Net Worth/Cash Flow

Your net worth is the value of all your assets minus the total of all your liabilities (debt).

If you owe more than you own, you have a negative net worth. If you own more than you owe, you have a positive net worth. A positive number is good and a big positive number is even better.

Your Cash Flow is the value of all your income minus all of your expenses. If you end up with a positive number, you are ahead. If it is a negative number, then you are living beyond your means and need to either increase your income or reduce your expenses.

These two calculations, Net Worth and Cash Flow, are an essential part of getting your finances under control.

If you need help calculating these reports, you can talk to your accountant or your financial planner.

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