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Net Worth Statement - Part V
By JLP | December 12, 2005
As promised, here is an example of a net worth statement. I modeled this after one that I found in an out-of-print book called The Fast Forward MBA in Financial Planning by Ed McCarthy.
|
ASSETS |
|
|
Financial Assets |
|
|
Cash |
200 |
|
Checking |
3,000 |
|
Money Market Accounts |
7,000 |
|
Savings |
6,000 |
|
CDs |
6,000 |
|
Payments Receivable |
10,000 |
|
Total Financial Assets |
$32,200 |
|
Personal Assets |
|
|
Clothing |
5,000 |
|
Furnishings |
15,000 |
|
Autos |
30,000 |
|
Home |
200,000 |
|
Other |
1,100 |
|
Total Personal Assets |
$251,100 |
|
Investments |
|
|
Stocks |
25,000 |
|
Bonds |
0 |
|
Mutual Funds |
35,000 |
|
Retirement Plans |
250,000 |
|
Life Insurance Cash Values |
0 |
|
Business Interests |
25,000 |
|
Real Estate |
0 |
|
Total Investments |
$335,000 |
|
TOTAL ASSETS |
$618,300 |
|
LIABILITIES |
|
|
Short-Term |
|
|
Utilities |
500 |
|
Credit Cards |
3,000 |
|
Other |
1,500 |
|
Total Short-Term Liabilities |
$5,000 |
|
Long-Term |
|
|
Auto Loans |
15,000 |
|
Student Loans |
30,000 |
|
Mortgage |
175,000 |
|
Other |
0 |
|
Total Long-Term Liabilities |
$220,000 |
|
TOTAL LIABILITIES |
$225,000 |
|
NET WORTH* |
$393,300 |
*($618,300 - $225,000 = $393,300)
As you can see, it is a pretty straight-forward exercise. Notice that this couple’s net worth is a positive $393,300. Had their liabilities been greater than their total assets of $618,300, they would have had a negative net worth.
Tomorrow’s post will be about the cash flow statement. YIPPY!
Topics: Basics, Financial Planning, Net Worth Statement |