Associate Financial Planner Lance Knaack gives the definition of net worth as the total wealth of an individual, company, or household, considering all financial assets and liabilities.
Lance shares why knowing your net worth can be a useful tool for evaluating how many resources you have to take care of any life event or emergency. It can also help lenders determine whether borrowers have the ability to pay off their loans.
This Finance Moment explains the difference between net worth and net wealth. Your net wealth includes the value from your net worth and adds in assets that you control, but don’t own (i.e. charitable remainder trusts, donor advised funds, or 529 plans).
Net worth is one of the numbers Syverson Strege financial planners look at to gauge a client’s financial health to create an overall financial plan.
Finance Moment…Syverson Strege’s mini-podcasts to provide rapid-fire information on financial topics of the day.