Net worth

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What is Net Worth?

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Net Worth is the difference between total assets and total liabilities. It represents the financial position of an individual or entity.

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What is an Asset?

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An asset is anything of value or a resource owned by an individual or entity, such as cash, real estate, or investments.

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What is a Liability?

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A liability is a financial obligation or debt that an individual or entity owes to another party.

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How do you calculate Net Worth?

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Net Worth = Total Assets - Total Liabilities.

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If Assets = $20,000 and Liabilities = $50,000, what is the Net Worth?

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Net Worth = $20,000 - $50,000 = -$30,000.

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What is an example of a liability?

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Examples of liabilities include credit card debt, student loans, and mortgages.

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What is an example of an asset?

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Examples of assets include savings accounts, stocks, and property.

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What does it mean if someone has a negative Net Worth?

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A negative Net Worth means that liabilities exceed assets, indicating financial distress.

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What is the relationship between assets and liabilities?

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Assets are what you own, while liabilities are what you owe. Net Worth is the balance between the two.

Front

What is the formula for calculating Net Worth?

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Net Worth = Assets - Liabilities.