Net Worth

Front

What is net worth?

Back

Net worth is the difference between total assets and total liabilities. It represents the value of an individual's or entity's financial position.

Front

How do you calculate net worth?

Back

Net worth = Total Assets - Total Liabilities.

Front

What are assets?

Back

Assets are valuable resources owned by an individual or entity, such as cash, real estate, and personal property.

Front

What are liabilities?

Back

Liabilities are financial obligations or debts that an individual or entity owes to others, such as loans and mortgages.

Front

Can net worth be negative?

Back

Yes, net worth can be negative if liabilities exceed assets.

Front

What is an example of an asset?

Back

Jewelry, real estate, stocks, and cash are examples of assets.

Front

What is an example of a liability?

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A mortgage, credit card debt, and student loans are examples of liabilities.

Front

If assets are $100,000 and liabilities are $40,000, what is the net worth?

Back

Net worth = $100,000 - $40,000 = $60,000.

Front

What does it mean if someone has a high net worth?

Back

A high net worth indicates that an individual has more assets than liabilities, suggesting financial stability.

Front

What does it mean if someone has a low net worth?

Back

A low net worth may indicate that an individual has more liabilities than assets, suggesting potential financial difficulties.