Health is wealth. So is your financial health
Your bank account balance and your total assets are not all there is to your networth and self-worth. Trying to find out your true net worth and how to grow it is not an exercise only for the rich.
To get the answer to “What is my net worth?” subtract your total liabilities from your total assets. Take a close look at these assets and investments that can boost your net worth and give you a truer picture of where you stand.
Owning a property
Home ownership ranks among the most common ways people gain a substantial increase in net worth.
Though house price increases have taken a breather, they still don’t come cheap. But it’s a dream that must be kept alive to boost your net worth.
Retirement might be decades in the future, but saving now can enhance your net worth. Saving for retirement is something you can start doing as early as possible. Consistent saving is the key.
By treating your savings contributions as a budget item, you’ll consistently put money away, which will allow it to grow and increase your net worth.
You might not have thought of it this way, but your education credentials are among your greatest assets. Choosing to invest in your own education to qualify for a better job or gain a promotion can help you reap significant financial gain over time.
And your education doesn’t have to end when you receive your bachelor’s degree. It doesn’t come free, but investing in education, pays.
If you’re still not convinced, consider this: With a savings account paying 2% interest, you would have to save $300,000 before you would see $6,000 in additional income — an amount that can come much more quickly from a promotion or annual raise that you earn as a result of additional education.
Income from an extra job
Choosing to take on a side hustle can earn you some extra cash. And as long as you save or invest the cash, you’ll increase your net worth.
Consider doing jobs that pay enough to make them worth your time, such as finding and reselling items for a profit, house sitting, driving for Uber or Lyft, becoming a virtual assistant or hospitality work.
Kick out debts
Credit card debts and Interest-bearing loans are a liability and can hurt your ability to boost your net worth. The best ways to grow your assets and increase net worth include targeting debt with the highest interest rates first, then paying other debts off as you go.
Shed this debt fast and watch your net worth rise fast.
Having good health is a critical asset to building your net worth. It allows you to work more hours and be more productive without spending a bundle on medical appointments, treatments or surgeries. Invest in good health by eating well, exercising and visiting your doctor for regular checkups.
Live below your means, and be happy in it
Living on less than you earn can be a great way to build your net worth and prepare for the future. No matter how good your intentions are when trying to live below your means, you’ll need conviction to make the hard changes necessary to spend less.
You might think living below your means is impossible, but by making a concerted effort little by little, you can manage your expenses and leave more money for debt repayment or saving and growing your networth.
Maintain your home
Because your home is likely one of your largest assets, it makes sense to invest in maintaining it. Things like replacing your roof, maintaining your gutters and regularly servicing your HVAC system can get you a better return when it comes time to sell.
On the other hand, neglecting your home can give potential buyers opportunities to use lack of maintenance as a way to negotiate a cheaper price, leaving you with less money in the end.
Permanent Life Insurance
Most people assume they can’t access their life insurance unless something happens to them, but that isn’t always true.
If you have a permanent life insurance policy — such as a whole life, universal life or variable life policy — the premiums you pay will grow tax-deferred. Once the policy has reached a certain cash value, you can access the funds tax-free. The accumulated cash, less any fees, counts as an asset that can increase your net worth.
You might not consider a new refrigerator or laptop a way to boost your net worth but consider the big picture.
Just like when buying a vehicle, it pays to buy the best quality, longest-lasting products you can afford while also considering the rate at which these items depreciate.
Constantly paying repair bills and replacing appliances can be a costly endeavor, but buying quality items boosts your net worth because it leaves more money in the bank. To determine which brands and models are the best investment, read reviews, compare products and find the best deals.