The first step in planning your finances is to know where you financially stand today i.e. ascertaining your net-worth. Your net-worth is the difference between what you own and what you owe i.e. YOUR ASSETS - YOUR LIABILITIES. Calculate your net-worth periodically, say quarterly and keep track of changes. An increasing net-worth means you are doing well financially.
To calculate your current net worth, enter the information in the table below. Keep in mind the following points while filling the table.
1. Use current market value.
2. Estimate if you canít be accurate.
3. Be conservative.
4. Avoid insignificant detail.
5. Be honest. Nobody else needs to see these figures.