| When it comes to financial literacy and thinking | | | | least 10 percent each year. |
| Wealth Creation you can not help but think Net | | | | Unfortunately, for most persons this is usually a |
| worth. As Net worth is your best indicator of | | | | negative number - meaning that you owe more |
| how well you are doing with wealth creation. And | | | | than you own. If this is your case do not lose |
| by focusing on your Net worth you will ensure | | | | heart just commit to changing this number into a |
| that you maintain the appropriate ratios between | | | | positive one as soon as possible. And the only |
| your debt and assets. | | | | way that can happen is if you begin to curtail for |
| I am sure you may have heard this financial | | | | spending and access to credit. |
| expression before but may not really understand | | | | It may also surprise you to hear that becoming |
| what it is. Your Net worth is simply your total | | | | wealthy is not about investing a lot of money, it is |
| assets minus your total liabilities - what you own | | | | really about investing regularly for a long period of |
| minus what you owe. And is reflective of your | | | | time. As wealth takes time and the length of time |
| wealth at any given time. | | | | is more important than the amount of money. |
| So the real question is will you use your earning | | | | And most financially independent persons have |
| to create wealth or simple give it away? | | | | been investing for 30 years and benefiting from |
| Will you chose debt or wealth? | | | | their most important asset "Time" which allows |
| As you cannot consume your money and create | | | | you to take advantage of one of the most |
| wealth at the same time. Nor can you service | | | | powerful financial force - compound interest! |
| debt and build wealth at the same time. By simply | | | | Unfortunately, the reason you may not be building |
| financing your current lifestyle with debt you are | | | | wealth is NOT because you do not know about |
| giving up the opportunity for a secure financial | | | | wealth-building technique. It is really because you |
| future. | | | | do not have any money left to invest each |
| Here is a simple test to see how well you are | | | | month! |
| doing with your building wealth. | | | | Which is why it is important for you to develop a |
| Multiply your age by your current income and | | | | plan that allows you to take control of your |
| then divide by 10. | | | | money and each and every pay. You need to |
| Your result is the estimated Net worth you should | | | | begin now to revaluate how you are spending |
| have for your age and current annual income. | | | | your money and understanding and eliminating all |
| If you are age 35 with an annual income of | | | | debt so that you can begin focusing your money |
| $40,000 then your Net worth would be 35 x | | | | on creating wealth instead. Taking Control of Your |
| $40,000.00 = $1,400,000.00 /10 = $140,000.00. | | | | Money Workbook is a useful resource for getting |
| And you should be growing your net worth by at | | | | started. |