The Rules of Money, 5 of 7

If you do not yet have the number, calculate your personal balance sheet. Or, what are you worth? Add up your assets: what do you own, what money do you have…..add it all up. Take away your liabilities: what do you owe such as a mortgage, a car loan……add it all up. Now subtract the latter (the liabilities) from the former (the assets). Clearly it would be nice if the answer were large positive but depending where you are in your life and career it may be large negative. That’s why it’s useful to know the number and re-calculate it regularly. It helps you with your financial decisions and long-term planning. Go do some arithmetic.