
While planning for retirement, you need to clarify a few poi...
The credit card has been regarded as the most expensive form of debt. As soon as your salary gets cr...
SIMILAR ARTICLES & IDEAS:
Investing is about laying out cash or assets now, in the hope of more cash or assets returning to you tomorrow, or next year, or next decade.
Most of the time, this is best achieved th...
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Your net worth gives an overview of your financial situation at this point. It is the difference between what you own and what you owe.
Your net worth is positive if your assets exceed...
Assets are anything of value that you own that can be converted into cash. Examples include:
Your liabilities represent your debts, such as loans, mortgages, credit card debt, medical bills and student loans.
Determine your target net worth - where you want to be in the near-term and long-term future.
The following formula is helpful:
Target Net Worth=[Your Age−25]∗[1/5∗Gross Annual Income]
A 50-year-old with a gross annual income of $75,000 might aim for a net worth of $375,000 ([50 - 25 = 25] x [$75,000 ÷ 5 = $15,000])
Your net worth can be much more or much less than the amount indicated by the guideline.
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