How is Net Worth determined?

Net worth can be determined by adding up all the assets, or items that have some value, and subtracting all the liabilities, the debt, or what is owed by a person or company.

Assets

The value of everything you own that has financial value, such as money in bank accounts, real estate, stocks, bonds or personal property

Liabilities

The total amount of financial obligations or debts you owe, such as credit card balances, mortgages, auto loans, and student loans.

The formula for calculating net worth is:

Net Worth = Assets - Liabilities

 

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• Net Worth